As the new year begins, Bank of America has a few short-term stock recommendations for investors looking to navigate the quarter ahead. Stocks made fresh all-time highs in 2024, pushing the S & P 500 to notch two consecutive years of annual gains above 20%. Wall Street continued its bets on artificial intelligence-related trades, across energy and technology, and remained optimistic on inflation progress and economic growth. “This remains a stock pickers market,” analyst Anthony Cassamassino wrote in a Thursday note to clients. Here are some of the firm’s top buy-rated picks for the first quarter: Bank of America is staying bullish on Chevron , forecasting roughly 24% potential upside ahead for the stock. The firm reiterated its buy rating on the oil producer on Dec. 10 and added the company to its “US 1 list,” which represents a slate of investment ideas from its buy-rated U.S. coverage. Chevron shares were down slightly over the past year. The company has struggled due to lower margins on its refined product sales and amid uncertainty over Chevron’s pending $53 billion acquisition of rival Hess. PayPal is another stock Bank of America is optimistic on. Analyst Jason Kupferberg upgraded shares to buy from neutral on Dec. 9, forecasting ample free cash flow generation and stock buybacks ahead as the payments company has already made ample progress in its growth initiatives. The company’s upcoming investor day on Feb. 25 could also be a positive catalyst for the stock, he said, assigning a price target that now implies roughly 21% potential upside from Tuesday’s close. “Just over a year after C-level management change, PYPL is demonstrating increased turnaround progress, warranting a higher valuation multiple,” Kupferberg wrote in the December note to clients. “We see potential ’25 acceleration in underlying TP [transaction profit] growth, recent holiday season e-comm spending data points have been encouraging, and we don’t think potential modest improvement in branded TPV [total payment volume] growth is priced in.” Online pet food retailer Chewy , cloud-based advertising company Trade Desk and Wells Fargo are among the other names that made Bank of America’s list of short-term ideas for the first quarter. Trade Desk, which rose 66% over the past year, could gain nearly 32% from its most recent close, according to Bank of America. The firm remains bullish on the company’s “longer-term fundamental thesis,” particularly on its competitive positioning in the digital ad market. The compay stands to benefit from ad dollars shifting from traditional media to online channels as it should lead to higher spending on Trade Desk’s platform.
Bank of America’s top trade ideas for the first quarter