These S&P 500 stocks crushed it in the first quarter. Here's where analysts see them going

Published Sun, Apr 2 20237:11 AM EDTUpdated Sun, Apr 2 20238:38 AM EDT

The S & P 500 just wrapped up a wild first quarter with surprisingly strong results. The broader market index gained 7% in the first three months of 2023, matching its fourth-quarter 2022 performance. The Dow Jones Industrial Average and Nasdaq Composite also gained 0.4% and 16.8%, respectively. .SPX YTD mountain Strong Q1 for S & P 500 Those gains come even as the Federal Reserve continues to raise rates, stoking concerns that a recession could arrive soon. On top of that, investors grappled with fears of systemic issues in the U.S. banking system last month following the collapse of Silicon Valley Bank and Signature Bank. To be sure, those worries seemed to ease toward the end of March. The tech and communication services sectors powered the S & P 500 higher, rising more than 20% each. On top of that, five of the 10 best-performing stocks for the quarter belonged to those two sectors. However, analysts think some of these top performers may be running out of steam. Here are the 10 best S & P 500 stocks for the first quarter, and where analysts see them going based on the implied upside (or downside) to their average price targets. Nvidia led the way higher among S & P 500 stocks, surging 90.1%. The stock got a boost as investors bet on the proliferation of artificial intelligence technology driving demand for the company's high-end semiconductors. "A key driver for NVDA is that the company already has a vast install base in which they can tap into to expand adoption of their AI solutions," wrote Piper Sandler analyst Harsh Kumar last week. "By starting with the current install base, this creates a customer feedback loop that should accelerate AI adoption." Kumar rates the stock as overweight and has a price target of $300 per share. That implies upside of 8%. However, Kumar is more bullish that most analysts on Nvidia. Going forward, analysts on average expect the stock to be flat over the next 12 months, FactSet data shows. Meta Platforms also had a strong quarter, rallying 76.1%. That marked the Facebook parent's second-best quarter on record. Meta's sharp gains were driven in part by the company's focus shift toward cost cutting. Earlier this year, CEO Mark Zuckerberg called 2023 " the year of efficiency ." To be sure, while nearly two-thirds of analysts rate the stock a buy, the average price target implies upside of just 4.7%, meaning Meta's strong run could be running out of steam. Other high-flying stocks in the first quarter that are expected to see more muted performances are Tesla, Align Technology, AMD, West Pharmaceutical Services and General Electric. Warner Bros Discovery and Catalent , however, are expected to build on their strong starts to 2023. The average price target on Warner Bros Discovery implies upside of 40.3% — after the stock rallied nearly 60% in the first quarter. Earlier this year, CEO David Zazlav said that, while the company is in a " very challenging " environment, he expects improvements in the second half of 2023. Deutsche Bank analyst Bryan Kraft said in a March 24 note that the company's moves aimed at improving free cash flow and deleveraging make the media company an attractive stock. "We believe that WBD offers an attractive risk/reward given its low valuation, industry leading general entertainment content portfolio, progress toward [direct-to-consumer] scale, [free cash flow] growth outlook, and clear path to deleveraging the balance sheet," he said. Kraft has a buy rating on the stock, but he's not the only analyst who likes it. FactSet data shows nearly 60% of analysts covering Warner Bros Discovery rate it a buy. As for Catalent, analysts see the stock rallying 24.5% after surging 46% in the first quarter. In February, Catalent announced an expanding manufacturing partnership with Moderna. As part of it, Catalent will provide support to Moderna's product manufacturing in North America and Europe. Catalent also issued full-year EBITDA guidance that surpassed StreetAccount expectations. To be sure, only 46% of analysts rate the stock a buy, per FactSet. CTLT YTD mountain Catalent in Q1 — CNBC's Michael Bloom contributed reporting.