In This Article:
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(1:00) - Breaking Down The Economic Data: Are We Heading For A Recession?
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(5:50) - What Should Investors Expect From The Continued Fed Rate Cuts?
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(11:20) - Top Stock Picks To Keep On Your Radar Heading Into 2025
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(36:10) - Episode Roundup: AAL, MKSI, RCL, AMSN, R
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Podcast@Zacks.com
Welcome to Episode #427 of the Zacks Market Edge Podcast.
Every week, host and Zacks stock strategist, Tracey Ryniec, will be joined by guests to discuss the hottest investing topics in stocks, bonds, and ETFs and how it impacts your life.
This week, Tracey is joined by John Blank, Zacks Chief Equity Strategist, to discuss their annual December topic: is the US economy in a recession or about to go into one?
Recessions aren’t defined by the number of foreclosures or people not paying on their auto loans. No, there is a far more simpler definition which includes looking at employment.
As usual, Tracey and John take a deeper dive into the employment data to look for the real clues.
But they also discussed stocks. Small caps, mids, or big caps for 2025?
5 Stocks for Your 2025 Short List
1. American Airlines Group Inc. (AAL)
American Airlines is riding a strong wave of travel heading into 2025. Earnings are expected to rebound in 2025, with the Zacks Consensus looking for a jump of 30.6%.
Shares of American Airlines are cheap. It trades with a forward price-to-earnings (P/E) ratio of just 10. A P/E under 15 is usually considered a value stock. American Airlines also has a PEG ratio of just 0.3. A PEG ratio under 1.0 usually indicates a company has both growth and value. That’s a rare combination.
Should an airline like American Airlines be on your short list for 2025?
2. MKS Instruments, Inc. (MKSI)
MKS Instruments is a global provider of enabling technologies. It’s a mid-cap company with a market cap of $7.4 billion. Earnings are expected to rise 42.9% in 2024 and another 18.2% in 2025.
MKS Instruments is a Zacks Rank #2 (Buy) stock. It has an attractive PEG ratio of just 0.7. A PEG ratio under 1.0 indicates a company has both value and growth. MKS Instruments also has a forward P/E of just 17.5. That’s above 15, which indicates value, but is below the average for the S&P 500 of 22.
Should a mid-cap like MKS Instruments be on your short list?
3. Royal Caribbean Cruises Ltd (RCL)
Royal Caribbean operates cruises around the world. It is a big cap company with a market cap of $65 billion. Earnings have jumped on strong demand. 2024 earnings are expected to be up 72.1% with another 24% earnings growth in 2025.
