Evercore ISI is sticking by its previous roster of top stock picks heading into the second half. The first half of trading in 2024 was exceptionally strong for equities, with the artificial intelligence boom fueling technology stocks. The benchmark S & P 500 advanced 15%, while the Nasdaq Composite jumped 18.1%. The Dow Jones Industrial Average was the laggard, but still notched a 3.8% climb in the first half. Evercore sees some similar trends persisting in the second half. Its “best ideas” list compiles stocks based on an investment outlook of one year or more. The list includes some AI beneficiaries such as Adobe, but also has stocks that have faced immense pressure over the past three months such as CVS Health and Home Depot . Data is as of Monday, July 1. Adobe Shares of the software company have fallen more than 5% in 2024. However, analyst Kirk Materne thinks Adobe can benefit “as the creative economy is set to accelerate in the coming years” as generative AI broadens the market for its products. ADBE YTD mountain Adobe stock has slipped more than 5% in 2024. Materne maintains an outperform rating on Adobe stock with a $650 per share price target, implying roughly 17% upside ahead. “With a valuation within its historical range on both an absolute basis as well as relative to the broader ‘market multiple’, believe ADBE can continue to grind higher with a multi-year view,” the analyst said. CVS Health Battered pharmacy stock CVS Health has pulled back more than 27% in 2024. The company’s first-quarter earnings and revenue miss , coupled with a trimmed profit outlook, worried investors that CVS could face further trouble ahead and led to a sharp sell-off. CVS YTD mountain CVS Health stock. But Evercore views CVS as its “favorite large cap name with strong long-term fundamentals in growth businesses and cheap valuation vs. peers.” Analyst Elizabeth Anderson maintains an outperform rating on the stock, coupled with a $65 per share price target that implies about 10% upside ahead. Anderson forecasts long-term earnings growth in the mid to high single digits, with the potential for stronger growth if improvements in its Medicare Advantage business, its new pharmacy reimbursement model, or its health-care delivery business materialize. Home Depot Shares of the home improvement retailer have slipped more than 3% in 2024, in reaction to consumers pulling back on large-scale projects and big-ticket items. HD YTD mountain Home Depot stock. High inflation and interest rates have been headwinds for Home Depot, but analyst Greg Melich expects the company’s “industry leading” position will benefit the company when the home improvement market rebounds. “Longer term, support from an underbuilt and aging housing supply should prove supportive to demand above historical averages,” the analyst said. Melich has an outperform rating on the stock and predicts it will reach $415 per share, or about 21% above Monday’s price. Other stocks in the list include Amazon and Delta Airlines .
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