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Nasdaq's Rally to Continue in 2H21: 5 Large Cap Stocks to Buy
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Wall Street is likely to display bullish sentiments in the rest of this year, after completing an impressive first half of 2021. Particularly, the tech-laden Nasdaq index continues to rally. On Jul 6, the index reached a new record high of 14,687, closing the trading session up 0.17%.
Moreover, the index has gained 13.7% in the year-to-date period, outperforming the Dow Jones Industrial Average, which returned 12.9%. This growth trajectory in Nasdaq is expected to continue, supported by an unprecedented fiscal and monetary stimulus together with the inherent strength of the U.S. economy despite subsequent fears of a rise in inflation.
Nationwide COVID-19 vaccinations, soaring consumer and business sentiments, the gradual improvement in the struggling labor market, Fed's ongoing easy-monetary policy and the Fed Chairman's reiteration that the inflation is transitory despite raising the inflation forecast for 2021 are paving the way for a northward journey of Nasdaq Composite index in the rest of 2021, boosted by investor confidence.
Markedly, tech stocks constitute more than 50% of weightage in the Nasdaq Composite index. The adoption rate of Internet-based services and apps has been increasing rapidly as people are compelled to stay indoors which is expected to aid index’s rally. Also, the global work-from-home wave is bolstering demand for advanced technology-based virtual meetings and conference tools.
Moreover, the work-and-learn-from-home necessity has propelled demand for PCs, notebooks, peripheral accessories, and cloud storage. Apart from this, blockchain, Internet of Things, autonomous vehicles, AR/VR and wearables offer significant growth opportunities.
Furthermore, improvement in global semiconductor sales is a major positive. Notably, Micron (MU - Free Report) reported better-than-expected results for third-quarter fiscal 2021 driven by chip demand from data-center operators.
Our Picks
Given the above-mentioned positives, here we pick five Nasdaq-listed large caps that are well-poised to grow in the rest of 2021. Large caps have strong fundamentals that help them stay afloat in a turbulent economic and business environment. Each of the five stocks has a market cap of more than $10 billion.
Per the Zacks proprietary methodology, stocks with such a perfect mix of elements offer solid investment opportunities.
Year-to-Date Performance
Image Source: Zacks Investment Research
Zoom Video Communications (ZM - Free Report) continues to add a record number of subscribers and expand its enterprise customer base amid the pandemic-induced remote-working and online-learning wave. Easy to deploy, use, manage and solid scalability make Zoom Video’s software popular among customers.
Moreover, this $114.5 billion company’s efforts to eliminate the security and privacy loopholes, and the launch of hardware and solutions like Zoom From Home, Zoom Phone Appliances and Zoom Events will likely help expand its clientele.
Zoom Video currently sports a Zacks Rank of 1 and a Growth Score of A. The Zacks Consensus Estimate for fiscal 2022 earnings has moved 27% north to $4.66 per share in the past 60 days.
Costco Wholesale Corporation’s (COST - Free Report) operational initiatives to focus on expanding customer reach, cost optimization and strategic investments besides decent membership trends and increasing penetration of e-commerce business have been contributing to its upbeat performance. This $176.3 billion company has been rapidly adopting the omni-channel mantra to provide a seamless shopping experience, whether online or at stores.
To drive online sales, the company launched CostcoGrocery to deliver non-perishable items to buyers’ homes. Its partnership with Instacart facilitates same-day delivery of groceries to shoppers. Also, Costco’s acquisition of Innovel Solutions, a leading provider of third-party end-to-end logistics solutions, — now called Costco Logistics — has boosted its e-commerce capabilities and enables it to sell "big and bulky" items.
This Zacks Rank #2 company has a Growth Score of B. The Zacks Consensus Estimate for its 2021 earnings is pegged at $10.37 per share, having been revised 4.5% upward in the past 60 days.
NVIDIA (NVDA - Free Report) benefits from strong demand for GeForce desktop and notebook GPUs, which boost gaming revenues. Moreover, continuing Hyperscale demand remains a tailwind for this $510.5 billion company’s datacenter business.
Further, NVIDIA’s GPUs are rapidly benefiting from the proliferation of AI. By applying its GPUs in AI models, the company is expanding its base in other untapped markets like automotive, healthcare and manufacturing.
