Mike Bailey of FBB Capital Partners said that although the economy is performing well, investors should consider positioning their portfolios as early as early 2024 to prepare for volatility due to lingering macroeconomic uncertainty. He said he might want to consider it. “We definitely want to diversify because we don't know if there's going to be a recession,” the company's head of research told CNBC. “That's why we want to keep our defense strong.” [stocks] Mr. Bailey sees positive positions in place for a number of companies that are likely to be winners in 2024, particularly those that are able to gain market share over their competitors, deliver growth, beat profit expectations and move forward. We recommend high-quality companies that are increasing their guidance. AMZN 1Y Mountain's Amazon stock price over the past year Amazon remains Mr. Bailey's top choice, with his peers offering compelling valuations compared to some of the company's Magnificent stocks. There are 7 companies in the market with good growth prospects thanks to advertising, artificial intelligence and e-commerce. “The benefits are huge and are just starting to come in. To us, this looks very convincing. [a] Amazon has won Wall Street approval in recent weeks, with many sell-side investment banks calling it a top pick for 2024. The company soared 81% in 2023, and analysts believe Amazon will continue to rise 81% in 2023. Based on Friday's closing price and the consensus price target, the stock has averaged an 18% upside. Microsoft is a close second to Mr. Bailey, but Mr. Bailey cites similar AI advantages and the company offers new growth prospects this year, even with long-term upside from AI. You should. The rise of a weight-loss drug known as GLP-1 shocked the fast food and beverage industries last year. Wall Street is already beginning to question what the impact will mean for an industry dependent on further demand, but many companies have been dismissive of McDonald's, a fast-food giant that continues to outperform investors' expectations. The concerns haven't deterred Bailey from making his bets, and the stock is trading at a discount given the organic and volume growth it has achieved. MCD 1Y Mountain McDonald's Stock Last Year “To me, that feels a little overhyped. For example, McDonald's is trading well below average in terms of valuation,” he said. “If demand falls, it will already be under some pressure.” [as a result of] Baileys also found favorite stocks in the insurance industry, particularly in UnitedHealth Group and Progressive. UnitedHealth stock lagged growth-oriented technology companies in 2023, ending the year down less than 1%. However, the stock is trading at a cheap valuation and should continue to have value. Mr. Bailey sees Progressive as a “contrarian” approach to finance, taking market share from competitors such as Geico and State Farm. “We do a better job than our peers of understanding where the insurance cycle is going and setting prices based on that. This is a very compelling idea to us,” he said.
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