Morgan Stanley's Slimmon names 3 stocks to buy right now: ‘It's going to be a good year for equities'

Published Sun, Feb 18 20246:41 PM EST

Amala Balakrishner @in/amala-balakrishner @_amalabk

Equity markets have been having a pretty good year so far, with the S & P 500 benchmark closing above 5,000 for the first time last week. The rise in the index has raised some concerns over valuations, but Morgan Stanley's Andrew Slimmon has a more positive take on the recent market moves. "I think it is very encouraging because what it says is that earnings estimates for this year are not going down, and they're potentially, probably going higher. And that's important for the market," Slimmon, who's managing director and senior portfolio manager at Morgan Stanley Investment Management, told CNBC's "Squawk Box Asia" on Friday. "I think it's going to be a good year for equities. But it's going to come with more volatility, which will scare the people that have succumbed to putting money back in the market. But for people looking for opportunities, I think you will have pullbacks in what to invest," he said. He named Microsoft , Ameriprise Financial and CRH as stocks he likes right now. Microsoft In the tech sector, Slimmon named Microsoft as his choice to play the AI boom. The company — a member of the so-called "Magnificent Seven" along with Alphabet , Amazon , Apple , Meta , Nvidia and Tesla — has a story that is "very easy to understand," he said. Opportunities for the stock include Copilot, an AI-powered feature for Microsoft 365, according to Slimmon. The monthly add-on cost per person is around $30. "If you look at their numbers in terms of their expectations of usage, they're very vague right now, they don't they don't give exact numbers. So I think that presents some upside to the company," he added. Over the last 12 months, shares in the tech giant are up around 56.5%. Of the 51 analysts covering the stock, 49 give it a buy or overweight rating with an average price target of $469.94, according to FactSet data. This gives it around 16.3% potential upside. Ameriprise Slimmon named finance firm Ameriprise as one of the "selective financial stocks exposed to capital markets or wealth/asset management" that he likes. Over the last 12 months, shares of the company are up around 13.2%. Of the 15 analysts covering the stock, eight give it a buy or overweight rating, six have hold ratings and 1 has a sell rating. The average price target for Ameriprise is $418.03, according to FactSet data, giving it potential upside of around 5.1%. CRH The portfolio manager also said he "likes infrastructure plays," and identified Irish building materials group CRH as a stock with potential. The Dublin-headquartered company listed on the New York Stock Exchange in September 2023, following a de-listing of its shares on the Euronext Dublin. Its shares are also traded on the London Stock Exchange. Slimmon noted that CRH "re-listed in the U.S. because they felt largely their valuation was at a such a discount to their competitors" and that the company could be included on the S & P 500 at some point later this year. CRH's market capitalization currently stands at over $50 billion. Over the last 12 months, shares of CRH are up around 64.3%. Of the 22 analysts covering the stock, 18 give it a buy rating with an average price of $80.63, according to FactSet data. This gives it around 4% upside potential.