Deutsche Bank's 'Fresh Money' portfolio beats the market. Here's what's in it

Published Thu, Jan 5 20231:06 PM ESTUpdated Thu, Jan 5 20231:14 PM EST

Deutsche Bank's top quarterly investment ideas have typically outperformed the market. The firm's "Fresh Money" list has returned 109% since its inception in the third quarter of 2017, outperforming the S & P 500 's 76% gain over the same period. And the rolling 12-month performance from the last four quarterly reports has showed its ability to pare losses in a down market, posting a loss of 11.4% compared with the S & P 500's 16.7% drop. Deutsche's Josh Ray released the first quarter list Wednesday. Here are 10 stocks that are on it: Deutsche Bank has the strongest earnings growth conviction this year in Charles Schwab , driven by the company's low deposit betas on cash. Earnings will be particularly closely watched this year because corporations are increasingly expected to see them slide as the economy contracts. The financial services company should see 20% per-share earnings growth in both 2023 and 2024, according to Deutsche Bank. Meanwhile, the firm's price target of $122 implies the stock should gain 46.4% in the next year. Penumbra should also perform well in 2023 on the back of three new health-care products, each of which the firm said has "game-changer potential." Deutsche's $250 price target implies the stock will gain 11.3% from Wednesday's close. The firm believes Chinese electric-vehicle maker Nio could emerge as a leader within the EV space. Deutsche Bank expects its ET5 mid-size sedan to become a top-selling model within six months as supply issues get worked out while demand remains strong. The firm also predicted Nio's deliveries to double in 2023 as the company stops making first-generation vehicles, focuses instead on its newer and cheaper second generation. Deutsche's $21 price target implies Nio could rally 97.6% from where it closed Wednesday. Monster Beverage has a "rare double-digit profit growth story" among consumer packaged goods companies and strong free cash flow, the report said. The company should see a margin recovery in 2023 as headwinds related inflation and supply chain ease, Deutsche Bank said. The firm's $114 price target presents an upside of 11.6% over where it closed Wednesday. Estee Lauder also made the list, as the firm said it will be helped by a recovery in makeup margins and rolled back Covid restrictions in China. Deutsche's price target of $266 implies the stock should gain a relatively modest 1.6% over the next 12 months.