If the idea is to buy low, then going shopping for stocks when markets are at record highs might not seem like the greatest idea. But there are always select names set to outperform — and that's especially true when market leadership is comparatively narrow.
Although select members of the Magnificent 7 stocks have done much of the bull market's heavy lifting, that hardly means these names are doomed to underperform from here. Indeed, as we'll see below, three of Wall Street's top five stocks to buy now hail from the Magnificent 7. Companies from the real estate, oil & gas and, uh, french fry sectors are also ably represented.
Here's how we found the top S&P 500 stocks to buy now. It's well known that industry analysts are reluctant to slap Sell ratings on the names they cover. There are a bunch of reasons for this, some more defensible than others. What's less commonly understood is that Strong Buy recommendations, while not as rare as Sell calls, are in short supply too.
If you run a screen of the S&P 500 using data from S&P Global Market Intelligence, you'll see that analysts assign a consensus recommendation of Sell to a total of three stocks. At the other end of the rating spectrum stands the Street's highest recommendation of Strong Buy. A total of 19 stocks make the cut there, as you can see in the chart below.
But first a note on our methodology: S&P Global Market Intelligence surveys analysts' stock recommendations and scores them on a five-point scale, where 1.0 equals Strong Buy and 5.0 means Strong Sell. Any score of 2.5 or lower means that analysts, on average, rate the stock a Buy. The closer the score gets to 1.0, the stronger the Buy call. In other words, lower scores are better than higher scores.
Have a look at the chart below to see the 19 stocks in the S&P 500 that score an elite Strong Buy recommendation from industry analysts. Investors who fear it's too late to buy Amazon.com (AMZN), Microsoft (MSFT) or Nvidia (NVDA) will be happy to see they easily made the list.
The “Magnificent Seven” might sound like the title of an old Western film or what a large family might name its group chat, but in finance the moniker is being used to describe a group of high-performing tech stocks: Microsoft, Apple, Nvidia, Alphabet, Amazon, Meta and Tesla.
Alongside Microsoft Corporation (NASDAQ:MSFT), NVIDIA Corporation (NASDAQ:NVDA), and Apple Inc. (NASDAQ:AAPL), Adobe Inc. (NASDAQ:ADBE) is one of the best money making stocks to invest in. In its Q3 2023 investor letter, Polen Capital, an asset management firm, highlighted a few stocks and Adobe Inc.
The S&P 500 could approach or exceed the 10,000 level by the early to mid-2030s. Many investors take it as a given that—since returns on the S&P 500 have been strong for 10-plus years—stocks are expensive and over-owned.
One important thing for all investors to learn is that timing the market is impossible. And quite frankly, it's unimportant if you're investing in a high-quality S&P 500 index fund for the long term. Even if you buy at a market peak, your long-term returns should likely be excellent.
SPY, VOO and IVV are among the most popular S&P 500 ETFs. These three S&P 500 ETFs are quite similar, but may sometimes diverge in terms of costs or daily returns.
Altria Group, Inc. (NYSE:MO), AT&T Inc. (NYSE:T), and Verizon Communications Inc. (NYSE:VZ) are some of the highest-paying dividend stocks in the S&P 500 among others that are discussed below.
The simplest way to invest in the index is through S&P 500 index funds or ETFs that replicate the index. You can purchase these in a taxable brokerage account, or if you're investing for retirement, in a 401(k) or IRA, which come with added tax benefits.
Introduction: My name is Neely Ledner, I am a bright, determined, beautiful, adventurous, adventurous, spotless, calm person who loves writing and wants to share my knowledge and understanding with you.
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