NVIDIA currently carries a Zacks Rank of #2 and a Growth Score of A. The Zacks Consensus Estimate for its fiscal 2022 earnings is pegged at $15.9 per share, having been revised 17.3% upward in the past 60 days.
Apple (AAPL - Free Report) is riding on solid demand for its 5G-enabled iPhone 12 as well as iPad, Mac and wearables. Solid momentum in the Services segment has been a key catalyst.
Furthermore, the pandemic-led work-and-learn-from-home trend is driving sales for its Macbook. Robust adoption of the new MacBook Air and MacBook Pro is acting as a primary tailwind for this $2.3 trillion company.
This Zacks Rank #2 company has a Growth Score of B. The Zacks Consensus Estimate for fiscal 2021 earnings has been revised upward by 1.6% to $5.18 per share in the past 60 days.
Texas Instruments (TXN - Free Report) is an original equipment manufacturer of analog, mixed signal and digital signal processing (DSP) integrated circuits. The company serves diverse end markets where demand typically balances out to generate the steady results it is known for.
This $177.5 billion company is benefiting from an uptrend in personal electronics, owing to the rising demand for electronic gadgets for remote working and entertainment during this pandemic and recovery in the automotive sector.
Its manufacturing strategy involves the use of mature processes of its own where it maintains high utilization rates. This is supplemented with external foundries when demand increases sufficiently.
Texas Instruments carries a Zacks Rank of 2 and a Growth Score of B. The Zacks Consensus Estimate for 2021 earnings moved 0.4% north to $7.39 per share in the past 60 days.
Infrastructure Stock Boom to Sweep America
A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made.
The only question is “Will you get into the right stocks early when their growth potential is greatest?”
Zacks has released a Special Report to help you do just that, and today it’s free. Discover 7 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.
Image: Shutterstock
Nasdaq's Rally to Continue in 2H21: 5 Large Cap Stocks to Buy
Wall Street is likely to display bullish sentiments in the rest of this year, after completing an impressive first half of 2021. Particularly, the tech-laden Nasdaq index continues to rally. On Jul 6, the index reached a new record high of 14,687, closing the trading session up 0.17%.
Moreover, the index has gained 13.7% in the year-to-date period, outperforming the Dow Jones Industrial Average, which returned 12.9%. This growth trajectory in Nasdaq is expected to continue, supported by an unprecedented fiscal and monetary stimulus together with the inherent strength of the U.S. economy despite subsequent fears of a rise in inflation.
Nationwide COVID-19 vaccinations, soaring consumer and business sentiments, the gradual improvement in the struggling labor market, Fed's ongoing easy-monetary policy and the Fed Chairman's reiteration that the inflation is transitory despite raising the inflation forecast for 2021 are paving the way for a northward journey of Nasdaq Composite index in the rest of 2021, boosted by investor confidence.
Markedly, tech stocks constitute more than 50% of weightage in the Nasdaq Composite index. The adoption rate of Internet-based services and apps has been increasing rapidly as people are compelled to stay indoors which is expected to aid index’s rally. Also, the global work-from-home wave is bolstering demand for advanced technology-based virtual meetings and conference tools.
Moreover, the work-and-learn-from-home necessity has propelled demand for PCs, notebooks, peripheral accessories, and cloud storage. Apart from this, blockchain, Internet of Things, autonomous vehicles, AR/VR and wearables offer significant growth opportunities.
Furthermore, improvement in global semiconductor sales is a major positive. Notably, Micron (MU - Free Report) reported better-than-expected results for third-quarter fiscal 2021 driven by chip demand from data-center operators.
Our Picks
Given the above-mentioned positives, here we pick five Nasdaq-listed large caps that are well-poised to grow in the rest of 2021. Large caps have strong fundamentals that help them stay afloat in a turbulent economic and business environment. Each of the five stocks has a market cap of more than $10 billion.
Moreover, they have a favorable combination of a Growth Score of A or B and a Zacks Rank #1 (Strong Buy) or 2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Per the Zacks proprietary methodology, stocks with such a perfect mix of elements offer solid investment opportunities.
