Traders work on the floor at the New York Stock Exchange, November 4, 2019.
Brendan McDermid | Reuters
The Dow Jones Industrial Average has soared to record highs in 2019, climbing about 22% for the year. The following stocks are Wall Street analysts’ favorite picks to lead the benchmark in 2020.
CNBC identified these stocks by searching for searching in FactSet for companies in the index with a buy rating from at least 50% of analysts. The index featured 10 stocks with a majority rating of buy and at least 6% upside based on the average 12-month target price from analysts.
Simply put, these are the buy-recommended stocks that analysts think will rise the most in 2020.
The top pick reflects a welcome vote of confidence for a new chief executive officer. Chris Kempczinski took over McDonald’s in November, and analysts have not wavered in their support of the company. The fast food chain enjoys a buy rating from two-thirds of its analysts and has an expected upside of 14.4% in 2020.
Similar to the favorite stocks for 2020 in the S&P 500, an energy stock is near the top of the list. Chevron has risen roughly 10% in 2019, trailing the broader market as the oil industry has struggled.
The company in this screening with the most confidence from analysts was Visa, with 77% recommending a buy. The financial company has outpaced the index as a whole this year, rising more than 40%, but analysts still see upside for the stock.
Nike is another company that makes the list even after posting a strong 2019. The athletic apparel company has gained about 36% this year. Nike will also have a new CEO next year, as former eBay chief John Donahoe replaces Mark Parker.
Two pharmaceutical giants round out the list. Analysts are bullish on Merck and Johnson & Johnson even as the horse race in the Democratic Party’s presidential primaries has created uncertainty in the healthcare sector.