Wells Fargo's equity research team has some ideas for investors as the new quarter kicks off. The firm's list this quarter includes eight names with near-term catalysts that can drive their share prices higher. Wells Fargo also identified two stocks that may retreat.
Investors are quoestioning whether the first half's strong gains will continue in the back end of 2024. The broad S & P 500 rallied more than 14% in the first six months, while the artificial intelligence craze drove the tech-heavy Nasdaq Composite higher by more than 18%. Against this backdrop, Wells Fargo ran a screen looking for stocks that its analysts rate overweight, and that have positive catalysts in the third quarter quarter.
Its report was published Monday July 1. Here's which stocks made the cut: Capital One has a potential catalyst if the Discover merger goes through, according to Wells Fargo. On top of that, lower-income credit card holders may prove more resilient than currently believed.
Concerns around its credit card holders have led Capital One to underperform this year, rising around 6% against the S & P 500 surging more than 14%. Wells Fargo is out of step on Wall Street, as the average analyst has a hold rating on Capital One. The average price target implies more than 10% upside, while Wells Fargo's target would equate to an 18% rally.
For Ontario-based Algonquin Power & Utilities , Wells Fargo said the third quarter could provide clarity on the $5 billion market cap utility's strategic revi.