Investors looking for somewhere to park their money in the new year may want to consider these top stock picks, according to Bank of America. The bank outlined 11 of its favorite names for 2023 in a note to clients Wednesday. Don’t be surprised if challenges linger in the new year as the Federal Reserve hikes rates, inflation persists and recession concerns mount. Some names, however, may be better positioned to ride out the volatility, according to the Wall Street firm. “Given our house view that 2023 could be a tale of two halves — a recession and a recovery — stocks may fare differently in these two periods, and we note recession and recovery beneficiaries below,” wrote Savita Subramanian, head of U.S. equity and quantitative strategy. As uncertainty lingers, here are some of the names Bank of America recommends: One under-the-radar pick is Analog Devices , a semiconductor stock that sold off about 7% in 2022. Bank of America views shares as a beneficiary of labor automation, trading at a 20% discount to the rest of the sector. The consensus price target on the stock also implies nearly 20% upside from Tuesday’s close. Another 2023 name to buy is health-care stock Humana , which outperformed in 2022 as investors flocked toward safe-haven sectors. Shares rallied more than 10% and analysts expect that to continue as a recession looms. The bank also recommends the stock as a play in the first quarter . Energy posted a record run in 2022 as oil prices gained, finishing in positive territory while other S & P 500 sectors faltered. One of those outperformers was Exxon Mobil . Shares surged 80% and Bank of America expects more upside ahead given its attractive dividend yield of 3.4%, strong cash flows and high beta. Shares of insurer Arch Capital Group rallied more than 41% last year, but Bank of America expects the stock will benefit from falling interest rate volatility in the new year. With a likely recession on the horizon, Walmart should also benefit from consumers trading down to less expensive products, according to Bank of America. Tractor Supply is another stock the investment bank is betting on in 2023. It touted the company’s strong balance sheet, domestic focus and potential for dividend growth, among other factors. — CNBC’s Michael Bloom contributed reporting
