Top 10 Preferred Stocks According to Wall Street Analysts Amidst Anticipated 19% S&P 500 Growth

1. Wall Street Analysts' Bullish Outlook for 2023

Outside of a handful of highflying technology stocks, U.S. stocks have been practically flat in 2023, but on Wall Street, some analysts remain as bullish as ever.

2. Projections for S&P 500's Growth in the Coming Year

An analysis of their projections for individual stocks’ performance over the next 12 months has the S&P 500 index rising 19% from its level on Sept. 21, when the index closed at 4,330, according to an analysis from FactSet’s John Butters.

3. Sector-Level Expectations for Stock Market Performance

At the sector level, investors expect information technology to see the largest advance, with a projected gain of 22.8%. Consumer Discretionary comes next with a projected gain of 22.7%, followed by real estate with a 22.6% jump. On the other hand, analysts see energy stocks bringing up the rear with a gain of just 10.7%, the smallest expected price increase of the S&P 500’s 11 sectors.

4. Earnings Growth Forecasts vs. Recent Trends

The index’s expected performance is based on lofty earnings growth forecasts, which contrast sharply to the year-over-year earnings declines from the past three quarters. Wall Street analysts expect earnings growth of 12.2% for calendar-year 2024, a number that was reduced slightly last week for the first time in more than two months.

5. Top 10 Optimistic Stocks and Laggards According to Wall Street

Since these estimates for the S&P 500 are based on an aggregate of sell-side analysts’ projections for individual stocks, Butters was able to break out the 10 stocks that Wall Street is most optimistic about, and the 10 that Wall Street expects will lag behind the rest of the index.

6. Recent Stock Market Performance Amidst Rising Treasury Yields

U.S. stocks have been sliding since the start of August, with the S&P 500 having fallen 5.5% since then. Still, the index remains up 13% since the start of the year after finishing Monday’s session at 4,337.44, FactSet data show. Rising Treasury yields, particularly 10-year note and 30-year bond yields, have been widely blamed for triggering the selloff in stocks.