JPMorgan has unveiled its top picks for December, as traders try to wrap up a tumultuous year on a strong note. All three indexes rose in November. The Dow Jones Industrial Average led the way, finishing the month up 5.7%. The S & P 500 and Nasdaq Composite followed, adding 5.4% and 4.4%, respectively. Investors are typically bullish going into December given the potential for a “Santa Claus rally,” a period of strong market performance during the final days of the year and first days of the new year. Such a rally is uncertain this time, however, as Wall Street wraps up a tough year amid rising Federal Reserve rates due to higher inflation. Given this outlook, JPMorgan released its list of top stocks, which is update monthly. December’s list includes two new additions. Meanwhile, Honeywell was removed because it’s considered relatively expensive, which made the growth opportunity less attractive. The following chart includes 10 of the firm’s top picks. Brixmor Property Group , one of the additions, reported last month third-quarter operating earnings that matched a StreetAccount consensus analyst. Revenue, meanwhile, beat estimates. The company also increased its quarterly dividend by 8.3%. The commercial real estate company also hiked its full-year operating earnings guidance, a healthy indicator during a period when many companies are cutting outlook or pulling it altogether. JPMorgan’s price target of $26 per share implies an upside of 12.9% from Friday’s close. “The stock offers good value in the already discounted strip center sector, and we see its self-funded redevelopment program as driving NAV/FFO growth over time,” said Nicholas Rosato, JPMorgan’s head of North America equity research. FFO refers to funds from operations, while NAV references net asset value, which calculates a companies total assets with its liabilities subtracted. The other new addition was Guidewire , which was added ahead of its earnings report scheduled for Tuesday. Rosato noted that the insurance software company issued guidance at a recent analyst day that points to a loss reversal starting in the second half of 2023. This will lead to a re-rating of the stock in the market, he said. JPMorgan has a price target of $78 per share, implying upside of 28.4% from Friday’s close. “We like GWRE for its scale, focus on large Tier carriers, visible cloud market share gains and high liquidity of shares,” Rosato said. Dollar Tree , TransUnion and Mirati Therapeutics remained among JPMorgan’s top picks, along with Amazon, Public Storage, S & P Global and Allstate. — CNBC’s Michael Bloom contributed reporting.
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