Buying a stock is easy, but buying the right stock without a time-tested strategy is incredibly hard. So what are the best stocks to buy now or put on a watchlist? Warren Buffett stock Chubb (CB), United Therapeutics (UTHR), Freshpet (FRPT), Broadcom (AVGO) and JPMorgan Chase (JPM) are prime candidates.
Inflation and the Federal Reserve tightening rates aggressively worried investors last year. However, the market confounded expectations for difficulties and turned in an outstanding performance in 2023. More moderate gains were expected for 2024, but the benchmark S&P 500 turned in very strong gains for the first half of the year amid growing confidence that the Fed will reach its goal of a soft landing. The central bank has now started to cut rates, which could further help stocks.
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Tesla Earnings Are On The Horizon. These Are The Two Growth Drivers To Watch.
Best Stocks To Buy: The Crucial Ingredients
Remember, there are thousands of stocks trading on the NYSE and Nasdaq. But you want to find the very best stocks right now to generate massive gains.
The IBD Methodology offers clear guidelines on what you should be looking for. Invest in stocks with recent quarterly and annual earnings growth of at least 25%. Look for companies that have new, game-changing products and services. Also consider not-yet-profitable companies, often recent IPOs, that are generating tremendous revenue growth.
Using such an approach can help give you an edge over the benchmark S&P 500. Outdoing this industry benchmark is key to generating exceptional returns over the long term.
In addition, keep an eye on supply and demand for the stock itself, focus on leading stocks in top industry groups, and aim for stocks with strong institutional support.
Once you have found a stock that fits the criteria, it is then time to turn to stock charts to plot a good entry point. You should wait for a stock to form a base and then buy it once it reaches a buy point, ideally in heavy volume. In many cases, a stock reaches a proper buy point when it breaks above the original high on the left side of the base. More information on what a base is, and how charts can be used to win big on the stock market, can be found here.
Don’t Forget The Stock Market Direction When Buying Stocks
A key part of investing is to keep track of the market. Most stocks, even the very best, follow the market direction. Invest when the stock market is in a confirmed uptrend and move to cash when the stock market goes into a correction.
The stock market turned in stunning gains in 2023 and has been building on those gains so far this year, for the most part. The S&P 500 and the Nasdaq got smacked below the key 50-day moving average after July’s jobs report spooked investors. While there was more choppy action at the start of September, the Nasdaq and the S&P 500 recaptured the important technical benchmark and ended the month with more gains. There has been more progress since then.
The stock market is looking bullish again. Investors should be looking to buy high-quality issues with good growth prospects. The selections below are among the best stocks to buy or watch now. The IBD 50 is also a rich hunting ground.
Nevertheless, it remains crucial to stay on top of sell signals. Any stock that falls 7% or 8% from your purchase price should be jettisoned. Also beware of sharp breaks below the 50-day or 10-week moving average.
Things can change quickly when it comes to the stock market. Make sure to keep a close eye on the market trend page here.
Best Stocks To Buy Or Watch
- Chubb
- United Therapeutics
- Freshpet
- Broadcom
- JPMorgan Chase
Now let’s look at Chubb stock, United Therapeutics, Freshpet, Broadcom and JPMorgan Chase in more detail. An important consideration is that these best stocks to buy and watch all boast impressive relative strength.
Chubb Stock
The Warren Buffett stock is in a buy zone above a flat-base entry of 294.18, according to MarketSurge analysis. This is a first stage base, which is a bonus.
The insurance play has been rallying after getting support at the the 50-day moving average.
In addition, the relative strength line bending higher after a recent dip, an encouraging sign as it breaks out from its pattern.
Overall performance is strong, which is reflected in CB’s strong, but not ideal, IBD Composite Rating of 92.
Earnings performance is also key strength for the stock, with its EPS Rating standing at 92 out of 99.
Indeed, earnings have grown by an average of 57% over the past three quarters, impressive performance by any standard.
Steady growth is expected going forward, with Wall Street analysts seeing EPS rising 9% in 2025.
Revenue growth has popped by 17% in each of the past two quarters.
Investing legend Warren Buffett is a keen backer of the insurance stock. His firm Berkshire Hathaway (BRKB) owns a 6.34% stake in Chubb, worth nearly $6.9 billion with just over 27 million shares.
Buffett’s firm has been building up its CB stock holdings, and it now accounts for 2.56% of its total portfolio.
Buffett first opened a $6.7 billion position in Chubb in mid-May, which prompted a breakout. Berkshire had kept its identity under wraps during its initial accumulation phase, a move that intrigued followers of the Oracle of Omaha.
United Therapeutics Stock
The biotech stock is trading in the buy zone above a consolidation entry of 366.08, MarketSurge analysis shows. This is a second-stage base, a plus. Earlier-stage bases succeed more often.
The relative strength line is inching higher on a weekly chart, though it remains off recent highs. This reflects a stock’s gains vs. the benchmark S&P 500.
UTHR stock has been on a remarkable run this year. It has rallied by 68% so far in 2024.
The stock is ab excellent all-around performer, with its IBD Composite Rating coming in at a near-perfect 98. Earnings performance is strong, with its EPS Rating sitting at 89.
Earnings have soared by an average of 34% over the past three quarters. This is well clear of the 25% growth levels sought by investors following The IBD Methodology.
Ongoing strong earnings are expected by Wall Street, with full-year EPS seen popping 24% before slowing to 14% growth in 2025.
Big Money has been loading up on the stock of late, with its Accumulation/Distribution Rating coming in at A. In total, 68% of UTHR stock is currently held by funds, according to MarketSurge data.