Year-to-Date Performance
Zoom Video Communications (ZM - Free Report) continues to add a record number of subscribers and expand its enterprise customer base amid the pandemic-induced remote-working and online-learning wave. Easy to deploy, use, manage and solid scalability make Zoom Video’s software popular among customers.
Moreover, this $114.5 billion company’s efforts to eliminate the security and privacy loopholes, and the launch of hardware and solutions like Zoom From Home, Zoom Phone Appliances and Zoom Events will likely help expand its clientele.
Zoom Video currently sports a Zacks Rank of 1 and a Growth Score of A. The Zacks Consensus Estimate for fiscal 2022 earnings has moved 27% north to $4.66 per share in the past 60 days.
Costco Wholesale Corporation’s (COST - Free Report) operational initiatives to focus on expanding customer reach, cost optimization and strategic investments besides decent membership trends and increasing penetration of e-commerce business have been contributing to its upbeat performance. This $176.3 billion company has been rapidly adopting the omni-channel mantra to provide a seamless shopping experience, whether online or at stores.
To drive online sales, the company launched CostcoGrocery to deliver non-perishable items to buyers’ homes. Its partnership with Instacart facilitates same-day delivery of groceries to shoppers. Also, Costco’s acquisition of Innovel Solutions, a leading provider of third-party end-to-end logistics solutions, — now called Costco Logistics — has boosted its e-commerce capabilities and enables it to sell "big and bulky" items.
This Zacks Rank #2 company has a Growth Score of B. The Zacks Consensus Estimate for its 2021 earnings is pegged at $10.37 per share, having been revised 4.5% upward in the past 60 days.
NVIDIA (NVDA - Free Report) benefits from strong demand for GeForce desktop and notebook GPUs, which boost gaming revenues. Moreover, continuing Hyperscale demand remains a tailwind for this $510.5 billion company’s datacenter business.
Further, NVIDIA’s GPUs are rapidly benefiting from the proliferation of AI. By applying its GPUs in AI models, the company is expanding its base in other untapped markets like automotive, healthcare and manufacturing.
NVIDIA currently carries a Zacks Rank of #2 and a Growth Score of A. The Zacks Consensus Estimate for its fiscal 2022 earnings is pegged at $15.9 per share, having been revised 17.3% upward in the past 60 days.
Apple (AAPL - Free Report) is riding on solid demand for its 5G-enabled iPhone 12 as well as iPad, Mac and wearables. Solid momentum in the Services segment has been a key catalyst.
Furthermore, the pandemic-led work-and-learn-from-home trend is driving sales for its Macbook. Robust adoption of the new MacBook Air and MacBook Pro is acting as a primary tailwind for this $2.3 trillion company.
This Zacks Rank #2 company has a Growth Score of B. The Zacks Consensus Estimate for fiscal 2021 earnings has been revised upward by 1.6% to $5.18 per share in the past 60 days.
Texas Instruments (TXN - Free Report) is an original equipment manufacturer of analog, mixed signal and digital signal processing (DSP) integrated circuits. The company serves diverse end markets where demand typically balances out to generate the steady results it is known for.
This $177.5 billion company is benefiting from an uptrend in personal electronics, owing to the rising demand for electronic gadgets for remote working and entertainment during this pandemic and recovery in the automotive sector.
Its manufacturing strategy involves the use of mature processes of its own where it maintains high utilization rates. This is supplemented with external foundries when demand increases sufficiently.
Texas Instruments carries a Zacks Rank of 2 and a Growth Score of B. The Zacks Consensus Estimate for 2021 earnings moved 0.4% north to $7.39 per share in the past 60 days.
Infrastructure Stock Boom to Sweep America
A massive push to rebuild the crumbling U.S. infrastructure will soon be underway. It’s bipartisan, urgent, and inevitable. Trillions will be spent. Fortunes will be made.
The only question is “Will you get into the right stocks early when their growth potential is greatest?”
Zacks has released a Special Report to help you do just that, and today it’s free. Discover 7 special companies that look to gain the most from construction and repair to roads, bridges, and buildings, plus cargo hauling and energy transformation on an almost unimaginable scale.
Download FREE: How to Profit from Trillions on Spending for Infrastructure >>