5 Leading Stocks to Buy as Recession Fears Ease
U.S. equities have rallied recently, with the benchmark S&P 500 and the tech-heavy Nasdaq both climbing to 15-month highs as economic data has pointed to a resilient economy, with inflation cooling, a solid labor market, and a strong consumer.
Highlighting the euphoria on Wall Street, the blue-chip Dow Jones Industrial Average notched a seventh straight positive session on Tuesday for its longest string of gains since March 2021.
In fact, the Atlanta Fed's influential GDP Now tracker has the U.S. economy growing at an annualized 2.4% pace in the second quarter, slightly higher than its prediction of 2.3% a week earlier.
As such, here are five high-quality stocks worth owning amid the growing view that the economy will manage to dodge a recession.
Home Depot (NYSE:HD) has been riding high lately, with shares of the retail giant rising by almost 10% since mid-April, as investors scale back their expectations for a mild recession this year, thanks to the resilience of the U.S. consumer.
The Atlanta, Georgia-based company is the largest home improvement retail chain in the United States, supplying an assortment of building materials, construction products, and providing various services.
HD stock, which hit a five-month high last week, settled at $316.76 on Tuesday. At current levels, Home Depot commands a valuation of $318.5 billion.
Not surprisingly, HD stock is substantially undervalued according to the quantitative models in Investing Pro: with a ‘Fair Value’ price target of $360.45, Home Depot shares could see an upside of about 14% from current levels.
Additionally, Wall Street has a long-term bullish view on HD, with 35 out of 37 analysts surveyed by Investing.com rating the stock as either a ‘buy’ or a ‘hold’.
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