Some stocks are underperforming in 2024, but Lam, Adobe, and Merck show potential gains

From Nasdaq: 2024-10-04 10:27:00

The stock market has performed well in 2024, with the S&P 500 providing a total return of 20.6%, surpassing the 11.7% average over the past 30 years. However, not all stocks are thriving, with over 300 S&P 500 stocks underperforming. Companies related to AI and data centers are driving returns.

Lam Research (NASDAQ: LRCX) has lagged behind its industry, returning just 4% compared to the PHLX Semiconductor Index at 24%. Despite challenges, analysts expect higher revenue and earnings growth for Lam compared to its U.S. competitor, Applied Materials (NASDAQ: AMAT).

Adobe (NASDAQ: ADBE) has seen a total return of nearly -16% in 2024, despite beating analyst estimates for revenue and EPS. The company is investing in GenAI technology to maintain its leadership position. Wall Street analysts have a positive outlook, with the average price target suggesting a 22% upside.

Merck & Co (NYSE: MRK) has only returned 3% this year, below the median among large pharma firms. However, its net income growth and forward P/E ratio show potential. Wall Street sees the most upside in Merck stock compared to its peers, with an average price target implying a 26% increase.



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