Unless you are a hedge fund portfolio manager who has spent 2022 shorting tech stocks and cryptocurrencies, like most investors you are more than ready to flip the calendar, and with just over 5 weeks left in the year, that’s right around the corner. However, those looking for a new year to usher in a fresh bull market may be a little disappointed if the strategists at Goldman Sachs are correct.
The team at Goldman Sachs (like many on Wall Street) doesn’t feel that we have hit the capitulation trough that is so needed to put a bear market back into hibernation. In fact, they think that the S&P 500 ends 2023 at the 4000 mark on the venerable index, less than 1% down from the current trading level, citing rising interest rates and valuations that are still too high. They also think the rally from the October lows is not sustainable.
Given that rather grim outlook, we decided to screen the Goldman Sachs Conviction List of top stock ideas for large cap blue chips that can wrestle the bear in 2023, and still provide positive total return. Seven stocks that pay dividends look like outstanding ideas for growth and income investors, and while all are rated Buy, it’s important to remember that no single analyst report should be used as the sole basis for any buying or selling decision.
Bank of America
Interest rate increases are welcomed by banks, and this is one of the biggest in the country. Bank of America Corporation (NYSE: BAC) is a ubiquitous presence in the United States, providing various banking and financial products and services for individual consumers, small and middle market businesses, institutional investors, corporations, and governments in the United States and internationally. Operating 5,100 banking centers, 16,300 ATMs, call centers, and online and mobile banking platforms.
Bank of America has expanded into a number of new U.S. markets, with scale across the country positioning them ideally to benefit from accelerating loan growth over the next two years. Moreover, unlike smaller peers, scale allows the bank to substantially increase investment over the next few years without notably jeopardizing returns, driving further market share gains.
Shareholders are paid a 2.37% dividend. Goldman Sachs has a $41 target price. The Wall Street consensus price target is posted at $41.31. The shares were last seen Monday at $37.31. It should be noted that Warren Buffett owns a stunning 1.1 billion shares of the bank.
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