On April 23, Stephen Parker, JPMorgan Private Bank co-head of global investment strategy, joined ‘Squawk Box’ on CNBC to express that investors should have a normal level of risk in their portfolios right now. Parker explained that while he is fully in support of remaining invested in the market, he does recommend clients to stay focused on sectors that may be more resilient in a downturn to help protect against losses while staying long. His baseline guidance is for clients to maintain a normal level of risk in their portfolios. Those holding too much cash should get invested, and those overexposed to US markets and the dollar should consider adding non-US exposure. He advised that this is a period where investors must be comfortable with discomfort, as policy uncertainty broadens the range of possible outcomes.

Parker acknowledged that while downside risks are top of mind for many investors, there is also upside potential, especially if there are positive policy surprises, such as clarity on tariffs, which could drive markets back to their highs sooner than expected. His outlook for the S&P 500 index is a wide range, with the high end being flat for the year and a possible range of 5,700-6,200. This reflects heightened policy uncertainty and difficulty in pinpointing a single target. Parker pointed out that even if it takes two years for markets to return to all-time highs, an 8% annual return would still be compelling for equities.  Reflecting on the start of the year, he noted that market multiples were considered rich following 2 consecutive years of 20%+ gains. There was optimism around deregulation and changes to corporate taxes, but few expected the S&P 500 to remain flat for 2 years from a level of 6,200. Parker further explained that even without pro-business policy changes, the market may have faced challenges after such strong recent gains. The pullback in high-performing segments of the US market has brought valuations closer to what he considers normal levels, which also sets the stage for potential upside.

That being acknowledged, we’re here with a list of the 11 most promising stocks according to analysts.

Our Methodology

We sifted through the Finviz stock screener to compile a list of the top stocks that had high analysts’ upside potential (at least 35%). The stocks are ranked in ascending order of their upside potential. We have also added the hedge fund sentiment for each stock, as of Q4 2024, which was sourced from Insider Monkey’s database.

Why are we interested in the stocks that hedge funds pile into? The reason is simple: our research has shown that we can outperform the market by imitating the top stock picks of the best hedge funds. Our quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 373.4% since May 2014, beating its benchmark by 218 percentage points (see more details here).

11 Most Promising Stocks According to Analysts

11. Adobe Inc. (NASDAQ:ADBE)

Number of Hedge Fund Holders: 117

Average Upside Potential as of April 23: 37.30%

Adobe Inc. (NASDAQ:ADBE) is a technology company that operates through its Digital Media, Digital Experience, and Publishing & Advertising segments. It offers its solutions directly to enterprise customers through its sales force and local field offices, as well as directly to businesses and consumers. It also licenses its products to end-user customers through app stores and websites.

On April 4, Mizuho Securities maintained an Outperform rating on the stock with a $575 price target. Despite a challenging year, Mizuho highlighted the company’s recent progress in monetizing its GenAI innovations as a positive sign, as these integrations have been well-received by enterprise customers. For instance, the AI Assistant in Acrobat helps users with tasks like summarizing and editing PDFs.

The web and mobile versions of core applications in Creative Cloud, like Photoshop and Illustrator, had their paid subscriptions grow 35% year-over-year. Creative Cloud and Document Cloud are contained in Adobe’s Digital Media segment and together made $4.23 billion in FQ1, which was up 12% year-over-year. Digital Media’s ARR was also up 12.6% due to the growing subscriptions.

Polen Focus Growth Strategy stated the following regarding Adobe Inc. (NASDAQ:ADBE) in its Q3 2024 investor letter:

“We added to several existing positions in the quarter including Adobe Inc. (NASDAQ:ADBE), Workday, Shopify, MSCI, and Paycom Software. We feel Adobe is poised for re-accelerating revenue and earnings growth partially due to the monetization of its Firefly GenAI product embedded in its creative software.”

10. Meta Platforms Inc. (NASDAQ:META)

Number of Hedge Fund Holders: 262

Average Upside Potential as of April 23: 38.31%

Meta Platforms Inc. (NASDAQ:META) helps people connect and share with friends and family through its Family of Apps (FoA) and Reality Labs (RL) segments. FoA offers Facebook, Instagram, Messenger, Threads, and WhatsApp. Whereas RL provides virtual, augmented, and mixed reality-related products, which include consumer hardware, software, and content.

The company achieved a record $164.5 billion in total revenue in 2024, which is a 22% increase from 2023. Meta AI serves more than 700 million monthly users, which are supported by a 2-gigawatt AI data center and custom AI chips. Moreover, Ray-Ban Meta smart glasses and AI integration across platforms showcase Meta’s wearable tech/AI strategy. Meta has also started integrating Meta AI in Threads, WhatsApp, and Facebook for better engagement.

For FQ1 2025, Meta Platforms Inc. (NASDAQ:META) projects a revenue between $39.5 billion and $41.8 billion. On April 22, Roth MKM reiterated a Buy rating on Meta’s stock and lowered its price target to $580 from $730 despite favoring the company in general due to its AI product catalyst LlamaCon announcements, and a possible change in 2025 OpEx/CapEx guidance narrative.

Nightview Capital highlighted the company’s strong growth potential, due to its AI leadership with Llama model, advertising ecosystem, and AR capabilities. It stated the following regarding Meta Platforms Inc. (NASDAQ:META) in its Q4 2024 investor letter:

“Core Opportunity: Meta Platforms, Inc.’s (NASDAQ:META) platforms—Instagram, Facebook, WhatsApp, and Messenger—reach nearly half the world’s population daily, making it one of the most powerful advertising ecosystems globally. With investments in AI and augmented reality (AR), we believe Meta is also creating significant optionality for long-term growth.

Competitive Advantage: Thriving Core Platforms: In Q3, we saw Meta achieve a 23% YoY revenue growth,—a testament to strong user engagement across its ecosystem. The advertising landscape as a whole continues to evolve and we believe Meta’s existing platforms offer a defined advantage in this new world. Existing platforms in the age of AI continue to be the most powerful indicator of future success in our opinion.

AI Leadership: Meta’s AI capabilities and the Llama AI model are driving efficiency and product innovation. In our view, these assets have been under-appreciated by the market while enhancing Meta’s ability to further scale and innovate its leading advertising business…” (Click here to read the full text)