Nine ‘buy’ ideas and one ‘sell’ idea for Q2 according to BofA
Apr. 01, 2025 11:51 AM ET
By: Monica L. Correa, SA News Editor
BofA highlighted 10 top stock ideas that could have significant market and business catalysts in the second quarter.
The following are nine high-conviction “buy-rated” stocks and a “sell-rated” one across several industries.
“Uncertainty around potential tariff announcements slated for April 2nd dominates market headlines,” said Anthony Cassamassino, senior product marketing manager at Bank of America. “Our economics team expects a combination of reciprocal and sector-specific tariffs with a base case of a 5 percentage points increase in effective tariffs vs. pre-election, while our strategy team estimates a realistic bad case could result in a 10% hit to S&P ( SP500) EPS.”
Here are the buy-rated stocks
Agnico Eagle ( AEM) – price objective: $119
“Near-term, tariff and geopolitical risk could keep upward pressure on the gold price, as should buying from the Chinese insurance industry, central banks, and retail investors. We see Agnico Eagle Mines ( AEM) as the ideal vehicle for gaining that exposure.”
AMETEK ( AME) – price objective: $225
“Broader leading indicators of demand, such as the US manufacturing PMI and OECD US leading indicators have turned up. These historically have had a good correlation with Ametek’s organic revenue growth with a two-quarter lag.”
Bath & Body Works ( BBWI) – price objective: $45
“1Q and F25 sales growth guidance of 1-3% represents a nice inflection and could prove conservative if collaborations drive incremental sales, candles return to growth or new launches gain incremental traction.”
Eli Lilly & Co ( LLY) – price objective: $1,000
“Category sales - when also considering diabetes, and patients that have both obesity and diabetes - could top $150B or more on our estimates in the mid-2030s. Apart from obesity, the rest of LLY's business is simultaneously in good shape across disease areas such as oncology, immunology, and Alzheimer's disease.”
Energy Transfer ( ET) – price objective: $23
“Mid-2025 startup of major Natural Gas Liquids (NGL) export expansion: NGL exports are at capacity from the US, and we anticipate that when this $1.5b capex project starts online it will ramp quickly through the end of the year.”
Goldman Sachs ( GS) – price objective: $700
“We see the potential for a strong trading environment to persist given Trump policy actions and rapid changes to outlook for global monetary policy, regulatory relief on capital and on day-to-day running of the business (June stress test results watched), steady execution on improving firmwide profitability and growing the contribution from the asset and wealth management business all as potential catalysts to drive investor interest into the name.”
Ralph Lauren ( RL) – price objective: $318
“We think RL offers an attractive risk/reward at 9x EV/EBITDA due to the combination of strong global brand heat, structural margin drivers, a strong balance sheet, and a diversified supply chain.”
RenaissanceRe ( RNR) – price objective: $426
“We expect 1Q25 earnings results to be a positive catalyst as investors digest that, in a quarter with significant LA wildfire losses, the company nearly broke even (with what we forecast to be modest book value per share growth).”
The Trade Desk ( TTD) – price objective: $130
“We see the opportunity as unchanged and believe TTD will be able to weather these concerns and outperform, driven by secular drivers including…continued shift of traditional media advertising…sustained momentum in CTV…the unlock of retail media/data…ramping adoption of OpenPath…and growth in audio.”
Here is the stock rated “underperform”
Hims & Hers ( HIMS) – price objective: $22
“HIMS' recent revenue acceleration is driven by a loophole in federal drug regulations (FD&C Act and FDA guidance) that allows compound pharmacies to sell drugs while the branded versions are on shortage. However, this drug (semaglutide) is no longer in shortage, meaning HIMS will need to exit this business by May 22nd.” |
