With the market beginning the year with a major sell-off, everybody remains on edge. Fortunately the numbers from China were at least in line, and the oil situation may start balancing out after Wednesday’s wash-out. One thing we have noticed here at 24/7 Wall St. is that many of the firms we cover already have made some tweaks to their top stocks lists for 2016. Hardly a surprise given the historic sell-off to start the year.

In a recent research note, Jefferies adds a very hot chip stock to its prestigious Franchise Picks list. We also screened for the other newest additions for investors to consider now. All these stocks are rated Buy.

NVIDIA

This top tech company reported outstanding earnings in November, and its stock now has been added to the Franchise Picks list. NVIDIA Corp. (NASDAQ: NVDA) is one of the leaders when it comes to supplying graphics processing technology for the 3D graphics market, including desktop graphics processors and gaming consoles. It is also moving into visual computing chips for cars, mobile devices and supercomputers.

NVIDIA has a technology partnership with electric car maker Tesla, and recently posted very strong earnings. The company has been able to use its ability to leverage past investments, with a more controlled spending structure ahead on unified, which enables strong cash flow that is allowing a focus on capital return. That is currently estimated to be $1 billion next year.

The company posted earnings that were way ahead of estimates, and the first-quarter outlook implies earnings per share 26% ahead of current consensus. With gaming revenues up 44% year over year, the analysts believe there remains high overall Wall Street skepticism around the company, as most are unaware of the positive dynamics in the PC gaming and e-sports markets.

Some Wall Street analysts feel that virtual reality could see 10 million in annual shipments in three to five years, and NVIDIA will be a huge player. In fact, it’s possible that those shipments could represent as much as $750 million per year for the company and competitor AMD. Jefferies also cites the large Technology Assessment Management Systems in gaming, autos and cloud enabled by NVIDIA’s graphics leadership.

NVIDIA investors receive a 1.7% dividend. The Jefferies price target for the stock is $38, and the Thomson/First Call consensus price target is $31.65. The stock closed Tuesday at $27.33.

Coach

This consumer discretionary stock is fighting its way back after getting annihilated last year. Coach Inc. (NYSE: COH) is a leading New York design house of modern luxury accessories and lifestyle brands. The Coach brand was established in New York City in 1941 and has a rich heritage of pairing exceptional leathers and materials with innovative design.

Coach products are sold worldwide through Coach stores, select department stores and specialty stores, and through company’s website. In 2015, Coach acquired Stuart Weitzman, a global leader in designer footwear, sold in more than 70 countries.

The stock was a favorite for years before getting absolutely hammered in 2015. Many Wall Street analysts have recently upgraded the company. Jefferies notes that many of the headwinds Coach faced last year should dissipate in 2016, and the holiday season seems to have been right on track.

Coach investors receive an outstanding 4.25% dividend. Jefferies has a whopping $50 price objective. The consensus target is $37.42. The shares closed Monday at $31.16.
Gulfport Energy

This company was added to the Franchise Picks list in December and is one of the favorites around Wall Street. Gulfport Energy Corp. (NASDAQ: GPOR) is an independent oil and natural gas exploration and production company with its principal producing properties located in the Utica Shale of Eastern Ohio and along the Louisiana Gulf Coast. In addition, Gulfport holds a sizable acreage position in the Alberta Oil Sands in Canada through its 24.9% interest in Grizzly Oil Sands.

Gulfport is a favorite of hedge fund managers. In fact, according to Insider Monkey, 36 hedge funds currently own positions in the stock. Jefferies notes that the shares have been weak on gas prices and a lower growth outlook, a move lower the firm believes is overdone. With a multiple in line with peers and an expected ramp-up in production next year, the stock may be a great value at current levels.

The $36 Jefferies price target is lower than the consensus target of $38.07. The stock closed most recently at $22.47.

WestRock

Last summer saw the merger of two top packaging and container companies — Rock-Tenn and MeadWestvaco — which could provide an outstanding opportunity for investors, as the stock has been absolutely mauled since the merger. WestRock Co. (NYSE: WRK) is now the second-largest U.S. packaging company, valued at $10.7 billion, trailing only International Paper with a market capitalization of just under $15 billion. WestRock is expected to generate net sales of $15.7 billion and adjusted EBITDA of $2.9 billion. This includes the impact of $300 million in estimated annual synergies, to be achieved over three years.

Jefferies notes that the company announced a stock repurchase program last year of 40 million shares, equal to 15% of the shares outstanding. WestRock also announced a very generous 17% increase in its dividend. The current dividend will be $1.50 per share, or $0.375 per quarter.

Late last year the company saw a flood of investment from some of the top hedge funds, with as many as 41 adding the stock to their portfolios.

WestRock investors will receive a very tempting 4.11% dividend. The Jefferies price target is $74. The consensus target is $70.56. Shares closed Tuesday at $36.46.

There you have it, some of the more recent additions to the Franchise Picks list. Given the current state of the markets, they all make good sense for growth investors looking for top companies that have been sold-off during the early January shakeout. All are outstanding stocks to add at current pricing points.

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