Stock Pickers Say It's A Good Time To Buy Right Now - And Name Their Favorite Stocks

This year's stock market rally hasn't been straightforward. Despite the threat of interest rate hikes, earnings revisions, and recession risks still weighing heavily on investors' minds, the markets have remained volatile throughout this year.

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Investors are urged to be particularly attentive to the companies they invest in against this backdrop, according to several strategists.

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“Obviously, there is a need to have discipline, but this is definitely a stock picker's market at the moment. This means that you need to pay attention to which stocks you own. Generally speaking, we are very careful about where we put our money to work," Nancy Tengler, chief investment officer at Laffer Tengler Investments, told Trade Algo on Tuesday in an interview.

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“If you compare Intel's total return with that of the SOXX [iShares Semiconductor ETF] and the S&P 500, you will quickly see that ownership of Intel has been far more disastrous than owning the SOXX, which has been one of the best investments you can make,” she said.

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This year, the SOXX, which offers investors exposure to a basket of semiconductor stocks that are listed on U.S. exchanges, is up by more than 20%. There has been a decline of nearly 3% in Intel's shares over the course of the last year.

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Michele Schneider of MarketGauge, a trading strategy firm that specializes in trading strategy development, echoes Tengler's assessment. The current macro backdrop is a "stock picker's scenario" that calls for an active trading environment in order to be successful.

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In addition, she went on to say that the market has been stuck in a trading range, as the economy is really not going anywhere in the near future.

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With market risks still weighing on stocks, veteran investor Michael Landsberg, partner, and chief investment officer at Landsberg Bennett Private Wealth Management, said the key to making money moving forward is patience, as well as choosing stocks carefully on an individual basis.

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Stock picks

Tengler believes there are still plenty of places where you can find high-quality companies that are growing dividends and are turning in reliable earnings growth even if some of the stocks in her portfolio have underperformed this year.

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Across all the equity strategies she manages, Broadcom ranks as the single largest holding across all the equity strategies she manages. The chip maker is one of the biggest beneficiaries of the growth in cloud computing and artificial intelligence, according to Tengler.

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“This is the kind of chip stock that you know you are paying for, as it has a lot of AI capacity and gives great guidance for AI, and it also has the best margins compared to all the other semiconductor companies in the space,” she said.

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Aside from EOG Resources, Tengler also likes the company's dividend payouts, claiming they are "handsome" as the company waits for the natural gas price to recover. Currently, the company has paid out $6.80 in special dividends per share since Feb. 2022, as well as $3 in regular dividends per share since Feb. 2022, and a further $1 in special dividends per share is due to be paid in May.

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Currently, the stock offers a dividend yield of 2.7%, which is higher than the industry average dividend yield of 0.8%, according to FactSet data.

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In the meantime, Schneider of MarketGauge is watching defense contractors Raytheon and Northrop Grumman, as both of them are still relatively undervalued when compared to what they could be.

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In contrast, Landsberg says he is interested in pharmaceutical company Eli Lilly, healthcare insurer UnitedHealth Group, and energy company NextEra Energy - all names he describes as being "long-term names that offer us attractive entry points".

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