Morgan Stanley updated its portfolio of top stock picks that trounced the market in the last year

Published Fri, Sep 8 20231:54 PM EDTUpdated Fri, Sep 8 20234:03 PM EDT

Morgan Stanley added some of the biggest tech names on Wall Street to its list of top stock picks to hold for the next year. The firm's "Vintage Values" list combines stock-picking fundamentals with quantitative analysis, according to analyst Michelle Weaver. In the past year alone, the list returned 19.49%, beating the S & P 500 by 9.41 percentage points. "The list has a bias toward high-quality stocks, yet it screens as less expensive than the market on almost all multiples-based metrics, especially key cash-flow-based valuation measure," Weaver said. For the latest iteration, Morgan Stanley pivoted heavily toward some of the most prominent tech gainers this year, including Nvidia and Microsoft . On Microsoft , the firm maintains an overweight rating with a $415 price target, which implies about 26% upside from Thursday's close. Weaver said the company is well-positioned to continue capitalizing on growing artificial intelligence as well as cloud services adoption. Microsoft shares have jumped more than 39% year to date. MSFT YTD mountain Microsoft year to date Chipmaker Nvidia also made the list. The stock is the best performer in the S & P 500 this year, soaring more than 217%. Enthusiasm around AI and expectations for high demand for Nvidia's semiconductors have driven the stock higher in that time. Morgan Stanley rates Nvidia as overweight with a $630 per share price target, which equates to roughly 36% upside from Thursday's close. The analyst said the company will continuing growing due to a strong data center segment. NVDA YTD mountain Nvidia in 2023 The bank also added Google parent company Alphabet to the latest edition of the list. Morgan Stanley rates the stock as overweight with a $155 per share price target. That outlook points to a gain of approximately 15%. Weaver said Alphabet will continue to expand its integration of AI platform functions into its Google search and YouTube segments, while "other offerings [will] improve confidence in the durability of long term growth." GOOGL YTD mountain Alphabet stock this year E-commerce behemoth Amazon is a holdover from the previous Morgan Stanley list, and Weaver similarly highlighted the company's growth of its cloud services and Prime membership. The firm has an overweight rating on Amazon with a $175 per share price target, about 27% above the previous close. — CNBC's Michael Bloom contributed to this report.