In this article, we will discuss the 9 Best Quality Stocks to Buy According to Wall Street Analysts.
On July 8, Mike Akins, ETF Action founding partner, joined ‘Halftime Report’ to discuss growth trades that remain underappreciated in comparison to the AI and semiconductor sectors that dominated the first half of the year. Akins highlighted a trend he described as the “SaaS apocalypse,” where software and cloud computing companies saw their valuations drop from extreme levels. He explained that these companies are now trading in line with, or even below, the broader market, despite maintaining strong growth scenarios. Consequently, he expressed confidence in software and cloud stocks heading into the second half of the year, expecting that upcoming earnings reports will validate the continued necessity of these services for day-to-day operations. Furthermore, Akins points to mid-cap and small-cap names, specifically mentioning D-tech as an example of a thematic strategy focused on disruptive technology. He noted that these smaller-market companies have been left behind by the mega-cap, semiconductor-led market rally, but their analyst-projected earnings growth suggests a positive setup.
Regarding broader opportunities, Akins observed that the market experienced a significant broadening in the first half of the year, pointing out that the Mag 7 stocks were essentially flat year-to-date while the broader market rose 10% and the tech sector rose 20%. He suggested that this trend of market broadening is likely to continue. He identified emerging markets (excluding China) as a key opportunity, though he advised investors to use active management or different weighting methodologies to account for large allocations in memory chips that have seen rapid growth.
Additionally, Akins advocated for small- and mid-cap stocks that screen for quality and profitability, noting that both growth and value styles have performed well in these down-market categories. He concludes that these segments have the potential to continue catching up throughout the remainder of the year, driven not only by revenue and earnings growth but also by the expansion of multiples that have been extremely depressed for several years.
Against this backdrop, lets take a look at some quality stocks according to Wall Street analysts.
Our Methodology
We sifted through the Vanguard US Quality Factor ETF holdings to identify stocks that have an upside potential of at least 15%, and limited our final selection to companies that have recently reported noteworthy developments likely to impact investor sentiment. These stocks are also popular among analysts and elite hedge funds.
Note: All data was sourced on July 8.
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. Insider Monkey’s quarterly newsletter’s strategy selects 14 small-cap and large-cap stocks every quarter and has returned 599.2% since May 2014, beating its benchmark by 372 percentage points (see more details here).
9 Best Quality Stocks to Buy According to Wall Street Analysts
9. Qualcomm Inc. (NASDAQ:QCOM)
Average Upside Potential: 19.26%
Qualcomm Inc. (NASDAQ:QCOM) is one of the best quality stocks to buy according to Wall Street analysts. On June 16, Qualcomm Technologies introduced the Snapdragon Reality Elite platform, designed to support the next generation of immersive spatial computing and mixed reality devices. Featuring significant hardware upgrades, the platform delivers substantial improvements in GPU, CPU, and NPU performance, enabling higher visual fidelity and faster, more complex mixed reality scenarios.
Engineered to advance on-device generative AI, the platform provides 48 TOPS of processing power, allowing it to run large vision and language models directly on the device. These AI capabilities enhance contextual awareness, tracking precision, and real-time interaction, supporting advanced features such as photorealistic avatars and dynamic content generation.
The platform also emphasizes comfort and efficiency, achieving up to 20% longer battery life and cooler operating temperatures than previous iterations. By reducing power consumption and latency, Snapdragon Reality Elite enables the development of sleeker, more comfortable headsets, with the XREAL Project Aura set to be the first device to feature the new technology.
Qualcomm Inc. (NASDAQ:QCOM) develops and commercializes core technologies and products for mobile devices and other wireless products. It operates in three segments: Qualcomm CDMA Technologies, Qualcomm Technology Licensing, and Qualcomm Strategic Initiatives.
8. PepsiCo Inc. (NASDAQ:PEP)
Average Upside Potential: 19.29%
PepsiCo Inc. (NASDAQ:PEP) is one of the best quality stocks to buy according to Wall Street analysts. On July 9, PepsiCo reported mixed second-quarter results as strong international demand was offset by weaker performance in its North American food and beverage divisions. The company posted adjusted earnings per share of $2.20 on $24.18 billion in revenue, topping Wall Street’s revenue expectations of $23.95 billion but missing earnings by one cent.
Domestic volume saw significant pressure, with flat volume for the North American food business and a 4% decline in the North American beverage segment. CEO Ramon Laguarta attributed the softness to tightening consumer budgets driven by inflationary pressures and rising gas prices, which particularly impacted demand in the convenience store channel.
Despite these domestic challenges, PepsiCo Inc. (NASDAQ:PEP) reiterated its full-year forecast, expecting organic revenue to grow between 2% and 4%. Management indicated that while they anticipate a recovery in North American volumes, performance trends will likely improve more gradually throughout the remainder of the year.
