What to invest in in this difficult context? JP Morgan responds to investor question at a time when strategists and economists are sounding alarm bells about the precarious state of the global economy.
Among the pessimists is the CEO of JP Morgan himself, Jamie Dimon, who recently said the Fed’s efforts to raise rates won’t avert a recession they may not be enough.
Luckily, not all titles are to be thrown away.
While Dimon fears for the economy, JPMorgan analysts see two names bucking the trend and rising in the coming months, with upside margins equal to or greater than +90%.
The two stocks chosen by Jp Morgan
The first name approved by JPM is Norwegian Cruise Lineone of the world‘s largest cruise lines that owns and operates three distinct cruise lines: Norwegian Cruise Lines, Oceania Cruises and Regent Seven Seas Cruises, with a total of 28 shipstraveling to over 490 destinations worldwide.
The last few years have been a long headache for the cruise industry.
Unable to operate during the pandemic, the reopening was a welcome relief. The return to normality, however, was interrupted by concerns about the struggling global economy amid soaring inflation and rising production costs.
However, there seems to be too a plentiful pent-up question and that Norwegian, by focusing on the premium market, is less likely to feel the brunt of a recession.
In the company’s latest quarterly report for the third quarter of 2022, turnover recorded a whopping 958% year-on-year increase, to $1.62 billion, while the company posted earnings per share of -$0.64.
Both results beat expectations.
Now let’s move on to an entirely different industry for JP Morgan’s next pick.
Pliant Therapeutics is a clinical biotechnology company tasked with developing and bringing to market new treatments for a range of fibroses.
The goal is to stop its progression, thus safeguarding the functionality of the organs.
The flagship of the company is the bexotegrast which is being evaluated in Phase 2 trials for idiopathic pulmonary fibrosis (IPF) and primary sclerosing cholangitis (PSC).
Treatments for solid tumors and muscular dystrophy still in the preclinical stage are also being studied.
Pliant’s shares are up 156% in the past 6 months, sparking interest from JPMorgan’s Eric Joseph who sees the stock produce an additional return of 130% over a one-year time horizon.