These 2 stocks have just been added to JPMorgan’s focus list

whenever JP Morgan (NYSE:JPM) adds new stocks to its focus list, investors looking for value or growth at a reasonable price (GARP) should be all ears. Depending on where you look, equity valuations may still be a little high, even after the rough late summer that the markets went through. However, despite the less-than-ideal terrain, the stock market is a stock market. And some of the more overlooked names out there (think outside of the Magnificent Seven cohort) seem like much better deals today.

In this paper, we’ll go over two of the latest additions to JP Morgan’s exclusive list and determine whether now is a good time to buy amid a turbulent market that could risk delivering more of the year’s gains, even if the Fed follows through on promised interest rate cuts.

Key points about this article

• JP Morgan’s focused list is worth checking out if you’re looking for opportunities in the current market.
• Adobe and Caesars Entertainment are two notable additions that could be poised to grow.
• If you’re looking for action with huge potential, be sure to grab our free copy brand new “Next NVIDIA” report.. It has a software stock where we are sure it has 10x potential.

Adobe

Tech doesn’t seem to be the place to be right now, with the tech-heavy Nasdaq 100 trailing the S&P 500 since the first half of 2024 began. No doubt the creative software company has received negative headlines about consumer-unfriendly practices around its software subscription services. Indeed, the FTC suit acted as a surplus Adobe (NADSAQ:ADBE) has been around for a while.

However, there are few suitable alternatives for many professional graphic designers on the market right now. Indeed, the price to use Adobe’s creative suite may be high, but until there is a credible challenger to Adobe’s throne, people will have no choice but to pay with their money and perhaps their data, which many users fear.

For now, the company has publicly stated that it will not train its generative AI models with user data. Given that certain clauses in the terms and conditions seem vague, some users may not buy them.

However, Adobe users will have few alternatives until another firm can crush its moat with a better offering. Even then, navigating a completely different platform can prove difficult, especially for those trained in Adobe software since entering the industry.

Some big names on Wall Street believe Adobe is on the right side of the AI ​​boom.

JP Morgan analyst Mark Murphy is bullish on the firm after its solid quarter released in June. In particular, Murphy believes AI tools and applications, including the Firefly imager, can help propel the stock through the end of the year.

Murphy isn’t the only big bull on Adobe Firefly AI. Hedgeye analyst Felix Wang is “confident” in Adobe’s AI strategy and believes the Firefly integration is “underappreciated” by the market. At a price-to-earnings (P/E) ratio of 27.7 times, ADBE stock looks relatively cheap compared to most other AI technology firms.

Caesars Entertainment

Caesars Entertainment (NYSE:CZR) is a gaming company that also made JP Morgan’s interest list. The company has been stuck in a bear market for some time, and despite subtle recession worries (downturns aren’t dire for casino firms), the low valuation may be reason enough to ride the wave.

Notably, JP Morgan analyst Joseph Greff sees Caesar’s estimates as “achievable.” Whenever there is a low bar and an even lower rating, you can have a deep value play where most others are sleeping. At the time of writing, CZR stock is down nearly 70% from its all-time high to just $120 per share. Greff is not the only bull named at this level.

Billionaire investor Carl Icahn added to his stake in the struggling casino stock, picking up another 2.44 million shares. Indeed, investors are in pretty good company with Caesars as the firm looks to weather a tough economic period. At 1.8 times price to book (P/B) and 0.7 times price to sales (P/S), Caesars stock is historically depressed.

While only time will tell how much recession risk is embedded, the longer-term chart suggests that economic weakness has been on the radar for several years. If you strongly believe that the economy is headed for a soft landing (former Fed Chair and current US Treasury Secretary Janet Yellen does), CZR stock could turn out to be a massive steal.

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