UBS Updates "Highest Conviction" Stock List with Market-Beating Picks

UBS Names Top Stocks for 2023

UBS Stock Picks for 2023

UBS has named a list of U.S. and global stocks that it believes will outperform the MSCI All Countries World Index in 2023. The Swiss bank referred to 2023 as a year of "inflection points" and emphasized that the stocks on its list are its highest conviction picks. These stocks include Baidu, Grab, Merck, Salesforce, Li Ning, and Siemens. UBS recently updated its selection by adding Yum Brands and MGM Resorts International while removing AbbVie and Corteva from the list.

Reasons behind the Stock Picks

UBS chose Baidu, a leading internet company, for its positive outlook on the firm's advertising and improving profitability. Grab, a Southeast Asian ride-hailing company, made the list due to its double-digit growth opportunities and strong competitive position in the region. Merck, a U.S. pharmaceuticals company, was selected for its high-quality business and reasonable valuation, with expectations of increased business development efforts. MGM Resorts International was included for its strength in Las Vegas and favorable outlook, especially with upcoming events like Formula1 and the Super Bowl. Li Ning, a Chinese sportswear company, made the list based on the growth potential of the sportswear industry in China. Salesforce, a software firm, was chosen for its attractive valuation and potential resilience in a slowdown due to recurring revenue and margin expansion efforts. Siemens, a manufacturing and technology company, stood out for its position in the Industrial Internet of Things and focus on efficient transportation. Lastly, Yum Brands, the owner of Taco Bell, was included for its investment in online sales, which has driven significant sales growth.

UBS' Outlook

UBS believes that navigating inflection points in 2023 will present both challenges and opportunities for investors. The bank's "23 for '23" theme highlights its highest conviction stock ideas that aim to benefit from these inflections. The authors of the UBS report, led by Nadia Lovell, emphasized the importance of addressing these inflections for investment success.

Hot Take: Impact on New Businesses

UBS's list of top stocks for 2023 provides valuable insights for new businesses in terms of industry trends and potential market opportunities. By examining the reasons behind UBS's stock picks, new businesses can gather essential information that may guide their own decision-making processes. Here are some takeaways:

1. Emerging Markets: The inclusion of Grab, a Southeast Asian ride-hailing company, and Li Ning, a Chinese sportswear company, highlights the growth potential in these regions. New businesses looking to expand should consider these markets and explore opportunities for entry or partnerships.

2. Technological Innovation: Companies like Baidu and Siemens were chosen for their positions in the technology sector. This emphasizes the importance of staying ahead with technological advancements. New businesses should focus on adopting innovative solutions to enhance their products or services and gain a competitive edge.

3. Customer Engagement: Salesforce's inclusion underscores the significance of customer relationship management software. New businesses should prioritize building strong customer relationships and invest in tools that enable effective communication and support.

4. Shifts in Consumer Behavior: Yum Brands' presence on the list, driven by its investment in online sales, indicates the changing dynamics of consumer behavior. New businesses should recognize the importance of e-commerce and digital sales channels to reach a wider audience and adapt to shifting preferences.

Overall, UBS's stock picks for 2023 serve as a valuable reference for new businesses seeking insights into industry trends and potential growth areas. By leveraging these takeaways, new businesses can position themselves strategically in the market and increase their chances of success in an ever-evolving business landscape.



Article First Published at: https://www.cnbc.com/2023/07/17/ubs-just-updated-its-highest-conviction-stock-list-with-picks-to-beat-the-market.html