Satori Fund founder and portfolio manager Dan Niles is out with his top stock picks for 2024 and two Magnificent 7 names are at the top of the list.
What To Know: The Satori Fund’s top picks for this year are a mixture of offensive and defensive names, as the firm believes the S&P 500 could either rally significantly in 2024 or suffer a sizable drawdown, depending on the Federal Reserve.
“We believe the S&P could gain another 20% (10% from earnings growth and another 10% from multiple expansion) if the Fed does in fact engineer the first soft landing since 1995,” Niles said Wednesday in a social media post.
TOP 5 PICKS 2024
As a reminder, Our initial Top 5 picks coming into 2023 had a skew of defense and offense. Those were:
1) $META – Our favorite megacap w/ low valuation & growth
2) $MUFG – Japan abandoning Yield Curve Control eventually
3) $URA – resurgence in nuclear energy… https://t.co/Um7AEIZTbN
— Dan Niles (@DanielTNiles) January 3, 2024
“Having said that, if we do get a shallow recession in 2024 given the long and variable lags in monetary policy, we could see the S&P down 30% (10% earnings decline and 20% multiple compression).”
Check This Out: Soft Landing? Don’t Bet On It Just Yet: Fed’s Barkin Indicates Further Rate Hikes Possible
The Top 5: The top stock on Niles’ list for 2024 is Amazon.com Inc (NASDAQ: AMZN).
Amazon tends to gain market share during recession and has a lot of profit margin expansion potential, Niles said this week in a CNBC interview.
The second name on the list is Meta Platforms Inc (NASDAQ: META), which is the only stock that was also on Niles’ top stocks list for 2023.
Niles told CNBC that Meta is growing revenue 15% year-over-year and is trading around 25 times earnings, which is much more reasonable than other names in the Magnificent 7, he said.
Apple Inc (NASDAQ: AAPL), for example, had negative 1% revenue growth in 2023 and is trading around 30 times earnings, Niles said.
The third name on Niles’ top stocks for 2024 list is Texas Instruments Inc (NASDAQ: TXN).
“Despite two of the Magnificent 7 being top picks on one of the barbell, we are increasingly looking for beaten up names with compelling valuations outside of the Magnificent 7 to drive returns,” Niles said in the X post.
Texas Instruments was only up 3% in…
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