The first quarter represented an inflection point for United Therapeutics. Earlier this year, the company deployed an expanded sales force as it seeks to promote its Tyvaso drug for the treatment of pulmonary hypertension associated with interstitial lung disease, a potentially lucrative area.
Tyvaso is is also used to treat pulmonary arterial hypertension. Together, these two diseases account for about 75,000 patients in the U.S. Additionally, the company is also hoping it can be used to treat idiopathic pulmonary fibrosis. There are about 100,000 patients in the U.S. with this lung disease.
United Therapeutics has several marketed drugs to treat pulmonary arterial hypertension, a type of high blood pressure that affects the arteries in the lungs as well as the right side of the heart.
UTHR is a member of the prestigious IBD Leaderboard list of top stocks.
Looking For The Next Big Stock Market Winners? Start With These 3 Steps
Freshpet Stock
FRPT stock is trading in the buy zone above a consolidation buy point of 136.35, MarketSurge analysis shows. The recent high of 144.38 offers an alternative entry.
This is a second-stage pattern for FRPT. This is a bonus as early-stage bases are more likely to post good gains.
The pet food stock broke out on Aug. 23 and had largely held the buy zone since this tine. It has been getting support at the 10-week moving average, an encouraging sign.
The Bedminster, N.J.-based pet food specialist makes steam-cooked, grain-free and antioxidant-rich meals for dogs and cats. Freshpet exclusively focuses on “fresh” pet food made with fresh meat, vegetables and fruits.
Freshpet has clawed its way to the top of the packaged-food industry group. Stock market performance is particularly strong, with the stock up around 65% so far in 2024. This means it is comfortably outperforming the benchmark S&P 500.
The pet food play is also in the top 5% of issues in terms of price performance over the past 12 months.
The stock holds a strong but not quite ideal IBD Composite Rating of 86. Earnings performance is the weakest part of the picture, with FPRT stock holding an EPS Rating of 72 out of a best-possible 99.
Wall Street expects significant improvement on this front, though. Freshpet is seen swinging from a full-year loss of 62 cents per share in 2023 to a profit of 73 cents in 2024. EPS is then seen popping 80% next year.
Big Money is a strong backer of Freshpet. In total, 75% of shares are held by funds, according to MarketSurge data. An additional 4% is held by management.
Institutions have been net buyers of late, with the stock’s Accumulation/Distribution Rating coming in at B. Noteworthy holders include the well-respected Virtus KAR Mid-Cap Growth Fund Class A Fund (PHSKX). FRPT stock is also an IBD Leaderboard list member.
Broadcom Stock
The chip stock offered aggressive entries in late September as it cleared a trendline and then a short-term high of 172.42. Broadcom pulled back recently but has been getting support at the 10-day and 21-day lines.
For now, the stock is just below a 180.25 handle buy point. It’s hitting resistance at the top of the consolidation, whose left side highs offers an alternate entry of 185.16, according to MarketSurge analysis.
This is a third-stage base, which counts as midstage. The stock is seeing its relative strength line hold steady, and it sits near recent highs.
Shares plunged on Sept. 6 following Broadcom’s fiscal Q3 earnings report but roared back after finding support at the 200-day line.
Excellent all-around performance is reflected in AVGO’s best-possible IBD Composite Rating of 99. Earnings performance is excellent here, with Broadcom holding an EPS Rating of 93 out of 99.
Broadcom’s stock price has ballooned over 61% so far this year. This is easily above the benchmark S&P 500’s lift.
Institutions have been net buyers of AVGO stock of late, with its Accumulation/Distribution Rating coming in at B. Currently, 49% of its shares are held by funds, according to MarketSurge data.
Broadcom serves as an alternative artificial intelligence play for those who believe Nvidia is overvalued. It is a leader in custom chips that companies also need to implement all the power that AI brings to data centers, networks and even connected devices like smartphones.
Bernstein analyst Stacy Rasgon is rating AVGO as one of his top picks in the semiconductor sector. While sentiment around AI chip stocks “has taken a pause,” Rasgon said, “demand clearly has not.” He has a price target of 195 on Broadcom stock.
As if that wasn’t enough, Broadcom is on two different exclusive IBD lists, the Big Cap 20 and Tech Leaders.
These Stocks Are In Buy Zones With Market At Highs
JPMorgan Chase Stock
JPM stock offered an aggressive entry as it recaptured the 10-week moving average.
It is now just below a flat-base buy point of 225.48. This is a second-stage base, which still counts as early. Its latest pattern was formed in over six weeks, MarketSurge analysis shows.
Overall performance is solid, with JPM holding an IBD Composite Rating of 85 out of 99. Earnings performance is an Achilles’ heel, with its EPS Rating coming in at 73 out of 99.
Price performance is better though, with JPMorgan stock among the top 17% of issues in terms of price performance over the past 12 months. The stock has gained more than 32% so far this year.
Big Money has been loading up on JPM stock of late. This is reflected in its Accumulation/Distribution Rating of B-.
Funds own 37% of the Dow Jones stock’s shares, according to MarketSurge data. A further 1% is owned by banks.
The respected Janus Henderson Forty Fund (JARNX) is among the noteworthy holders.
JPMorgan Chase was boosted after the firm posted a 4% EPS decrease to $4.37 on $42.7 billion in revenue.
FactSet expected a 7.8% decline in earnings per share to $3.99 on about 4% revenue growth to $41.43 billion.
The banking behemoth saw assets under management increase by 23% to $3.9 trillion. Net interest income rose 3% to $23.5 billion. Average deposits were down 8% from last year, while average loans rose 1% from 2023.
Please follow Michael Larkin on X, formerly known as Twitter, at @IBD_MLarkin for more analysis of growth stocks.
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