Want to own the very top S&P 500 stock of 2024? It's not going to be Nvidia again — and it won't even be in the top 5, analysts say.
Analysts expect 10 mostly surprising S&P 500 stocks to be the best over the coming year, including First Solar, Moderna and Wynn Resorts, says an Investor's Business Daily analysis of data from FactSet and MarketSmith. All these stocks are seen jumping more than 37% over the next 12 months. If that happens, nine would outperform Nvidia's forecast 37% gain in that time.
If analysts are right, it would mark an end to Nvidia's runaway No. 1 outperformance in the S&P 500. Shares of the AI giant shot up more than 225% this year — making it the top S&P 500 stock so far by far. Meta Platforms is No. 2 with a 176% rise.
But next year, it looks like analysts see a broadening out of winners.
S&P 500 Investors Gearing Up For 2024
Investors are constantly looking forward. So it's no surprise analysts are already making predictions about next year when it's only December.
As a group, analysts appear bullish for 2024. "Industry analysts in aggregate predict the S&P 500 will have a closing price of 5,068.41 in 12 months," says FactSet's John Butters. And if that's right, it would mark a gain of roughly 10% next year. That's a solid rally. It's roughly in-line with the S&P 500's average long-term annual returns.
And analysts' calls on the market rung true for 2023. Coming into 2023, analysts thought the S&P 500 would end the year at 4,499.37, Butters says. That prediction was only 2% below the actual gain. Not bad.
So where do analysts see most of the action of 2024?
Analysts Pick 2024's Stock Winners
Energy stocks are analysts' favorites as a sector next year. And that's reflected in some of their top picks for the year.
"The energy sector is expected to see the largest price increase at 26.1%, as this sector has the largest upside difference between the bottom-up target price and the closing price," Butters said.
And true to form, energy firm Schlumberger is one of analysts' top picks for next year. The company's stock is predicted to jump more than 43% during the next 12 months to 70 a share. Such a gain would be a welcome change for investors, who watched the shares drop 9.4% in 2023. The company's earnings are predicted to rise more than 22% in 2024. That's on top of an expected 36% rise in earnings this year.
But the S&P 500 stock analysts think will be best in the next 12 months is First Solar. They're calling for an impressive 58.1% rise — enough to beat all other S&P 500 stocks. An unlike some other favorite stocks that are down huge this year, First Solar is only off 2.9%. Analysts clearly like the fundamental story at First Solar. The company is seen making $7.92 a share in profit this year, reversing a year-earlier loss. And in 2024, profit per share is expected to rise more than 65%.
Analysts' calls aren't right. But they nailed their market call for 2023 so it just might be worth paying attention again.
Analysts Top S&P 500 Picks For Next 12 Months
| Company | Symbol | Upside to target | Sector |
|---|---|---|---|
| First Solar | 58.1% | Information Technology | |
| Moderna | 45.0 | Health Care | |
| Bio-Rad Laboratories | 44.7 | Health Care | |
| Schlumberger | 43.7 | Energy | |
| Wynn Resorts | 42.7 | Consumer Discretionary | |
| Halliburton | 42.3 | Energy | |
| Caesars Entertainment | 40.8 | Consumer Discretionary | |
| Las Vegas Sands | 40.3 | Consumer Discretionary | |
| APA | 39.2 | Energy | |
| Nvidia | 37.3 | Information Technology |
