Bank of America's Favorite Stock Ideas For 2019

On the first day of Christmas, Bank of America Merrill Lynch says to you: Look at Disney, GM and Molson Coors Brew.

The firm's analysts recently made their recommendations for 11 stocks worth a look in 2019, with one from each of the 11 standard industry sectors.

BofA's full list is below, along with some of the research firm's rationale for the picks.

1. Communications: Walt Disney Co DIS

Analysts view Disney as one of the highest-quality S&P 500 stocks, with strong free cash flow. It's underweighted by large-cap active funds.

2. Consumer Discretionary: General Motors Company GM

Analysts like GM's strong free cash flow, and it's another stock that’s underweighted by large-cap active funds. Catalysts in the pipeline include its position on autonomous driving and the potential for resolution of the trade war.

3. Consumer Staples: Molson Coors Brewing Co. TAP

Analysts see an above-market dividend yield stock that historically does well in periods of rising volatility. It's underweighted by large-cap active funds.

4. Energy: Exxon Mobil Corporation XOM

Exxon is a “more defensive energy stock [with] low sensitivity to oil," according to BofA. Analysts also like that it is high-quality, inexpensive, has a healthy FCF yield and an attractive/growing dividend.

5. Financials: Morgan Stanley MS

Analysts see this high-quality financial stock as a “potential beneficiary of less onerous regulatory backdrop.”

6. Health Care: CVS Health Corp CVS

BofA sees "high quality, low leverage, inexpensive [and an] above-market dividend yield" as qualities to like in CVS. The pharmacy chain has potential synergies in the Aetna acquisition, and the stock historically does well in times of rising volatility, analysts said.

7. Industrials: Raytheon Company RTN

Defense stocks should benefit from a larger defense budget, and the equity is a hedge against geopolitical risks, according to BofA.

8. IT: Microsoft Corporation MSFT

Microsoft has a healthy balance sheet and is investing in future growth, analysts said.

9. Materials: International Paper Co IP

Analysts see an inexpensive, high-quality stock with an attractive dividend yield that's underweighted by large-cap active funds.

10. Real Estate: Simon Property Group Inc SPG

Analysts like this company's growing dividend yield, strong earnings per share and cite a “high quality portfolio based on … analysis of mall REIT portfolios.”

11. Utilities: Public Service Enterprise Group Inc PEG

Analysts are impressed by an attractive and growing dividend yield. “[The equity] historically fares well in rising volatility environments," and it's underweighted by large-cap active funds.

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