PepsiCo Inc. (NASDAQ:PEP) is a global leader in convenient foods and beverages, operating in over 200 countries and territories. The company manufactures, markets, and distributes a wide range of iconic products, including beverages, snacks, and ready-to-drink meals.
7. Allison Transmission Holdings Inc. (NYSE:ALSN)
Average Upside Potential: 20.81%
Allison Transmission Holdings Inc. (NYSE:ALSN) is one of the best quality stocks to buy according to Wall Street analysts. On June 16, Allison Transmission announced a $250 million contract to supply 4040 MX transmissions for BAE Systems Hägglunds’ CV90 MkIV infantry fighting vehicles. Marking the largest tracked defense order in the company’s history, the agreement also includes a $50 million option for additional units.
The 4040 MX is an evolution of the existing 3040 MX, offering increased power and updated electronic controls while maintaining the same physical footprint for seamless engine integration. The design follows two years of rigorous testing to ensure it meets modern combat requirements.
Deliveries for the program are scheduled to commence in 2028. Both companies stated that the partnership reflects a shared commitment to providing robust propulsion solutions to support the evolving operational needs of global armed forces.
Allison Transmission Holdings Inc. (NYSE:ALSN) designs and manufactures automatic transmissions and hybrid propulsion systems for commercial and military vehicles. The company produces buses, trucks, construction equipment, and defense vehicles across global markets. It serves customers such as vehicle manufacturers, fleet operators, and government or defense organizations.
6. Abercrombie & Fitch Co. (NYSE:ANF)
Average Upside Potential: 26.61%
Abercrombie & Fitch Co. (NYSE:ANF) is one of the best quality stocks to buy according to Wall Street analysts. On June 5, Abercrombie & Fitch opened a new flagship store in New York City’s SoHo district at 520 Broadway. Spanning three floors, the location debuts the brand’s “Heritage Meets Modern” design concept, which blends archival storytelling with updated store aesthetics to honor the company’s 134-year history in New York.
The store offers an expanded assortment of men’s and women’s apparel, including signature denim and exclusive city-themed merchandise, alongside a new accessories department featuring footwear, sunglasses, and bags. The space also features curated displays of historical apparel, heritage-inspired furnishings, and a dedicated activation area designed to resemble a classic New York hotel bar.
This opening marks a significant retail expansion, as the brand continues to establish itself as an elevated American lifestyle retailer. Later this month, the company will further grow its presence in the neighborhood when its sister division, Hollister, opens a new location nearby at 547 Broadway.
Abercrombie & Fitch Co. (NYSE:ANF) retails apparel, personal care goods, and accessories. The company operates in the following geographic regions: the Americas, Europe, the Middle East and Africa, and Asia-Pacific.
5. Synchrony Financial (NYSE:SYF)
Average Upside Potential: 31.85%
Synchrony Financial (NYSE:SYF) is one of the best quality stocks to buy according to Wall Street analysts. On June 29, Synchrony announced key executive leadership changes across its Digital platform and Technology and Operations organizations to accelerate digital growth and AI adoption. Carol Juel has been named CEO of Synchrony’s Digital platform, succeeding the retiring Bart Schaller, and will focus on advancing innovation for digital-first partners like Amazon and PayPal.
To support these efforts, Florin Arghirescu has been promoted to Executive Vice President and Chief Technology Officer, where he will lead the enterprise technology strategy and the company’s AI agenda. Additionally, DJ Casto has expanded his role to become Executive Vice President, Chief People and Operations Officer, taking on responsibility for servicing, collections, and customer care to enhance operational excellence.
These leadership appointments are part of a broader effort to scale innovation and strengthen Synchrony Financial’s (NYSE:SYF) core capabilities. By focusing on emerging areas such as agentic commerce and accelerating the integration of AI, the company aims to drive its next phase of growth while continuing to deliver enhanced value to its partners and customers.
Synchrony Financial (NYSE:SYF) is a consumer financial services company operating across the United States. It offers credit products, including commercial credit products, credit cards, and consumer installment loans. The company serves home, telecommunications, outdoor, health & wellness, digital, auto, retail, pet, and other industries.
4. Cirrus Logic (NASDAQ:CRUS)
Average Upside Potential: 35.23%
Cirrus Logic (NASDAQ:CRUS) is one of the best quality stocks to buy according to Wall Street analysts. On May 28, Cirrus Logic introduced a new family of nine audio converters, including ADCs, DACs, and CODECs, aimed at professional and prosumer markets. These devices are designed to provide high-performance audio technology at an optimized price point for mid-tier applications, such as musical instruments, podcast interfaces, mixing consoles, and studio equipment.
