There is a bunch of stocks that are well positioned for upside in 2025, according to Bank of America. The firm said that companies like Amazon are just too attractive to ignore right now. CNBC Pro combed through Bank of America research to find buy-rated stocks to own in January and beyond. In addition to the e-commerce juggernaut, the names include Henry Schein, Crocs, Chewy and Wells Fargo. Crocs Shares of the shoe company are up more than 4% over the past year, and they have plenty more room to run, according to analyst Christopher Nardone. In a note to clients earlier this week, the analyst said he sees a margin growth inflection on the horizon. “We expect margins will sequentially improve starting in 2Q and more so in 2H as CROX begins to lap the outsized HD [Hey Dude] investments,” Nardone wrote. Crocs completed its acquisition of casual footwear brand Hey Dude in 2022. The analyst said investors are also not giving enough credit to Crocs’ international strategy. “We expect key growth markets in ’25 will be India, China, and Western Europe,” he said. Nardone lowered his price target on shares to $144 per share from $147, but he said the risk/reward is extremely compelling and investors should pounce. “We think the stock is simply too cheap given our expectations for EPS to grow by 10% in F26,” Nardone said. Amazon The e-commerce giant is firing on all cylinders. Analyst Justin Post named the company a top idea in 2025, and he said shares are going higher. “We see potential for acceleration in Cloud revenue growth, further Retail margin improvement, and expect a strong ramp for Prime Video advertising in 2025,” Post wrote. The analyst thinks Amazon has the chops to withstand tightening consumer spending, plus any tariffs put in place by the incoming Trump administration. In particular, Post said Amazon has a slew of tools it can use to reduce the tariff impact, including “shifting exposure to lower-priced countries, increasing US-based 1P [first party] supply and Chinese vendors absorbing some costs….” Artificial intelligence will also play a big role, with “new AI automation in fulfilment and AI shopping capabilities for consumers,” Post said. Shares of the company are up 42% over the past 12 months. Chewy Analyst Curtis Nagle said the online pet supplies retailer is a top pick. Chewy has robust earnings potential, and investors are overlooking it, he said. “Combined with a shift to higher gross margin sales, Chewy should see significant earnings leverage on its at-scale expense base that should, in turn, drive [earnings before interest, taxes, depreciation, and amortization] growth,” Nagle wrote. The analyst also said Chewy is gaining share online, and that it’s making the right investments to grow the business in using private label brands, pet health and more robust advertising. Chewy shares are up 82% over the past year with further upside potential, the firm said. “The pet industry appears to have bottomed with pet adoptions stabilizing and spending improving, which, coupled with share gains, should drive accelerating top-line trends at Chewy,” Nagle said. Crocs “Risk/reward is attractive at 9x P/E. … We think the stock is simply too cheap given our expectations for EPS to grow by 10% in F26. … We expect margins will sequentially improve starting in 2Q and more so in 2H as CROX begins to lap the outsized HD [HeyDude] investments. … We expect key growth markets in ’25 will be India, China, and Western Europe.” Henry Schein “A best-in-class dental asset positioned to win long term. … We think HSIC stands out as a best-of-breed dental asset strategically positioned to compound EPS at healthy rates, which the company accomplished during the entire decade before COVID. The company is anniversarying last year’s cybersecurity incident, which should improve headline numbers, as incremental share losses look manageable.” Wells Fargo “Top pick among our 40+ bank coverage universe. We consider Wells Fargo (WFC) as our top pick across our 40+ bank coverage universe. In addition to a franchise that is well geared towards benefiting from rebounding customer activity (investment banking, lending), we see significant scope for self-help in terms of revenue growth, efficiency improvement, and capital return.” Chewy “The pet industry appears to have bottomed with pet adoptions stabilizing & spending improving, which, coupled with share gains, should drive accelerating top-line trends at CHWY. Combined with a shift to higher gross margin sales, CHWY should see significant earnings leverage on its at-scale expense base that should, in turn, drive EBITDA growth.” Amazon “New AI automation in fulfilment & AI shopping capabilities for consumers. … We see potential for acceleration in Cloud revenue growth further Retail margin improvement & expect a strong ramp for Prime Video advertising in 2025. … Higher prices would likely impact volumes, but we see levers AMZN could pull to mitigate the impact including shifting exposure to lower-priced countries, increasing US-based 1P supply and Chinese vendors absorbing some costs given high competition on the 3P platform.”
