UBS is rocking a list of top stock picks for next year.
“We believe that the year 2023 is expected to bring a rise in inflation, interest rates and economic growth as financial markets face global challenges,” UBS global financial group. he wrote in a letter.
The list of global, bottom-up products represents “the most satisfying ideas that benefit from the opportunities opened up by these changes, and incorporate smart ideas.”
The benchmark is the MSCI All Country Word Index (NASDAQ: ACWI). There are six additions and five subtractions with one slot open.
“To better reflect our future-oriented approach, we changed the old name ’22’ from ’22’ in November 2022 to ’23 on’23’,” UBS said. “Investment philosophy and stock-picking strategy will not change.”
The index has a security position and is the most heavily in the US, the most heavily in the UK is Info Tech (XLK) and the most heavily Energy (XLE).
- AbbVie (ABBV) – “We believe that the market has been able to punish ABBV for the expected decline in the Humira franchise – as biosimilars will be launched in 2023 in the US – and will not appreciate the growth of ABBV from different types of products.”
- Alexandria Real Estate (ARE) – “a solid investment company with a strong profit margin, sector-leading shares, and a strong and innovative team.”
- CSPC Pharmaceutical (OTCPK: CSPCY) – “CSPC is aggressively growing its oncology license and is one of the few companies developing a second-generation mRNA COVID vaccine, which is expected to receive IND approval from the FDA in 2023.”
- MediaTek (OTCPK:MDTKF) – “Intellectually, we expect its volume to decline over the next few quarters and we see a risk-reward correction in its P/E ratio.”
- Mercedes-Benz (OTCPK:MBGYY) – “Its order book remains strong and we believe the company is well positioned to show consistent growth in 2022 and beyond, which will help the stock move forward.”
- Meta Platforms (META) – “the company is now taking steps to make it more profitable, including reducing the number of people, which can be a source of profits until 2023 … ASP increases over time.”
- ICICI Bank (IBN) – “We are disposing of ICICI to find a semiconductor platform instead.”
- PTT Exploration & Production (OTCPK: PEXNY) – “We are divesting PTT E&P to reduce our significant exposure to energy from the healthcare sector, another global favorite.”
- Reckitt Benckiser Group (OTCPK:RBGPF) – “We are divesting Reckitt Benckiser to create a European retail strategy that aligns well with our ’23 revenue theme.”
- Thermo Fisher (TMO) – “We are offsetting concerns about margin pressure in 2023 as COVID testing stabilizes and FX headwinds.”
- Visa (V) – “We are withdrawing this designation due to concerns that returns in cross-border sectors may stall and reverse as global economic growth slows and other regions enter into crisis.”
- Airbus (OTCPK: EADSY) – “Following the cuts at Airbus caused by the pandemic, we expect the company to increase production in the next few quarters.”
- BAT UK (BTI) – “In our view, BAT should continue to gain market share in its largest market, the US, driven by price and mix. Vapor sales should benefit from the recent increase in Vuse ceramic prices.”
- CapitaLand Integrated Commercial Trust (OTCPK:CPAMF) – “CICT is a project to re-open Singapore’s economy. We believe that the rent changes in Singapore’s office and retail sectors should benefit landlords such as CICT.”
- CP ALL (OTCPK: CPPCY) – “We see the re-opening of the Asian economy as a boon for CP All, as its convenience store business prepares to return to business depressed by the COVID-19 pandemic.”
- Exxon Mobil (XOM) – “Exxon has regained its competitive strength and operating strength, in our view. This, along with a strong earnings ratio and high share price, makes Exxon the best decision among US executives.”
- Glencore (OTCPK:GLCNF) – “In our view it has a number of important features, which benefit from a high quality steel structure and a low carbon world.”
- Johnson Controls (JCI) – “Johnson Controls is expected to benefit from steady demand in non-residential HVAC and building management software despite supply chain issues in FY2Q.”
- Lockheed Martin (LMT) – “We do not believe that multi-year forecasts show strong prospects for higher revenue driven by rising defense spending from the US and its allies.”
- Marriott International (MAR) – “Marriott is cash-strapped and will begin returning cash to shareholders as travel continues to improve.”
- Merck (MRK) – “We think that with more in the pipeline and overcoming drug price fears, MRK can sell very close to its 10-year forecast.”
- NextEra Energy (NEE) – “We view NextEra as one of the best utilities in the US, with strong growth and high performance.”
- Palo Alto Networks (PANW) – “In the long term, we expect the company to play a significant role in the distributed cyber security industry due to its unique platform and acquisition capabilities, as well as its focus on cloud-based security solutions.”
- Roche (OTCQX:RHHBY) – “After some disappointments, the market is giving little value to Roche’s pipeline of late, leaving room for surprises if products like tiragolimab (cancer) or ganterenumab (Alzheimer’s) deliver good Phase 3 data.”
- SLB (SLB) – “SLB, thanks to its global exposure and technical expertise, is expected to benefit from a multi-year increase in global and onshore investment.”
- TotalEnergies (TTE) – The company is “well positioned for the energy transition and will benefit through its sales, battery and solar power, and customer opportunities.”
- United Overseas Bank (OTCPK:UOVEY) – “It is a beneficiary of the regional financial restructuring, while the removal of the regulatory limit would be helpful, in our view.”
SA contributor Bohdan Kucheriavyi has a Buy on META, and says the Metaverse pivot is over.