These stocks have interesting setups going into 2022, Raymond James says

Published Fri, Dec 31 202112:04 PM ESTUpdated Fri, Dec 31 20211:55 PM EST

The past year has been about the drive toward "normalization," thanks to higher interest rates, lower price-to-earnings ratios and the impact of rising inflation on profit, according to Raymond James. That trend should continue in 2022, the firm said in a recent note in which it highlighted several stocks its analysts think have "interesting" setups for the next 12 months. Earnings should grow in the new year, though not as much as they did in 2021, managing director Tavis McCourt said in the note. He added that PE ratios should continue to come down as the Federal Reserve lifts rates to address inflation pressure. Given this setup, Raymond James highlighted several stocks it thinks could be compelling buys. Here are 10 of them: Each of the stocks mentioned has either an outperform or a strong buy rating. Among the large cap names are Wells Fargo , Okta and VMWare . Several Wall Street analysts have highlighted Wells Fargo as a stock with strong prospects, as it could benefit from the rate hikes. Raymond James also noted the bank's loan growth appears to be accelerating and fee-based revenue has been positive. Wells Fargo shares gained about 59% this year. Mohawk Industries , Scotts Miracle-Gro , APA Corp and Alaska Air are some of the mid-cap names on the list. Recent selling pressure has created a solid opportunity to buy high quality airline stocks like Alaska. "Longer term, [we favor] Alaska Air's low-cost/capital efficient DNA, relatively unimpaired balance sheet, and revenue upside from the new American partnership and Oneworld membership," McCourt said. Alaska has fallen slightly, by 0.1% this year. Among small caps, ZipRecruiter , health-care software company Phreesia and restaurant owner Bloomin' Brands are some of the highlights. Bloomin' has the potential to outperform "significantly" after reaching record-low valuations in the second half of 2021, according to the firm. That valuation compression was driven by concerns over inflation and the Covid omicron variant, as well as unexpected comp deceleration at Outback Steakhouse, Raymond James said. Bloomin' shares have gained 9% in 2021.

Customers arrive at an Outback Steakhouse restaurant on November 02, 2021 in Skokie, Illinois.

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That trend should continue in 2022, the firm said in a recent note in which it highlighted several stocks its analysts think have "interesting" setups for the next 12 months.