On Sunday, Oct. 4, JPMorgan Chase added five new names to its list of Overweight-rated favorite stocks. In the list, the bank groups its analysts’ top stock picks by investment style for different kinds of investors.
The new names JPMorgan added help clients diversify their investments beyond the crowded chip trade. The bank highlighted three names in particular out of the new picks, and they fell under the Value and Growth categories.
American Express (AXP) was added as the main Value pick. Thermo Fisher Scientific (TMO) and Liberty Energy (LBRT) were the primary Growth picks, with the bank linking Liberty to the rising power needs of AI data centers.
American Express as the Value pick
American Express (AXP) is a credit card company that makes its money from annual card fees and interest. It also earns money by charging a fee every time a shopper makes a purchase with an AmEx card.
The stock has dropped about 18% to 19% so far this year because investors worry about rising consumer debt and people becoming more prudent with spending due to economic pressures.
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However, JPMorgan analyst Richard Shane thinks investors shouldn’t be too worried. He said, “AXP remains a core holding for investors looking for industry leading high returns and disciplined return of capital.”
Shane also points out that American Express produces steady profits and has a habit of buying back about 3% of its own shares every year, CNBC reported. It also delivers a regular dividend.
When a company buys back its own shares, it reduces the number of shares available in the market, which in turn increases shareholders’ earnings per share. Buybacks alongside its dividend give AmEx two ways to return cash to shareholders while they wait for the stock to recover.
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Thermo Fisher as the biotech Growth pick
Thermo Fisher (TMO) sells lab equipment, testing tools, and manufacturing services to drug makers and research labs. When a drug company needs to make a new vaccine or build a test for a disease, Thermo Fisher often supplies the equipment and chemicals that it needs.
TMO is up more than 25% in the past three months, and JPMorgan analyst Casey Woodring expects the stock to keep climbing.
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He cites a new partnership deal Thermo Fisher has with the Mayo Clinic focused on catching diseases earlier, and government efforts to bring drug manufacturing back to the US.
Woodring also likes that Thermo Fisher is a growing player in AI-powered lab machines. UBS had a similar view earlier in September, upgrading Thermo Fisher to a Buy rating with a $730 price target.
Liberty Energy as the AI power Growth pick
Liberty Energy (LBRT) helps oil and gas producers drill wells. It has also built a second business selling small power systems that can generate electricity on-site when the main power grid is having capacity issues.
That second business is why JPMorgan is bullish on LBRT. Analyst Arun Jayaram wrote that the market setup supports a “multi-year demand runway” thanks to rising electricity demand from AI data centers.
He also said he expects power shortages to extend into 2030. He calls Liberty a “behind-the-meter” provider because its machines run at the customer’s site and skip the public grid entirely.
Liberty shares are already up about 52% over the past 12 months, and the reason is quite simple. Big tech firms keep building more AI data centers, and they need a steady supply of electricity to run them. That makes Liberty’s power systems more valuable right now.
What everyday investors should think about before buying
Investors should treat JPMorgan’s Overweight list as research material. Each stock it names still has its own risks.
AmEx could keep falling if consumer credit gets worse. Thermo Fisher’s gains depend on biotech customers maintaining their spending rate and the Mayo Clinic deal turning into actual sales. And Liberty Energy’s rise is tied to the AI data center boom, which could slow if big tech buyers decide to cut spending.
As I’ve written in previous articles for TheStreet, the smart move with a list like this is to treat it as a starting point for your own research. Compare each name to what you already own, consider how much a single stock would affect your portfolio, and read each company’s latest earnings report before buying.
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