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7 Top-Rated Blue-Chip Stocks Wall Street Analysts Are Loving Now: January 2024

Analysts continue to sing the praises of many companies and their stocks. While 2024 has gotten off to a problematic start, many stocks are still attractively valued and well-run and have catalysts that are likely to push their share prices higher in the coming months. Given the rocky start to the year, stocks of blue-chip companies seem particularly popular with analysts right now. These are established companies that are profitable and have stable and predictable earnings. Blue-chip stocks are often popular during periods of market volatility and uncertainty, such as we’re experiencing now. With Treasury yields rising, tensions escalating in the Middle East, and the timing of interest rate cuts uncertain now would be a good time to shift some capital into stable blue-chip names. Here are seven top-rated blue-chip stocks Wall Street analysts are loving now: January 2024.

Top-Rated Blue-Chip Stocks: Goldman Sachs (GS)

In this photo illustration the Goldman Sachs Group (GS) logo displayed on a smartphone screen and a stock market graph in the background

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Investment bank Goldman Sachs (NYSE:GS) looks to be back in the good graces of analysts after its strong fourth-quarter financial results. The Wall Street powerhouse reported Q4 numbers that beat forecasts due to a big boost in its wealth management unit. Goldman announced earnings per share (EPS) of $5.48, which was better than the $3.62 consensus forecast. Revenue in the October through December quarter totaled $11.32 billion versus $10.80 billion that had been expected.

Goldman Sachs’ latest profit was up an impressive 51% from a year earlier. The Q4 print is a comeback for the company, which has struggled over the last 18 months following a failed push into consumer banking. The firm continues to get most of its revenue from deals such as mergers and acquisitions (M&A) and initial public offerings (IPOs). However, investment banking fees declined 12% from a year earlier in Q4 amid a continued lack of deals on Wall Street. Fortunately, that decline was offset by a 26% rise in equity trading and a 23% increase in wealth management during Q4. GS stock is up nearly 10% in the last year.

Home Depot (HD)

Home Depot (HD) sign backdropped by blue sky

Source: Rob Wilson / Shutterstock.com

Analysts continue to raise their ratings and price targets on Home Depot’s (NYSE:HD) stock. Analysts at Piper Sandler are the latest to take their rating on HD stock to “buy” from “hold” previously amid an expected upturn in home improvement spending this year. Days before Piper Sandler’s upgrade, analysts at Wedbush lifted their rating on the stock to “outperform” from “neutral” and increased their price target to $380 a share from $330 previously.

Analysts have been tripping over themselves to upgrade HD stock ever since the retailer posted strong financial results for last year’s third quarter. Analysts also anticipate a turnaround in home improvement spending this year as interest rates decline and mortgage rates improve. Many analysts also expect Home Depot to benefit from a continued surge in spending by professional contractors and building companies. Since bottoming at the end of October, HD stock has gained 30%.

Top-Rated Blue-Chip Stocks: AutoZone (AZO)

An AutoZone (AZO) storefront in Saint Augustine, Florida.

Source: Robert Gregory Griffeth / Shutterstock.com

Whitney Tilson of Stansberry Research is out with a bullish note on AutoZone (NYSE:AZO), the aftermarket automotive parts and accessories retailer whose stock has been a long-term outperformer. Tilson points out that AutoZone has trounced the broader market over the last 20 years through a combination of growth and share repurchases. Since it began its stock buyback program in 1999, AutoZone has repurchased 88% of its own stock, more than just about any other publicly traded company.

At the same time, AutoZone has grown very fast, with revenue rising more than 400% and operating income up more than 800% over the last 25 years. The combination of growth and stock buybacks has pushed AZO stock up about 10,500% since the Millennium, including tripling in the last five years. Yet despite the massive gains, AutoZone’s stock does not look richly valued right now, trading at 19 times future earnings estimates.

Microsoft (MSFT)

Microsoft logo close up. Microsoft (MSFT) Flagship Store Fifth Avenue, Manhattan, NYC.

