It’s clear to anyone who follows the market which stocks outperformed in 2023. Artificial intelligence and weight loss drug companies led the way. But what about the year ahead? Which securities will ascend to new heights in 2024 and pull the market up with them? Analysts and market commentators are busy with their predictions and forecasts for the coming year. This led us to coming up with this list of stocks to watch in 2024.
Here at InvestorPlace, several names standout as potential winners in 2024. Companies that are leaders in their respective sector and have strong catalysts to propel them forward seem like safe bets. Many stocks are ending 2023 in the red and remain undervalued, making now a great time to buy. Here are the top three stocks to watch in 2024.
Amazon (AMZN)
Multiple analysts on Wall Street are naming e-commerce giant Amazon (NASDAQ:AMZN) a top stock pick for 2024. This includes Piper Sandler (NYSE:PIPR), which has raised its price target on AMZN stock to $185 a share, implying 22% growth from current levels, while maintaining a “Buy” equivalent rating. Piper Sandler also named Amazon its top large cap stock pick for the year ahead. This makes sense as Amazon has spent much of 2023 readjusting its business after the pandemic and now looks ready to capitalize.
Not only has Amazon reduced its headcount, canceled expensive projects, and made its overall e-commerce operation leaner and more efficient, but it continues to push into new areas ranging from streaming to artificial intelligence (AI). Heading into 2024, Amazon looks positioned for a strong growth spurt that could send its share price higher. While AMZN stock has gained 78% in 2023, the share price remains nearly 20% below the all-time high it reached in July 2021 when CEO Andy Jassy took the helm.
Nio (NIO)
Chinese electric vehicle maker Nio (NYSE:NIO) has been on a bumpy road in 2023. Year-to-date, NIO stock is down 13%. However, the company just got a holiday gift that sent its share price up 12% and reignited hope for the coming year. The good news is that Nio is receiving a $2.2 billion investment from Abu Dhabi-based investor CYVN Holdings. The new investment increases CYVN’s holding in Nio to 20% after a previous investment of $738.5 million and a share purchase of $350 million earlier this year.
With the new investment, CYVN becomes the largest shareholder of Nio. It also gives CYVN the right to nominate two directors to the company’s board. More importantly, the investment solves a problem that had been weighing on NIO stock. For the past few months there had been concern that the cash-strapped EV maker would need to raise up to $3 billion of new capital. Now, it looks like Nio has the financing it needs to focus on growing and capturing market share both within China and globally.
Southwest Airlines (LUV)
Airline travel in the United States has come all the way back from the ravages of the Covid-19 pandemic when borders were closed and aircraft sat idle on tarmacs around the world. Airlines in the U.S. transported a record number of people over the Thanksgiving weekend this year, while seven of the 10 busiest days for air travel in U.S. history have occurred in the past six months, according to data from the Transportation Security Administration (TSA) that screens passengers at airports across the country.
This is all to say that now is a good time to buy airline stocks. And a top recommendation is Southwest Airlines (NYSE:LUV). The carrier’s stock is well-positioned to fly high (pun intended) in 2024 after it agreed to a record $140 million settlement related to its December 2022 systemwide meltdown that led to thousands of flights being canceled and more than two million people being stranded. In a statement, Southwest Airlines said it has “learned from the event, and now can shift its entire focus to the future.”
Putting the December 2022 chaos behind it can only be a good thing for LUV stock, which is down 12% on the year and ready for a comeback.
On the date of publication, Joel Baglole did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.