The 22 best stocks to buy for 2022
Several of these top stocks are set to outperform amid a continued or accelerating economic recovery both at home and abroad. Others are more defensively positioned – built to grow should we enjoy smoother waters in 2022, but also able to withstand additional COVID-related disruptions. Other picks are contrarian plays; that is, names that were pummeled in 2021 but could see a big return to favor in the new year.
Nothing has changed. Disney+ is still emerging as the strongest competitor to Netflix (NFLX) and boasts a truly unrivalled catalogue of content it’s assembled over the decades. Disney’s movie business is back, as evidenced by the flurry of Marvel superhero movies planned.
At today’s prices, the communication stock trades at roughly the same levels it did immediately before the pandemic struck. But Disney’s empire has only grown since then. That, and a share lull in late 2021, has DIS poised to be one of the best stocks to buy for 2022.
Even though earnings per share remain likely to be negative in 2022, BofA analysts, citing the company’s improved financial position, an increasing supply of drivers and market share gains, believe the stock could trade at $64 over the next 12 months – an 85% gain from current prices. That very likely would be enough to put it among 2022’s best stocks.
As the population ages, healthcare is a growth industry. And the stock appears well priced after setbacks from hurricanes and because healthcare workers were forced to quarantine due to COVID-19
IAC’s recent agreement to buy Meredith, the publishing company, may provide steadier recurring revenues as soon as 2022.InterActiveCorp’s shares are up 24% over the past 12 months, beating the S&P 500 by 7 percentage points. But it is still valuable because the sum of the parts is worth more than the current price of IAC stock.
For the best stocks to buy for 2022, DXC Technology (DXC, $34.91) is recommended: a midsize information technology company based in the suburbs of Washington, D.C.
Profits are improving, but the stock “is valued at under 10 times current fiscal year earnings.
Alibaba is the leading e-commerce company in China. Growth going forward might be less robust, but shares are cheap and trade at 12.5 times earnings estimates for 2022 – a 66% discount to its long-term average forward price-earnings ratio of 37.
The more technology pervades our life, the more Littelfuse (LFUS, $257.02) stands to gain. The firm designs and makes fuses and circuits – small but necessary components – for consumer electronics, cars and industrial equipment. Cars these days come with heated seats, power steering, lane change assistance and a heated steering wheel, among an increasing list of other things. Each feature requires its own fuse and circuit. Plus, Littelfuse dominates both the electronics and auto markets.
Bank of America
Financial stocks in general could be among the best stocks to buy for 2022 given the potential for interest rates to rise. BAC, which trades at less than 15 times next year’s earnings estimates despite a 54% rally over the past 12 months, looks especially good.
Starbucks is one of the world’s best-run companies, growing steadily with 33,000 outlets worldwide.
Most Americans live within three miles of a CVS pharmacy. But CVS Health (CVS, $93.10) is more than a drugstore; it’s an integral player in each link of the entire health chain. Its Caremark division is a major drug distributor, and its healthcare benefits subsidiary Aetna serves 39 million people. Plus, this top stock for 2022 trades at less than 13 times expected earnings for the year ahead – a discount to its 10-year average forward P/E of 14.