BofA Securities Makes Some Very Surprising Changes to US 1 List of Top Picks

Lam Research

This remains one of the top chip equipment picks across Wall Street, and it was up big on the bullish report. Lam Research Corp. (NASDAQ: LRCX) designs, manufactures, markets, refurbishes and services semiconductor processing equipment used in the fabrication of integrated circuits. The company offers plasma etch products that remove materials from the wafer to create the features and patterns of a device.

Many Wall Street analysts have highlighted the company and its peers as having a significant equipment opportunity from the NAND evolution as well. Lam Research also appears well positioned to gain share in the wafer fab equipment market, driven by a strong focus on technology inflection spending over the next few years.

Lam Research stockholders receive a 1.70% dividend. BofA Securities recently raised its price objective to $340. The posted consensus target price is $305.76. The final trade on Thursday was reportedly down almost 3% to $263.96.

UPS

Needless to say, with many at home due to current lockdown rules, the delivery business has been red hot. United Parcel Service Inc. (NYSE: UPS) provides logistics, freight (air, sea, ground, rail) forwarding, international trade management and customs brokerage.

The company has roughly 481,000 employees (390,000 in the United States) and serves more than 220 countries and territories. It operates a fleet of 237 UPS aircraft, as well as a ground fleet of more than 110,000 delivery vehicles. More than 46% of its volume is business-to-consumer, and it delivers more than 18 million packages per day globally.

UPS said earlier this year that it aims to more than double weekend deliveries in 2020 as package carriers look for ways to satisfy the always-on demands of e-commerce customers, including rising rival Amazon.com. UPS is vying also to attract more retailers that want to keep pace with Amazon shipping speeds, while holding on to its Amazon business, which accounts for almost 20% of company volume.

Shareholders receive a 4.04% dividend. BofA Securities has set a $109 price target, which is above the $107.78 consensus target. UPS stock was last seen trading at $99.45 a share.

One big-time stock removed from the vaunted US 1 list, one remains on the list, and three additional ideas that offer solid growth and dependable dividends. Given the huge market moves this year, it may be wise to buy partial positions and see if we don’t indeed see a test of the lows in March, or at least a sizable pullback.

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