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SUMMARY
Parkev Tatevosian, CFA and university professor, presents his updated list of the 15 best stocks to buy in May 2026, providing intrinsic value calculations and market context for each pick. He discusses portfolio performance, recent market rallies following geopolitical events, and the rationale behind each stock's inclusion.
MAIN POINTS
- Amazon and Meta Platforms are highlighted as undervalued stocks based on proprietary discounted cash flow valuations despite recent market volatility.
- Micron, Netflix, and Nvidia are discussed as strong buys due to sector trends in memory demand, prudent management decisions, and data center capital expenditures.
- Broadcom and Microsoft are noted for their roles in data center technology and AI, with Broadcom supporting proprietary chip development and Microsoft facing skepticism over capital expenditures and OpenAI involvement.
- Pinterest, Qualcomm, and The Trade Desk are identified as value opportunities, with optimism for earnings growth and resilience against competitive pressures from larger tech firms.
- Visa, Adobe, and McDonald's are considered bargains due to overblown market fears, with McDonald's poised to benefit from technology and delivery innovations.
- Lululemon is presented as a buy despite tariff headwinds, and the portfolio's performance is reviewed, showing significant recovery since the start of the year.
DETAILED ANALYSIS
Following a turbulent start to 2026, U.S. stock markets rebounded after a ceasefire in Iran, leading to a notable recovery in equity portfolios. The analyst presents a list of 15 top-ranked stocks, each evaluated using a proprietary discounted cash flow model to determine intrinsic value relative to current market prices. Amazon is identified as undervalued, trading at $268 versus an intrinsic value above $300, with strong performance in AWS and significant investments in artificial intelligence already yielding results.
Meta Platforms is also highlighted, with a fair value of $763 compared to a market price of $609, despite a temporary decline in users due to geopolitical events and increased capital expenditures.
Micron benefits from heightened memory demand, especially as companies like Meta face rising memory costs, and is expected to see its intrinsic value revised upward as new data emerges. Netflix is praised for its disciplined approach to acquisitions and is considered undervalued at $92 per share. Nvidia stands out due to its dominant position in data center GPU supply, with capital expenditures by hyperscalers exceeding initial forecasts, reinforcing its growth prospects.
Uber is viewed as a long-term opportunity, trading at a discount due to market fears over Tesla's autonomous vehicle ambitions, which the analyst believes are overstated.
Broadcom is recognized for enabling companies to diversify away from Nvidia by developing proprietary chips, capturing significant contracts and revenue growth. Microsoft, despite investor concerns over capital expenditures and its association with OpenAI, is seen as attractively priced relative to its intrinsic value. Pinterest, Qualcomm, and The Trade Desk are cited as value opportunities, with expectations of strong earnings and resilience against competitive threats.
Visa and Adobe are considered bargains amid regulatory and technological fears, while McDonald's is expected to benefit from technological innovation and expanded delivery networks. Lululemon, despite tariff-related headwinds and declining U.S. growth, is viewed as a bargain due to robust international performance. The analyst concludes with a review of portfolio performance, noting a significant improvement from -14% to -2.3% year-to-date, though still trailing the S&P 500, and expresses optimism for future outperformance.
LINKS
- YouTube channel membership for early access, spreadsheets, and Discord community.
- The Motley Fool special offer for stock recommendations.
- Parkev Tatevosian's book on a six-step investing framework.
- Fiscal.ai investment research platform with a discount for viewers.
- Substack newsletter subscription for monthly updates.