Benzinga - by Adam Eckert, Benzinga Staff Writer.
Satori Fund founder and portfolio manager Dan Niles is out with his top stock picks for 2024 and two Magnificent 7 names are at the top of the list.
What To Know: The Satori Fund's top picks for this year are a mixture of offensive and defensive names, as the firm believes the S&P 500 could either rally significantly in 2024 or suffer a sizable drawdown, depending on the Federal Reserve.
"We believe the S&P could gain another 20% (10% from earnings growth and another 10% from multiple expansion) if the Fed does in fact engineer the first soft landing since 1995," Niles said Wednesday in a social media post.
TOP 5 PICKS 2024As a reminder, Our initial Top 5 picks coming into 2023 had a skew of defense and offense. Those were:
1) $META – Our favorite megacap w/ low valuation & growth
2) $MUFG – Japan abandoning Yield Curve Control eventually
3) $URA – resurgence in nuclear energy… https://t.co/Um7AEIZTbN
— Dan Niles (@DanielTNiles) January 3, 2024
Check This Out: Soft Landing? Don't Bet On It Just Yet: Fed's Barkin Indicates Further Rate Hikes Possible
The Top 5: The top stock on Niles' list for 2024 is Amazon.com Inc (NASDAQ: AMZN).
Amazon tends to gain market share during recession and has a lot of profit margin expansion potential, Niles said this week in a CNBC interview.
The second name on the list is Meta Platforms Inc (NASDAQ: META), which is the only stock that was also on Niles' top stocks list for 2023.
Niles told CNBC that Meta is growing revenue 15% year-over-year and is trading around 25 times earnings, which is much more reasonable than other names in the Magnificent 7, he said.
Apple Inc (NASDAQ: AAPL), for example, had negative 1% revenue growth in 2023 and is trading around 30 times earnings, Niles said.
The third name on Niles' top stocks for 2024 list is Texas Instruments Inc (NASDAQ: TXN).
"Despite two of the Magnificent 7 being top picks on one of the barbell, we are increasingly looking for beaten up names with compelling valuations outside of the Magnificent 7 to drive returns," Niles said in the X post.
Texas Instruments was only up 3% in 2023 so the hedge fund investor expects the stock to outpace some of its peers in the semiconductor space in 2024, he said.
The last two names on the list are ETFs: SPDR Series Trust SPDR S&P Biotech ETF (ARCA:XBI) and KraneShares Trust KraneShares CSI China Internet ETF (ARCA:KWEB).
Both of these ETFs have been underperforming for years and Niles is betting that they are at a valuation tipping point, which could deliver upside to patient investors in 2024, he said.
Read Next: Top Stocks, Sectors Loved By Congress Members Who Traded In 2023: Apple, NVIDIA, Microsoft, Ford And More Stocks To Watch In 2024
Photo: courtesy of Amazon.
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