JPMORGAN'S TOM LEE: These Are The 23 Best Stocks For The Next 6 Months

Tom Lee

JP Morgan’s Tom Lee is one of the most accurate strategists on Wall Street, having nailed the S&P 500’s path in 2012.

In his brand new note to clients, he offers his list of “23 Ideas For The Next 3-6 Months.”

“Our base case in the short term sees equities higher through the end of 2Q and Cyclicals outperforming (dead cat bounce, 1Q laggards leading in 2Q, etc.),” he wrote. “However, there is a case to be made that Cyclical leadership will likely be a three- to five-year story with Technology, arguably the least consensus, therefore perhaps best positioned”

Lee’s picks run the gamut from biotech to semiconductors to retail.

The group boasts an average 2013 estimated price-to-earnings ratio of 12.3x and an average upside potential to their target prices of 13%.

23) CBL & Associates Properties Inc.

Ticker: CBL

Sector: Retail REITs

Target price: $25

Dividend yield: 3.7%

Comment: CBL was recently upgraded to 'buy' by Goldman Sachs based on the belief that fears about tenant risk are overrated.

Source: JPM, Zolmax

22) General Dynamics

Ticker: GD

Sector: defence

Target price: $75

Dividend yield: 2.9%

Comment: General Dynamics just reupped with the Pentagon to the tune of $180 million for more land systems.

Source: JPM, Crain's

21) Texas Instruments

Ticker: TXN

Sector: Semiconductors

Target price: $37

Dividend yield: 2.4%

Comment: Texas Instruments remained the No. 1 global supplier of industrial semiconductors in 2012.

Source: JPM, Dallas News

20) Staples

Ticker: SPLS

Sector: Office supplies

Target price: $14

Dividend yield: 3.3%

Comment: Staples just hired an executive away from GroupOn to helm its e-commerce division.

Source: JPM, Chicago Tribune

19) KeyCorp

Ticker: KEY

Sector: Finance

Target price: $10.50

Dividend yield: 2.0%

Comment: KeyCorp is expected to increase its dividend 10% to $0.055 a share, and will repurchase up to $426 million worth of stocks.

Source: JPM, Cleveland Plain Dealer

18) Boeing

Ticker: BA

Sector: Aerospace

Target price: $98

Dividend yield: 2.1%

Comment: Boeing says it's increased the rate at which it is able to produce Dreamliners.

Source: JPM, Reuters

17) Prudential

Ticker: PRU

Sector: Financial

Target price: $69

Dividend yield: 2.7%

Comment: Prudential's 'guarantee-free' variable annuity has a 'markedly better' risk profile than normal ones, Citi says.

Source: JPM, Financial Times

16) Time Warner Cable

Ticker: TWC

Sector: Cable

Target price: $103

Dividend yield: 2.3%

Comment: Time Warner is looking to expand its WiFi to more cities.

Source: JPM, CableFax

15) Xilinix

Ticker: XLNX

Sector: Semiconductors

Target price: $41.00

Dividend yield: 2.3%

Comment: Xilinx projects revenue growth of 1% to 5% sequentially, or to a range of about $537 million to $559 million.

Source: JPM, Dow Jones

14) Wells Fargo

Ticker: WFC

Sector: Financial

Target price: $41.00

Dividend yield: 2.6%

Comment: Wells Fargo shares recently hit a 52-week high and has a year-to-date return of 11.4%.

Source: JPM, Zacks

13) CenturyLink

Ticker: CTL

Sector: Telecom

Target price: $40

Dividend yield: 8.3%

Comment: CenturyLink's business strategic revenue grew over 6% in Q1.

Source: JPM, Seeking Alpha

12) analogue Devices

Ticker: ADI

Sector: Semiconductors

Target price: $51

Dividend yield: 2.6%

Comment: CenturyLink's business strategic revenue grew over 6% in Q1.

Source: JPM, Seeking Alpha

11) Best Buy

Ticker: BBY

Sector: Retail

Target price: $29

Dividend yield: 3.1%

Comment: Best Buy recently earned praise for its restructuring, including pulling out of Europe.

Source: JPM, Seeking Alpha

10) Comtech

Ticker: CMTL

Sector: IT

Target price: $29

Dividend yield: 4.5%

Comment: Comtech just won a $29 million contract from the Navy.

Source: JPM, Business Wire

9) Pfizer

Ticker: PFE

Sector: Pharmaceuticals

Target price: $33

Dividend yield: 3.0%

Comment: Pfizer will now start selling Viagra online.

Source: JPM, UPI

8) St. Jude Medical

Ticker: STJ

Sector: Biotech

Target price: $49

Dividend yield: 2.3%

Comment: St. Jude is now the second-largest firm in the pacemaker industry.

Source: JPM, Times Union

7) Carlyle Group

Ticker: CG

Sector: Private equity

Target price: $37.50

Dividend yield: 2.1%

Comment: Carlyle is planning a push into Japan.

Source: JPM, Wall Street Journal

6) Apple

Ticker: AAPL

Sector: Tech

Target price: $545

Dividend yield: 2.4%

Comment: Apple was just endorsed by Jeff Gundlach who said that if forced to choose he would own its shares.

Source: JPM, Business Insider

5) Teva Pharmaceutical

Ticker: TEVA

Sector: Pharmaceuticals

Target price: $46

Dividend yield: 2.6%

Comment: Teva, based in Israel, just signed a deal to sell a new psychiatric drug in the U.S.

Source: JPM, Yahoo

4) CA Inc.

Ticker: CA

Sector: IT

Target price: $34

Dividend yield: 4.0%

Comment: CA raised its full-year earnings outlook on a successful appeal of its past federal income tax payments.

Source: JPM, 4-Traders

3) Vertex Pharmaceuticals

Ticker: VRTX

Sector: Pharmaceuticals

Target price: $100

Dividend yield: 0.0%

Comment: Vertex just announced progress in a cystic fibrosis treatment.

Source: JPM, Forbes

2) Domtar

Ticker: UFS

Sector: Paper products

Target price: $95

Dividend yield: 2.3%

Comment: Domtar just boosted its dividend by 22%.

Source: JPM, Motley Fool

1) Gilead

Ticker: GILD

Sector: Biotech

Target price: $75

Dividend yield: 0.0%

Comment: Gilead recently hit an all-time high on gains for its Hepatitis C drug.

Source: JPM, Bloomberg

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