You have likely heard some type of the disclaimer, “Past performance is not any guarantee of future results.” And the statement is true. Nevertheless, I’d add something to the disclaimer: “But an enormous head start is sort of all the time an excellent thing.”
Several large-cap stocks have an enormous head start that would enable them to complete the yr strong. I predict these will probably be the three best-performing S&P 500 (SNPINDEX: ^GSPC) stocks of 2024.
1. Nvidia
Nvidia (NASDAQ: NVDA) currently ranks as the most important year-to-date winner within the S&P 500. Shares of the GPU maker have skyrocketed over 150%. I do not think Nvidia will surrender its top spot by the tip of 2024.
On Aug. 12, I predicted that Nvidia stock would jump one other 20% or more by year-end. My prediction has almost come true already. One reason why is that a few of the aspects weighing on Nvidia aren’t as worrisome now.
More importantly, though, Nvidia has yet to announce its fiscal 2025 second-quarter results. The corporate is scheduled to supply its Q2 update on Aug. 28. I fully expect one other blow-out quarter for Nvidia, which is able to fuel investor optimism.
I also think the corporate will reassure investors concerning the timing of the launch of its Blackwell-based chips. Blackwell is Nvidia’s newest GPU architecture that CEO Jensen Huang believes will probably be essentially the most successful product in the corporate’s history.
2. Super Micro Computer
Super Micro Computer (NASDAQ: SMCI), commonly known as Supermicro, ranks because the S&P 500’s second-best stock to date this yr. Shares of the knowledge technology infrastructure company have soared around 115%. I expect Supermicro will add to that gain over the subsequent few months.
Will Supermicro’s upcoming 10-for-1 stock split on Oct. 1 provide an enormous catalyst? Perhaps, but I would not count on it. Even when there’s a lift from the split, it could only be a short lived one.
The smarter reason to search for a continued strong performance from Supermicro is the tailwind generated by artificial intelligence (AI). Within the fourth quarter of Supermicro’s fiscal 2024, the corporate generated revenue of $5.31 billion. It projects revenue of between $6 billion and $7 billion in fiscal 2025 Q1. That is a 22% increase in only three months — and far of it stems from AI-related demand.
Supermicro could also profit from Nvidia’s launch of its Blackwell chips. Even when there is a worse-than-expected delay with this launch, though, Supermicro CEO Charles Liang doesn’t think his company will probably be affected an excessive amount of due to the overall demand for its liquid-cooling solutions.
3. Eli Lilly
I’m going out on a limb with my next pick. Three S&P 500 stocks are currently performing higher than Eli Lilly (NYSE: LLY) along with Nvidia and Supermicro. Nevertheless, I even have a hunch this big pharma stock could leap past them to finish the yr because the No. 3 stock within the S&P.
My bullish view about Lilly is predicated largely on my great expectations for the corporate’s tirzepatide franchise. Within the U.S., the drug is marketed under the brand name Mounjaro for treating type 2 diabetes and under the brand name Zepbound for treating obesity. Outside the U.S., it’s marketed as Mounjaro for each indications. Whatever you call it, tirzepatide is already an enormously successful blockbuster drug. Mounjaro raked in $3.09 billion in sales in Q2, while Zepbound made $1.24 billion.
Investors also know that Lilly could have more indications for tirzepatide on the best way. The U.S. Food and Drug Administration (FDA) could make an approval decision on the drug in treating obstructive sleep apnea and obesity by the tip of 2024. Lilly plans to file for regulatory approvals of tirzepatide in treating heart failure with preserved ejection fraction (HFpEF) and obesity later this yr.
We will not overlook Lilly’s recently FDA-approved Alzheimer’s disease drug, Kisunla. I do not search for jaw-dropping sales numbers from the therapy within the second half of the yr. Nevertheless, more regulatory approvals outside the U.S. are possible by the tip of 2024. And if U.S. sales are higher than expected, Kisunla could provide more reason for investors to be enthusiastic about Lilly’s growth prospects.
Must you invest $1,000 in Nvidia straight away?
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Keith Speights has no position in any of the stocks mentioned. The Motley Idiot has positions in and recommends Nvidia. The Motley Idiot has a disclosure policy.
Prediction: These Will Be the Best-Performing S&P 500 Stocks of 2024 was originally published by The Motley Idiot