Bank of America’s (NYSE: BAC | BAC Price Prediction) Chief Investment Strategist Michael Hartnett adopted a cautious yet opportunistic stance in his latest Flow Show, warning that investors are approaching a pivotal juncture. He highlighted rising bond yields, elevated technology valuations, and evolving global capital flows as forces likely to trigger a rotation in market leadership. Despite the AI-fueled surge that has lifted major U.S. indexes to record highs, Hartnett sees attractive opportunities shifting toward previously neglected segments—including international equities, bonds, financials, and other value-oriented areas. At the core of his outlook: the trajectory of long-term Treasury yields will be the decisive variable. Their direction, he argues, will ultimately determine whether the current bull market broadens sustainably or risks a sharp correction. The bottom line: if yields on the 30-year bond move and stay above 5%, the economy could be in trouble.
We have covered Hartnett’s work for years here at 24/7 Wall St., and while he is by no means a perma-bear, his recent Flow-Show commentary for investors warned that many of the current valuations and metrics increasingly resemble the dot-com bubble era of 2000 to 2001. Hartnett continues to caution that many AI, semiconductor, and large-cap technology stocks are significantly overbought after their explosive rally. Instead, he sees more compelling opportunities in lagging sectors, particularly healthcare, defense, Treasury bonds, and select international markets.
Hartnett’s signature theme of being “long Detroit, short Davos” remains firmly in place. This means he continues to favor U.S. small- and mid-cap stocks, banks, real estate investment trusts (REITs), industrials, and other beneficiaries of the domestic economy, while steering clear of the Magnificent Seven and other richly valued global growth names. He expects rising political pressure ahead of the 2026 midterm elections to increasingly support policies focused on affordability, domestic investment, and lower interest rates.
One very disturbing statistic Hartnett pointed to was that recently, 21 stocks, which are roughly 4% of the S&P 500, accounted for all the new all-time highs while the headline index rose. This is an almost identical concentration pattern to the peak of the dot-com bubble in March 2000. He also noted that 331 S&P 500 stocks are trading at least 20% below their all-time highs, indicating that market breadth remains severely distorted.
We decided to screen our 24/7 Wall St. research database for dividend-paying companies in sectors Hartnett is positive on and that are rated Buy at Bank of America. We found five ideas that may interest investors concerned about the current state of the stock market and the economy.
Acadia Realty Trust
This is a perfect idea for conservative growth and income investors, paying a dependable 3.63% dividend. Acadia Realty Trust (NYSE: AKR) is an equity REIT. The company is focused on the ownership, acquisition, development, and management of retail properties located primarily in high-barrier-to-entry, supply-constrained, densely populated metropolitan areas in the United States.
The company operates through three segments:
- Core Portfolio, which consists primarily of retail properties located primarily in high-barrier-to-entry, densely populated metropolitan areas with a long-term investment horizon.
- Investment Management holds primarily retail real estate in which the Company co-invests with high-net-worth institutional investors.
- Structured Financing consists of earnings and expenses related to notes and mortgages receivable.
The company has ownership interests in approximately 210 properties within its core portfolio and investment management.
Bank of America has a $24 target price.
American Healthcare REIT
American Healthcare REIT (NYSE: AHR) is a self-managed REIT and is one of the bank’s top picks, as it resides on the US 1 list. With an aging global population, this company is in the right real estate silo and pays a 2.05% dividend to shareholders. It acquires, owns, and operates a diversified portfolio of clinical healthcare real estate properties, focusing primarily on senior housing, skilled nursing facilities, outpatient medical buildings, and other healthcare-related facilities in the United States, the United Kingdom, and the Isle of Man.
Its segments include:
- Integrated senior health campuses
- OM, SHOP, and triple-net leased properties
Its OM buildings are leased to multiple tenants under separate leases. Its integrated senior health campuses each provide a range of independent living, assisted living, memory care, skilled nursing services, and ancillary businesses.
Its triple-net leased properties include:
- Senior housing
- Skilled nursing facilities
- Hospital investments
SHOP includes senior housing, which may provide:
- Assisted living care
- Independent living
- Memory care
- Skilled nursing services
The BofA Securities target price for the shares is $36.
Edison International
Trading in the middle of its 52-week range with one of the highest dividends in the utility sector at 4.88%, this is a strong idea for the rest of 2026. Edison International (NYSE: EIX) is an electric utility holding company focused on providing clean and reliable energy and energy services through its independent companies.
Edison is the parent holding company of Southern California Edison Company (SCE) and Trio. SCE is a public utility primarily engaged in the business of supplying and delivering electricity to an approximately 50,000 square mile area across Southern, Central, and Coastal California. Meanwhile, Trio is a global energy advisory firm providing integrated sustainability and energy advisory services to large commercial, industrial, and institutional organizations in North America and Europe. It provides integrated strategy and implementation solutions in:
- Sustainability
- Renewables
- Energy procurement
- Conventional supply
- Energy optimization
- Transportation electrification
Bank of America has a $78 target price.
Getty Realty
With a whopping 5.87% dividend, this is one of the top small-cap picks at Bank of America. Getty Realty (NYSE: GTY) is a net lease REIT specializing in the acquisition, financing, and development of convenience, automotive, and other single-tenant retail real estate.
The company’s portfolio includes approximately 1,137 freestanding properties located in 44 states across the United States and the District of Columbia. The portfolio is comprised of:
- Convenience stores
- Express tunnel car washes
- Automotive service centers (gasoline and repair, oil and maintenance, tire and battery, and collision)
- Freestanding retail properties, including drive-thru quick service restaurants and automotive parts retailers.
The company’s tenants operate under a variety of national and regional brands. They either operate their businesses at its properties directly or, in the case of certain convenience stores and gasoline and repair stations, sublet its properties and supply fuel to third parties who operate the businesses.
Bank of America has a $37 price objective.
KeyCorp
This regional bank offers a sizable 3.84% dividend and outstanding growth prospects. KeyCorp (NYSE: KEY) is a bank-based financial services company that operates through its subsidiary, KeyBank National Association (KeyBank).
Through KeyBank and certain other subsidiaries, it provides a range of:
- Retail and commercial banking
- Commercial leasing
- Investment management
- Consumer finance
- Student loan refinancing
- Commercial mortgage servicing and special servicing
- Investment banking products and services to individual, corporate, and institutional clients
Its Consumer Bank segment serves individuals and small businesses by offering a variety of deposit and investment products, personal finance and financial wellness services, lending, student loan refinancing, mortgage and home equity services, credit card services, treasury services, and more.
The Commercial Bank segment consists of the Commercial and Institutional operating businesses. The former focuses on serving clients’ borrowing, cash management, and capital markets needs.
Bank of America’s price target is $25.
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