If you’re wondering what stocks to buy this month, look no further. After big gains in 2023, the stock market is off to a slower start this year. The S&P 500 is essentially unchanged and bounces around due to conflicting economic signals. Where 96% of traders had expected the Federal Reserve to cut interest rates at its next board meeting, that confidence is down to 61%. Some think even that is still way too hopeful.
Although Fed chairman Jay Powell signaled there would be three rate cuts in 2024, some regional Fed presidents were less optimistic. They are taking a wait-and-see approach before tipping their hand because consumer spending isn’t helping. December retail sales exceeded expectations for the holidays. While core inflation rates are lower, food and fuel are still up even if they are significantly below the highs hit in January 2023. Conversely, the labor market is slowing. It’s no wonder the benchmark index can’t make up its mind.
It’s why investors should ignore the noise of macroeconomic events when considering stocks to buy. Focus on the business and let the rest sort itself out. Quality companies can still rise above the turmoil, and the following three go-getters are poised to make big jumps in 2024.
Stocks to Buy: Apple (AAPL)
Don’t expect Apple (NASDAQ:AAPL) losing its appeal to import Apple Watches with blood oxygen sensors to hold back the tech giant. Apple initiated a workaround to allow it to continue importing the device so it will still be able to sell the Watches. It will disable the feature though already sold watches should still function. Apple generated almost $40 billion in revenue last year from wearables, and though the blood oxygen sensor was popular, it’s not critical to the watch’s success. Moreover, Apple has plenty of other levers for growth that will keep its stock moving higher.
The tech leader just surpassed Samsung as the world’s largest smartphone maker. It shipped 235 million iPhones compared to 227 million for its rival. It’s the first time in over a decade Apple is the world leader. The iPhone is still Apple’s bread and butter with $200 billion in sales in 2023 or 52% of total revenue. Services, though, is quickly gaining ground and accounts for 22% of revenue. It was the one area that saw growth last year.
BofA Securities just upped its price target on Apple to $225 per share, 20% above where AAPL stock currently trades. Strong iPhone sales and potential generative artificial intelligence (AI) features on its products will likely push sales even higher. Expect some major moves from Apple this year.
Rocket Lab USA (RKLB)
Satellite launch specialist Rocket Lab USA (NASDAQ:RKLB) should also launch its stock higher in 2024. As the second most successful space venture behind Elon Musk’s SpaceX, Rocket Lab recently grabbed a new Defense Dept. contract worth $515 million to put 18 space vehicles into orbit. Rocket Lab joins Lockheed Martin (NYSE:LMT) and Northrop Grumman (NYSE:NOC) as the third member of the U.S. Space Force’s Space Development Agency.
It suffered a brief setback in September with the failure of one of its rockets but ended the year on a high note with its 10th successful launch in 2023 and 42 launches overall. It has put over 170 satellites into orbit for its commercial and government customers. Rocket Lab currently uses its Electron rocket to put craft into space but it is developing a larger rocket, the Neutron, that should be ready by 2025.
Although its satellite launch business grabs the headlines, Rocket Labs’ bigger, faster-growing segment is its space systems division which manufactures components and spacecraft for customers. It represents 66% of the rocket stock’s total revenue. Sales are up 10% year-to-date. Much of that business is tied to systems for Globalstar (NYSE:GSAT), the satellite communications company. Rocket Lab will begin delivering the first of 17 spacecraft for Globalstar in Q1.
Even AI thinks Rocket Lab will be a massive hit over the next few years. Although RKLB stock is down 12% so far in 2024, it should take flight as the year progresses.
Alibaba (BABA)
Chinese e-commerce giant Alibaba (NYSE:BABA) was beaten down as China’s economy slowed, but that outlook is relative. China’s GDP grew 5.2% in Q4, which was slower than forecast but more than twice as fast as the U.S.’s expected growth rate. Other countries wouldn’t mind having 5% GDP growth.
U.S. export controls on technology and computers also setback Alibaba. The e-commerce stock is a conglomerate of businesses and had planned on splitting itself into six separate companies. The export controls put the separation of its cloud services on hold. Alibaba’s CEO Daniel Zhang stepped down from his position last June to take over the cloud company, but he quit that role as well two months later.
Alibaba also just lost its crown as the most valuable e-commerce stock in China to PDD (NASDAQ:PDD), the owner of rival Temu. Yet it still dominates the market. It has a near-51% share of e-commerce in the country, according to the International Trade Administration. That’s far ahead of second place JD.com (NASDAQ:JD) at 15%. Alibaba also accounts for almost half of all the world’s e-commerce transactions. The market is discounting its massive reach.
BABA stock is down 40% over the past 12 months. It trades at just 7 times earnings estimates and a fraction of its estimated long-term growth rate. China’s economy is still enjoying significant growth even if it’s less than what it was. And with Alibaba serving the second largest global economy, it’s just a matter of time before the market realizes the error of its ways and pushes its shares higher, making it one of the stocks to buy this month.
On the date of publication, Rich Duprey did not hold (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.