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What Are GenZ's Favorite Stocks?

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  • (0:45) - What Can We Learn From Generation Z Investing Trends?
  • (5:40) - Stocks To Keep On Your Watchlist Right Now
  • (37:00) - Episode Roundup: MSFT, NVDA, SG, RDDT, CEG, RIVN, HOOD


Welcome to Episode #398 of the Zacks Market Edge Podcast.

Every week, host and Zacks stock strategist, Tracey Ryniec, will be joined by guests to discuss the hottest investing topics in stocks, bonds, and ETFs and how it impacts your life.

This week, Tracey is joined by Ethan Feller, Zacks Stocks Strategist, to talk about the next generation of investors, GenZ.

The oldest of GenZ are now approaching 30. They have been out in the work force for several years and many of them are now investing in stocks. This generation also came of age with financial apps like Robinhood on their phones already. They have embraced fintech.

What Industries Are GenZ Investing In?

No one would be surprised to know that GenZ investors like technology and don’t like some of the old economy industries like fossil fuels. Tracey also hasn’t heard about them rushing into the bank stocks either.

But clean energy, especially nuclear, appears to be high on their list. And big tech, especially the Mag 7, even if those companies have been around for many decades, are also in the picture.

Some stocks, like Tesla, which were popular with Millennials, appear to be out-of-favor with younger investors. Perhaps Rivian is more their steam?

Every generation also comes of age amidst a new restaurant brand. Baby Boomers had McDonald’s. GenX had Starbucks. Millennials had Chipotle. What will it be for GenZ?

5 Stocks GenZ May Have on their Short Lists

1.      Microsoft Corp. (MSFT - Free Report)

Microsoft went IPO in 1986, well before GenZ was even born. It isn’t exactly a “new” technology company. But it has its hands in many areas, including generative AI thanks to its investment in OpenAI.

Shares of Microsoft are up 7.8% year-to-date after pulling back from recent all-time highs. GenZ likes companies that pay dividends, and Microsoft pays one, currently yielding 0.7%.

Are you surprised GenZers are interested in owning Microsoft?

2.      NVIDIA Corp. (NVDA - Free Report)

NVIDIA is the leader in AI chips in 2024 but prior to AI, it was the leader in gaming. Is it any surprise, then, that GenZ wants to own NVIDIA?

Shares of NVIDIA are up 70.7% year-to-date but have pulled back off their all-time highs over the last month, falling 3.8% in that period. NVIDIA also pays a dividend, currently yielding just 0.02%. It’s just $0.16 a share so investors aren’t really owning it for the yield.

NVIDIA may seem expensive, but it’s trading at just 35x forward earnings.

Is NVIDIA a “generational” must-own stock for GenZ?

3.      Sweetgreen, Inc. (SG - Free Report)

Sweetgreen is a fast-growing restaurant chain that is popular with GenZ and Millennial consumers as it serves healthy food. Sweetgreen shares have taken off in 2024, rising 84% year-to-date. But over the last month, shares have pulled back by 6.3%.

Sweetgreen is still a small cap company, with a market cap of just $2.4 billion.

Will Sweetgreen be GenZ’s generational restaurant chain, like McDonald’s was for the Baby Boomers?

4.      Constellation Energy Corp. (CEG - Free Report)

Constellation Energy is a leading provider of nuclear energy in the United States. It has a market cap of $58.4 billion. GenZ is very interested in clean energy companies. Additionally, Constellation Energy pays a dividend, which GenZ loves. It’s currently yielding 0.8%.

Shares of Constellation Energy are up 57% year-to-date. It still has an attractive PEG ratio, however, of 0.9. A PEG under 1.0 indicates a company has both growth and value.

Should Constellation Energy be on your short list?  

5.      Rivian Automotive, Inc. (RIVN - Free Report)

Rivian manufactures electric vehicles. GenZ has come of age with EVs like Tesla being common place. Why not invest in it?

Shares of Rivian have plunged this year as sales of EV cars and trucks have slowed. Rivian recently announced another round of layoffs. Shares are down 62.3% year-to-date. But earnings are still expected to rise 19.3% this year.

Is this a buying opportunity in Rivian?

What Else Should You Know About the GenZ’s Favorite Stocks?  

Tune into this week’s video podcast to find out.


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