Investing

5 Of UBS Highest Conviction 2025 Picks Are Also Dividend Superstars

Lee Jackson

Published: January 2, 2025 2:45 pm

As the calendar turns to 2025, the leading Wall Street firms are releasing their top stock picks for the new year. Typically, these are companies that analysts have incredible conviction in. In addition, they often have good upside to the assigned price target and are bestowed with either a Buy or Overweight rating, depending on the company providing the coverage.

24/7 Wall St. Key Points:

• After a sizzling 2023 and 2024, many feel stocks could slowdown in 2025
• The new administration will offer positive for the economy, like continued tax breaks for small business
• Dividend-paying growth stocks will make sense as interest rates continue lower in 2025
• Is your portfolio ready for 2025? Why not contact a financial advisor near you and set up a meeting? Click here to get started

Every year, the top Wall Street firms release a list of their top stock picks for the next 12 months. Typically, these are companies that analysts have an incredible conviction for. In addition, they often have good upside to the assigned price target and are bestowed with either a Buy or Overweight rating, depending on the company providing the coverage.

We screened the UBS Highest Conviction calls for 2025, and it looks like a stellar list of their 25 best ideas for the next 12 months. They said this in the report when discussing their process for stock selection.

UBS Research Management asked this question of all our analysts in North America. We’ve collected their responses and selected what we consider to be the 25 most compelling Buy-rated investment ideas for the year ahead. We’ve focused on stocks
where we believe our analysts have a differentiated view versus consensus and where we have interesting or proprietary data sources (from UBS Evidence Lab or elsewhere). We have also considered potential upsides to price targets, risk/reward skews, and a stock’s exposure to key themes and HOLT factors during the selection process.

We screened the list for the best total return candidate and found five that look like outstanding ideas for growth and income investors. At 24/7 Wall St., we consistently highlight the long-term potential of total return to our readers, as it is one of the most effective ways to boost the prospects of overall investing success. Once again, total return is the collective increase in a stock’s value plus dividends.

American Tower

This top company is in the perfect growth arena and pays a solid 3.56% recurring dividend. American Tower Corporation (NYSE: AMT) is a real estate investment trust (REIT) and an independent owner, operator, and developer of multitenant communications real estate. Its portfolio includes over 148,000 communications sites and a highly interconnected footprint of U.S. data center facilities.

Its segments include :

• U.S. & Canada property
• Asia-Pacific property,
• African property
• Europe property
• Latin American property
• Data Centers
• Services

The Company’s primary business is leasing space on multitenant communications sites to wireless service providers, radio and television broadcast companies, wireless data providers, government agencies, municipalities, and tenants in several other industries.

The company’s data center segment relates to data center facilities and related assets it owns and operates in the United States. The Services segment offers tower-related services in the United States, including AZP, structural and mount analyses, and construction management.

The UBS price target for the stock is posted at $245

CenterPoint Energy

This top utility is a fantastic idea with multiple business silos and a 2.76% dividend. CenterPoint Energy Inc. (NYSE: CNP) is an energy delivery company.

The Company, through its subsidiaries, owns and operates the electric transmission, distribution, and generation facilities and natural gas distribution facilities that serve customers in:

• Indiana
• Louisiana
• Minnesota
• Mississippi
• Ohio
• Texas.

The Company’s segments include Electric and Natural Gas.

The Electric segment comprises Houston Electric and Indiana Electric businesses.

The Natural Gas segment includes:

• Intrastate natural gas sales to and natural gas transportation and distribution for residential, commercial, industrial, and institutional customers in Indiana, Louisiana, Minnesota, Mississippi, Ohio, and Texas
• Permanent pipeline connections through interconnects with various interstate and intrastate pipeline companies and home appliance maintenance and repair services to customers in Minnesota
• Home repair protection plans to natural gas customers in Indiana, Mississippi, Ohio and Texas through a third-party

The UBS price target is set at $37.

ConocoPhillips

This large-cap integrated energy company offers investors substantial value and a solid 3.12% dividend. ConocoPhillips (NYSE: COP) explores for, produces, transports, and markets crude oil, bitumen, natural gas, liquefied natural gas, and natural gas liquids worldwide.

Conoco’s portfolio are:

• Resource-rich North American tight oil and oil sands assets
• Lower-risk legacy assets in North America, Europe, Asia, and Australia
• Various international developments and an inventory of conventional and unconventional exploration prospects

In November, the company completed its massive $22.5 billion purchase of Marathon Oil. Per the merger agreement, each share of Marathon Oil common stock was converted into the right to receive 0.255 shares of ConocoPhillips common stock at the adequate time of the merger, with cash instead of fractional shares.

Many Wall Street analysts, including the UBS team, feel Conoco can accelerate growth from a reloaded portfolio depth in the Bakken and Eagle Ford with visibility on future growth.

The UBS price target for the shares is $140

Enterprise Products Partners

This company is one of the largest publicly traded energy partnerships and pays a 6.60% dividend. Enterprise Products Partners L.P. (NYSE: EPD)  provides various midstream energy services, including:

• Gathering
• Processing
• Transporting and storing natural gas, natural gas liquids (NGL) fractionation
• Import and export terminalling
• Offshore production platform services

The company has four reportable business segments:

• Natural Gas Pipelines and Services
• NGL Pipelines and Services
• Petrochemical Services
• Crude Oil Pipelines and Services

One reason many analysts may like the stock is its distribution coverage ratio. The company’s coverage ratio is well above 1x, making it relatively less risky in the MLP sector.

UBS has set a $23 target price objective.

Texas Instruments

This legacy technology giant offers a 2.90% dividend and another solid way to play the AI explosion. Texas Instruments Incorporated (NASDAQ: TXN) designs, manufactures, and sells semiconductors to electronics designers and manufacturers in the United States and internationally.

The company operates through Analog and Embedded Processing segments.

The Analog segment offers power products to manage power requirements across various voltage levels, including battery-management solutions, DC/DC switching regulators, AC/DC and isolated controllers and converters, power switches, linear regulators, voltage references, and lighting products.

This segment provides signal chain products that sense, condition, and measure signals to allow information to be transferred or converted for further processing and control. These include amplifiers, data converters, interface products, motor drives, clocks, and logic and sensing products.

Texas Instruments also provides AI-focused chips and solutions. The company offers the Sitara AM62 processors that power AI applications.

The Embedded Processing segment offers microcontrollers for electronic equipment, digital signal processors for mathematical computations, and application processors for specific computing activities.

This segment provides products for use in various markets, such as:

• Industrial
• Automotive
• Personal electronics
• Communications equipment
• Enterprise systems
• Calculators

It also provides DLP products primarily for projecting high-definition images, calculators, and application-specific integrated circuits.

UBS has set a whopping $250 price target for the stock.