Investing

Merrill Lynch Out With Top 10 Stock Ideas for Q4

Liberty Interactive/QVC Group

This is another media and content play the Merrill Lynch team likes for the fourth quarter. Liberty Interactive/QVC Group (NASDAQ: QVCA) is a tracking stock that consists of Liberty Interactive’s subsidiaries QVC and Zulily and its 38% interest in HSN.

QVC is a global home shopping network, which also operates a sizable e-commerce business at 44% of sales. Zulily is a curated flash deal e-commerce site that primarily features small brands and targets a millennial mom customer.

Merrill Lynch has set its price target is $30, and the consensus target is $28.50. Shares changed hands on Thursday at $23.65.

Steel Dynamics

Merrill Lynch has remained very positive on Steel Dynamics Inc. (NASDAQ: STLD), which operates six steel mini mills in Indiana, Virginia, Mississippi and West Virginia. Production capacity has been nearly 10 million tons of a total 110 million U.S. capacity.

The company makes flat rolled products, special/merchant bars and structural steel products. Steel Dynamics can process about 7 million tons of ferrous scrap and has a downstream operation that processes finished steel.

Shareholders receive a 1.71% dividend. The $44 Merrill Lynch price target is above the $40.50 consensus target. Shares traded Thursday at $36.20.

Toronto-Dominion Bank

This is a top-yielding financial stock to add to portfolios. The Toronto-Dominion Bank (NYSE: TD) operates through Canadian Retail, U.S. Retail and Wholesale Banking segments. The Canadian Retail segment offers various financial products and services, as well as telephone, internet and mobile banking services to approximately 15 million personal and small business customers through a network of 1,165 branches and 2,867 automated banking machines in Canada.

The company’s TD Ameritrade business is incredibly fast-growing and¬†consistently challenges for online supremacy among the top Wall Street investment banks.

Investors receive a 3.38% dividend. Merrill Lynch has a $62 price target. The consensus price objective is $59.87, and shares were trading Thursday at $56.35.

Texas Instruments

This old-school chip tech company has come back into favor big-time. Texas Instruments Inc. (NASDAQ: TXN) is a broad-based supplier of semiconductor components, ranging from digital signal processors to high-performance analog components to digital light-processing technology and calculators. Some 65% of Texas Instruments sales are exposed to the well-diversified, business-to-business industrial, automotive, communications infrastructure and enterprise markets.

The company increased its quarterly dividend earlier this year by 32% to $0.50 per share, or $2.00 annualized. The increase reflects its continued strength in free cash flow generation and its commitment to return excess cash to shareholders.

Shareholders receive a 2.73% dividend. At $100, the Merrill Lynch price objective is well above the $88.66 consensus price target. Shares traded Thursday at $90.60.

The two stocks in the top fourth quarter ideas that are rated Underperform are Hewlett Packard Enterprises Co. (NYSE: HPE) and Nike Inc. (NASDAQ: NKE). These might be short sale ideas for more aggressive accounts.

Merrill Lynch has avoided high-flying momentum ideas and focused on solid companies with reasonably priced stocks that may benefit from White House initiatives and other macro events. They all make sense for long-term growth accounts.

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