Four Stocks That Should Outperform the Markets in 2025
These diverse names all have something in common — and it makes them ones to own in the year ahead.
You've reached your free article limit
You've read 0 of 1 free Pro articles.
I want to take a moment to wish happy holidays to all of our readers. Merry Christmas and Happy Hanukkah to those who celebrate. To everyone, may it be a time of peace and joy.
As far as the stock market is concerned, it hasn’t been a December to remember. The S&P 500 (left chart) is red for the month, although a Santa Claus rally could still materialize. The Nasdaq 100 (right chart) has consistently closed above its 50-day moving average (blue), proving that it remains the strongest of the major indexes.
The weakest major index is the Russell 2000 (right chart, below), which hasn’t bounced at all in the wake of last week’s Fed-induced selloff. Apparently, institutional traders chose to lighten up on small-caps at the first hint of a selloff.
The Dow Jones Industrial Average (left chart, below) has fared only slightly better, having managed a weak bounce after a quick plunge. Again, institutions were quick to unload the names in this index.
If institutional traders don’t want small-caps or industrials, what do they want? It’s not just the usual suspects.
Do they want Tesla TSLA and Broadcom AVGO? Tesla (left chart) has gained 74% year to date, but has managed just a feeble bounce from last week’s selloff. Ditto for Broadcom (right chart), which has gained 114% year to date, but remains well off its highs.
Those two names should be fine, but I’m looking for stocks that haven’t sold off at all. If institutions are refusing to sell certain names despite recent turbulence, it could mean they plan to keep and possibly add to these positions in the New Year.
Two names that fit this description are Palantir PLTR and Warby Parker WRBY. Palantir (left chart) has more than doubled since I first recommended it to readers in September. Despite last week’s selloff, Palantir closed at an all-time high on Monday.
New York City-based Warby Parker (right chart), which makes and sells glasses, sunglasses, and contacts, has gained over 70% this year, and is trading at a two-year high. Again, this stock showed no signs of slowing down, despite last week’s selling.
Another name that institutions appear to be holding tightly is Alaska Air Group ALK. This stock (left chart) closed at a three-year high on Monday. In my opinion, Alaska Air Group currently has the best chart in the airline sector.
Canadian-based CAE Inc. CAE (right chart), which manufactures flight simulators and provides training services to airlines, closed at a one-year high on Monday. Since November 1, this stock has gained over 38%.
These four names are still climbing in a rough market. That in itself could be a telltale sign that institutions have no intention of selling these names in the near future.
At the time of publication, Ponsi was long PLTR, WRBY, ALK, CAE, AVGO and TSLA.