The new portfolio features enhanced analog capabilities, including hybrid gain control, which helps designers improve audio performance (specifically by reducing input-referred noise) without increasing system complexity. These additions provide engineers with greater flexibility to differentiate their products while maintaining cost-effective designs across diverse audio equipment lines.
By expanding its converter portfolio, Cirrus Logic (NASDAQ:CRUS) enables manufacturers to scale advanced audio features across multiple product tiers. The new devices complement the company’s existing high-performance families, allowing designers to meet growing market demand for premium sound quality in a broader range of price-sensitive, professional-grade audio applications.
Cirrus Logic (NASDAQ:CRUS) is a fabless semiconductor company that provides low-power, high-precision mixed-signal processing solutions for mobile and consumer applications.
3. Weatherford International (NASDAQ:WFRD)
Average Upside Potential: 40.58%
Weatherford International (NASDAQ:WFRD) is one of the best quality stocks to buy according to Wall Street analysts. On June 1, Weatherford International announced a definitive agreement to acquire NCS Multistage. Under the deal, NCS Multistage stockholders will receive Weatherford common stock or a combination of stock and cash, with the transaction expected to be immediately accretive to adjusted Free Cash Flow per share. The company anticipates realizing at least $15 million in annual cost synergies within 18 months of closing.
The proposed acquisition strengthens Weatherford International’s (NASDAQ:WFRD) completions portfolio by integrating NCS Multistage’s specialized technology, which is designed to optimize well completions and field development, particularly in complex unconventional resource environments. This addition aims to improve operational outcomes for customers across the full lifecycle of a well, from initial design through production optimization.
By utilizing Weatherford’s extensive international footprint, the company plans to scale the reach of NCS Multistage’s product suite to a broader global customer base. Both leadership teams emphasized that the combination enhances Weatherford’s service capabilities and provides a platform for accelerated growth for the technology and personnel formerly associated with NCS Multistage.
Weatherford International (NASDAQ:WFRD) sells products and services for drilling, assessment, and intervention of oil, geothermal, and natural gas wells. It offers equipment for pressure drilling, electrical, and hydraulic power transmission, to name a few. Its service portfolio includes re-entry, fishing, and well abandonment solutions, among others.
2. NVIDIA Corporation (NASDAQ:NVDA)
Average Upside Potential: 46.97%
NVIDIA Corporation (NASDAQ:NVDA) is one of the best quality stocks to buy according to Wall Street analysts. On July 8, NVIDIA announced that its Nemotron 3 Ultra model achieved benchmark-leading performance when paired with LangChain’s Deep Agents harness. By optimizing the surrounding environment rather than retraining the model, the integration reached task parity with top-tier closed models while operating at 10x lower inference costs and significantly higher throughput.
This collaboration allows enterprises to build, customize, and control high-performing AI agents on an open-source stack. By reducing costs and increasing efficiency, teams can now run continuous evaluations and deploy specialized agents across a wider range of business workflows.
Companies like Abridge, Amdocs, and Box are already embedding these agents into their platforms, while EY is leveraging the technology to help clients govern and implement specialized AI. This development reinforces the growing enterprise shift toward high-performance, cost-effective AI systems that offer greater ownership and flexibility.
NVIDIA Corporation (NASDAQ:NVDA) is a fabless semiconductor and AI computing company that designs GPUs, AI accelerators, Application Programming Interfaces (APIs), and system-on-a-chip units. Through its CUDA ecosystem, the company enables industries ranging from autonomous vehicles to scientific research by advancing AI, accelerated computing, and data center infrastructure.
1. ExlService Holdings Inc. (NASDAQ:EXLS)
Average Upside Potential: 51.57%
ExlService Holdings Inc. (NASDAQ:EXLS) is one of the best quality stocks to buy according to Wall Street analysts. On June 12, EXL announced it has achieved Gold Tier status in the Databricks Partner Program, expanding its collaboration to help enterprises build secure data foundations for AI. By integrating EXLdata.ai with Databricks’ governance and security capabilities, the partnership enables organizations to scale AI responsibly while maintaining strict compliance and control.
ExlService Holdings Inc. (NASDAQ:EXLS) is specifically utilizing this partnership to help clients adopt Databricks’ “Bring Your Own Lineage” capabilities. This allows enterprises to govern and audit data across distributed environments, preserving existing technology investments while strengthening operational resilience in highly regulated sectors like banking, insurance, and healthcare.
Both companies aim to accelerate enterprise AI adoption by providing the reliable data and business context necessary for impactful results. This expanded collaboration focuses on delivering the transparency and trust required for businesses to turn complex data into actionable, secure outcomes.
ExlService Holdings Inc. (NASDAQ:EXLS) is a business process management and data analytics company. It provides operations management, decision analytics, and digital transformation services to industries including insurance, healthcare, banking, and travel.
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