Stocks To Watch In 2022

Financial markets closed out a strong 2021 with major North American indices up between 20-30% for the 12 month timeframe.  Most sectors were positive with only a few lower, such as precious metals and telecommunications.  Interest rate and monetary policy is top of mind in 2022.  The US Federal Reserve has begun to slow its monetary policy initiatives launched during the height of the COVID pandemic while expectations for 3 interest rate increases to help reduce inflation which is at a 30 year high mark of 7%.

We believe that 2022 will be another positive year for equity markets and we highlight the below stocks;

Walgreens Boots Alliance Inc is showing signs of a breakout from a multi month consolidation between $45-55 where it spent most of 2021 trading between.   The catalysts that will propel the stock higher are increasing earnings from same store sales, in-store COVID vaccinations and sales of PCR testing kits.  As well the company is nearing an agreement to sell off its Boots Alliance operations in the EU with Bain Capital as a lead bidder.  Walgreens is focusing on investing in its digital MD operations Village MD, and focusing on its US operations in general.  Walgreens is reporting Q1/22 earnings on January 6th we expect them to beat on estimates and provide near term updates on asset sales and its progress on digital MD investments.

 

Micron Technology is showing signs of breaking out to new all-time highs.  Demand for memory has increased along with the increasing demand for technology products which require what Micron provides.  In addition, pricing has increased and supply has been impacted by Samsung’s production factory shutdowns in Asia due to Omicron.  We believe Micron is well positioned to benefit from the favourable supply/demand factors.  A close above $97 would be a new all-time price high and position the stock for further moves into the $125-150 price zone in 2022.

Shares of EV auto makers are rallying into the end of 2021 and start of 2022.  Over the weekend Tesla, Xpeng and Nio all reported strong December and full Q4 delivery numbers which came in at the high end of analysts expectations.   We believe 2022 will be another big year in automotive shifts to EV versus ICE.  Shares in all 3 EV makers are showing strong price action with Tesla leading the way.  We believe shares in $XPEV and $NIO offer considerable upside potential in the range of 100-300% for 2022 and both are showing excellent price action and we expect breakouts higher in both.

Stocks To Watch In 2022