Navigating market volatility, especially concerning potential economic shifts stemming from policies like President Donald Trump’s announced tariffs, requires careful stock selection. Investors often seek companies demonstrating durability during uncertain times. Following this principle, Bank of America (BofA) has identified several equities it believes hold upside potential ahead of their upcoming earnings disclosures, all carrying a “Buy” recommendation from the institution.
Bank of America’s Highlighted Equities
BofA’s analysis points to five specific companies across different sectors, emphasizing their perceived resilience or specific growth catalysts even within a complex macroeconomic environment.
PayPal (PYPL)
Despite acknowledging potentially muted expectations for the immediate earnings report, BofA maintains a positive outlook on PayPal. Analyst Jason Kupferberg noted signs of recovery, although the company might delay confirming its full-year guidance until macroeconomic clarity improves. While the price target was adjusted downward, BofA highlights several positive catalysts expected throughout the year. The bank reiterates its “Buy” rating, citing PayPal’s strong brand, solid balance sheet, strategic flexibility, and current valuation as key strengths, even considering the stock’s year-to-date decline.
Fidelity National Information Services (FIS)
Fidelity National remains a favoured stock for BofA, partly due to its business model. The bank anticipates its upcoming quarterly results could serve as a moderately positive driver for the stock. A significant factor in BofA’s confidence is FIS’s perceived insulation from macroeconomic headwinds, attributed to its limited exposure to discretionary spending and the fact that approximately 80% of its revenue is recurring. Despite a pullback year-to-date, BofA views FIS as offering an attractive risk-reward profile, supported by sustainable margins and cash returns to shareholders.
Flutter Entertainment (FLTR)
Shares of the sports betting giant have experienced a decline year-to-date, but Bank of America suggests this presents a buying opportunity. Analyst Adrien de Saint Hilaire believes current market concerns might be overstated. BofA points to solid underlying fundamentals, despite some potential consumer spending softness and increasing competition. Key growth drivers include continued legalization of sports betting in new US states, Flutter’s robust technology platform, and its international expansion efforts.
Coupang (CPNG)
Bank of America projects that the South Korean e-commerce company will report results largely in line with market expectations. The bank highlights Coupang as one of the few retailers successfully gaining market share while simultaneously improving its return profile. Future earnings growth is expected to be fueled by advancements in its core product commerce segment and progress within its developing offerings unit.
Relx (RELX)
Rounding out the list is Relx, an information and analytics company. BofA notes that the firm currently trades at a discount compared to its peers in the information services sector. The bank identifies several factors that could lead to a positive re-rating of the stock: sustained growth in its risk and business analytics divisions, the strategic implementation of generative artificial intelligence, and continued strengthening within its scientific, technical, and medical segment.
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