Source: The Art of Pics / Shutterstock.com

Each day seems to bring with it a new analyst upgrade to Microsoft (NASDAQ:MSFT) stock. Wells Fargo is the latest Wall Street firm to throw some love on Microsoft’s way, raising its price target on MSFT stock to $435 per share from $425 and maintaining its “buy” rating. Wells Fargo says Microsoft has many more artificial intelligence (AI) products in its pipeline that it can monetize over the coming year.

The Wells Fargo upgrade comes on the same day that Microsoft announced a new strategic partnership related to AI with British telecommunications company Vodafone (NASDAQ:VOD). Microsoft has signed a 10-year deal that will see Vodafone invest $1.5 billion in customer-focused AI that it develops using Microsoft’s Azure OpenAI and Copilot technologies. In turn, Microsoft will become an equity investor in Vodafone’s Internet of Things (IoT) platform when it is spun out as a separate business in April this year.

MSFT stock has increased 62% in the last 12 months.

Top-Rated Blue-Chip Stocks: Lululemon (LULU)

Lululemon storefront in a mall. People shop inside the store among the clothes. LULU stock.

Source: lentamart / Shutterstock

Analysts at Stifel Financial have raised their price target on shares of Lululemon Athletica (NASDAQ:LULU) to $596 a share from $529 previously and maintained a “buy” rating on the stock. The new price target from Stifel represents a 27% upside from where LULU stock is currently trading. The firm argues that Lululemon should benefit in the year ahead from margin expansion and “brand specific (earnings) drivers.”

Stifel is one of several analysts to raise their rating on LULU stock after the company delivered strong financial results and raised its fourth-quarter sales and profit forecasts following stronger-than-expected sales during the December holidays. In an early January news release, Lululemon said it now expects Q4 revenue of $3.170 billion to $3.190 billion and a profit of $4.96 to $5 for Q4 2023. Both numbers are above the company’s previous forecast.

LULU stock has risen 45% over the last 12 months.

Advanced Micro Devices (AMD)

Advanced Micro Devices, Inc. (AMD) logo in the building at CNE in Toronto. AMD is an American semiconductor company.

Source: JHVEPhoto / Shutterstock.com

Speaking of Stifel, analysts at the firm, also like Advanced Micro Devices (NASDAQ:AMD), recently raised their price target on the stock to $170 from $145 and reiterated a “buy” rating on the shares. Stifel likes that the semiconductor company has a strong balance sheet and ties to secular growth trends related to AI. Stifel’s bullish call on AMD stock at the end of 2023 looks to be accurate. So far, in 2024, the company’s share price has risen 13%, including a 7% gain on Jan. 16.

The breakout in AMD stock is credited to rising optimism related to AI and other analyst upgrades of the shares. There’s also a lot of hype surrounding a new series of microchips called the “Ryzen 8040” that AMD unveiled right before Christmas and that the company expects to boost AI applications by up to 60%. AMD has also launched its new MI300X accelerator chip for data centers and servers that competes directly with rival Nvidia’s (NASDAQ:NVDA) data center chips.

AMD’s stock is up 120% over the last 12 months.

Top-Rated Blue-Chip Stocks: Broadcom (AVGO)

broadcom (AVGO) logo outside office building

Source: Sasima / Shutterstock.com

Another chip stock that analysts have been upgrading in recent weeks is Broadcom (NASDAQ:AVGO). Earlier in January, Bernstein lifted its price target on AVGO stock to $1,250 per share from $1,150 and kept a “buy” equivalent rating on the shares. Bernstein and others were impressed with Broadcom’s most recent earnings print, delivered in December. The microchip and semiconductor company posted results that beat Wall Street forecasts on both the top and bottom lines.

Broadcom reported EPS of $11.06 for what was its fiscal fourth quarter, topping the consensus expectation of $10.96. Revenue in the period came in at $9.3 billion, matching analyst expectations. The company’s microchips and semiconductors are used in networking, broadband, server storage, and wireless products, all of which are in high demand. Management has also said they are seeing an increase in the demand for generative AI.

AVGO stock has gained 93% over the last 12 months.

On the date of publication, Joel Baglole held long positions in MSFT and NVDA. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Joel Baglole has been a business journalist for 20 years. He spent five years as a staff reporter at The Wall Street Journal, and has also written for The Washington Post and Toronto Star newspapers, as well as financial websites such as The Motley Fool and Investopedia.

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