Wells Fargo Says Buy Stocks, Not the Stock Market Right Now. Here’s Their Bargain List
Recent market volatility has created some bargains for momentum stocks, according to Wells Fargo. The major averages managed to recover from Monday’s sharp global sell-off on concerns about the U.S. economy and the unwinding of the yen-yield spread trade. Bears stepped in on Thursday, sending the S&P 500 to its best session since November 2022. Still, Wells Fargo analyst Christopher Harvey remains cautious on the broader market, saying investors are “buying stocks, not the stock market.” Individual names that have become cheaper during the market sell-off — including surging Meta Platforms — could be primed for a buy. “We’re unlikely to pound the table and recommend a buy now given this week’s events, traditional pre-Fed price action, and lack of catalysts that keep us cautious,” Harvey wrote on Friday. “However, we see opportunities for selection. For example, we believe the 9% decline in the overrated Transaction Services sector is an attractive entry point.” Here’s a closer look at the stocks Wells Fargo is eyeing amid the recent market volatility. Nvidia has an impressive 110% upside by 2024. The stock has fallen about 20% over the past month as investors worry about the AI boom and when it will pay off. Harvey isn’t the only one who thinks Nvidia’s decline could present a buying opportunity for investors. Jefferies analyst Blayne Curtis said concerns about AI chip delays don’t change the firm’s thesis on Nvidia. “We understand that issues like this are common, the only difference here is the level of scrutiny at every step of the supply chain,” Curtis wrote. Nvidia NVDA YTD Stock. Nvidia will report its Q2 results at the end of August. Harvey also listed Meta as a potential bargain buy. Shares of the Facebook parent company are up about 45% in 2024 but down 3% over the past month. The social media company beat Wall Street estimates for top- and bottom-line revenue in Q2, driven largely by a surge in advertising revenue. Meta also forecast Q3 revenue of $38.5 billion to $41 billion, compared with the $39.1 billion expected by analysts polled by LSEG. Meta Platforms shares by META YTD. Eli Lilly is up 53% in 2024 but down about 8% over the past month. Lilly, the maker of the weight-loss and diabetes drugs Zepbound and Mounjaro, beat analyst estimates in Q2 and raised its full-year revenue guidance. Other stocks on the list include streaming giant Netflix and ride-sharing service Uber.
