Merrill’s quant strategy group unveils their favorite ten stocks for 2014, one from each sector…
Our favorite stock ideas for 2014
We provide a list of 10 S&P 500 stocks for 2014 — one from each of the 10 GICS
sectors. These stocks align with our themes for the year-ahead 2014 and our
quantitative work. This list is intended for the full year, meaning we do not provide
updates intra-year. To come up with our stock ideas, we used the following criteria:
1. S&P 500 stocks which are Buy-rated by BofAML fundamental analysts
2. Review of metrics for favorable valuation, quality, dividend growth or cash
deployment, foreign exposure, GDP sensitivity, fund ownership vs. S&P 500
weighting, BofAML vs. consensus EPS expectations, and/or qualifications
based on other themes in our Year Ahead outlook, such as the potential for
self-help via operational turnarounds, divestitures, etc.
3. After identifying the stocks consistent with the criteria above, we also considered
the views of our fundamental analysts in choosing the stocks for the list.
See the table below for details on our 10 stocks.