As revealed in the second quarter, many of the largest companies in the S&P 500 managed to surpass Wall Street expectations, set a winning tone for the rest of the year, and determine potential investments that could yield profits as soon as Q4 2024.
Using the previous quarters as parameters, Finbold picked two stocks based on their fundamentals and growth outlooks, which could turn a $1,000 investment into a $10,000 profit.
Dell (NYSE: DELL)
Although it is a lesser-known artificial intelligence (AI) pick that is currently shifting toward storage and server solutions, Dell (NYSE: DELL) demonstrated robust fundamentals in its latest Q2 report on August 29.
In its latest report, Dell revealed a double beat on earnings. Its reported revenue was $25.06 billion, surpassing the expected $24.53 billion. Additionally, the adjusted earnings per share (EPS) reached $1.89, exceeding the anticipated $1.71.
The strategic shift towards server solutions has proved highly beneficial, as its server and networking sector brought in $7.7 billion of revenue in the second quarter, representing an 80% year-over-year increase.
Jeff Clarke, Dell’s COO, said an additional $3.8 billion worth of server deals have yet to be fulfilled, and many deals have yet to be finalized.
Analyst sentiment remains predominantly bullish, as they see Dell as a complementary part of the largest AI player, Nvidia (NASDAQ: NVDA), whose CEO, Jensen Huang, touted Dell as an ideal solution for server and network products.
Dell’s stock jumped 5.74% in the pre-market on August 29 after closing the previous trading session at $110.74, a valuation it reached after a 48.07% year-to-date gain.
DELL stock YTD price chart. Source: Finbold
Abercrombie & Fitch (NYSE: ANF)
For those wishing to diversify their portfolios, Abercrombie & Fitch (NYSE: ANF), a clothing retail store chain, is one of the most attractive picks as it showcased one of the most robust performances outside the technology sector.
In its Q2 earnings report on August 28, the clothing seller announced a beat on earnings as revenue reached $25.06 billion, outperforming the expected $24.53 billion, and adjusted earnings per share (EPS) also exceeded expectations, reaching $1.89 compared to the forecasted $1.71.
The company wants to expand its overseas presence, as the Europe, Middle East, and Africa division sales recorded a 16% increase in the second quarter.
Reinforcing the already-in-line outlook for the entire year, CEO Fran Horowitz said, “We are on track and confident in our goal to deliver sustainable, profitable growth this year while making strategic long-term investments across marketing, digital technology, and stores to enable future growth.”
As of the latest close, ANF shares are trading at a valuation of $142.22. Since January 1, they have increased 56.35%.
ANF stock YTD price chart. Source: Finbold
Despite these two stocks being lesser-known picks, their previous performance in 2024 and positive growth outlook set a solid foundation for further stock price rises over the remaining two quarters of this year.
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Disclaimer: The content on this site should not be considered investment advice. Investing is speculative. When investing, your capital is at risk.
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