BTIG unveils top picks for rest of '23: D.R. Horton, CrowdStrike, DraftKings among names
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BTIG Research released its top picks report for the second half of 2023, providing high-conviction investment ideas and selected stock recommendations across various sectors.
These recommendations are based on a 12-month investment horizon and the current market landscape.
Here are BTIG's large-cap top picks by sector for the second half of 2023:
Consumer (XLP) (XLY)

D.R. Horton (NYSE:DHI) â Buy, PT $139 
Given the improving housing market, D.R. Horton (DHI), with dominant market positions, low-cost production advantage, broad geographic reach and strong financials is expected to gain market share, generate substantial cash flow and engage in accelerated share-repurchase activity, likely outperforming peers.


Deckers Outdoor (NYSE:DECK) â Buy, PT $613
Deckers Outdoor (DECK) remains a top pick and core holding due to its robust brand portfolio, consistent execution, margin improvements, solid balance sheet, potential upward earnings revision, expansion, growth opportunities for UGG and HOKA brands, revenue doubling for HOKA, strategic expansion, solid growth prospects for UGG, margin expansion potential and long-term focus on marketing and growth initiatives.
Dominoâs Pizza (NYSE:DPZ) â Buy, PT $400
BTIG believes Domino's (DPZ) has the most attractive return potential among large-cap restaurants due to factors like menu pricing, margin recovery, technology refresh, and bearish sentiment. Expected sales benefit from easier comparisons, higher pricing, driver availability, and the highest menu pricing in over a decade. This leads to continued margin improvement, franchise unit-level EBITDA recovery, accelerated unit growth, and a revamp of the digital ordering ecosystem. Domino's can regain its historical market-share leader position.

Financials (XLF)

Jack Henry & Associates (NASDAQ:JKHY) â Buy, PT $183
Jack Henry (JKHY) is among the top picks due to its consistent performance and potential to benefit from its core customer base's technology investments. With discounted trading levels and strong potential for returns in both rising and falling interest rate environments, the company is a strong choice for investors.

Healthcare (XLV)

Legend Biotech (NASDAQ:LEGN) â Buy, PT $90
Legend Biotech (LEGN) remains the top pick for large-cap stocks in the second half of 2023 due to its cell therapy franchise expansion, CARVYKTI success, positive clinical trial results, commercialization efforts, and potential label expansions. With a strong pipeline and global manufacturing capabilities, LEGN is a leading global cell therapy organization with potential for long-term blockbuster status.
Abbott Laboratories (NYSE:ABT) â Buy, PT $130
Abbott (ABT) is expected to outperform the stock market in the second half of the year due to its strong performance, new product launches, expansions, solid balance sheet, Dividend King status, and sustained growth in its Medical Device segment. The company's ability to adjust operational levers, achieve earnings guidance, engage in share buybacks, and pursue strategic M&A opportunities further enhances its investment appeal.
Stryker Corporation (NYSE:SYK) â Buy, PT $313
Stryker (SYK) is among top pick for the second half of 2023, replacing Intuitive Surgical (ISRG). With a favorable procedure environment, strong growth in Knee and Hip segments, and improved margins, SYK is poised for success. The company's strong product cadence, including new launches and robotic systems, solidifies its position as a compelling investment choice.

Real Estate (XLRE)

American Homes 4 Rent (NYSE:AMH) â Buy, PT $38
American Homes 4 Rent (AMH) is the second-largest REIT with a portfolio of 58,000 units in high-growth Sunbelt markets. With solid revenue prospects in the mid-single digits, potential reacceleration due to tight housing supply, and a defensible expense growth position, apart from property taxes. Additionally, AMH benefits from internal development pipeline and strong demand, driving robust same-store net operating income and FFO per share growth.
Prologis (NYSE:PLD) â Buy, PT $152
With a top-tier management team, strong balance sheet, and strategic capital business, Prologis is well-positioned to benefit from key trends, including the growth of e-commerce, supply chain reconfiguration, sustainability demands, and the rebounding investment sales market, offering opportunities for external growth.

Technology, Media, & Telecom (XLK) (XLC)

DraftKings (NASDAQ:DKNG) â Buy, PT $31
DraftKings (DKNG) is expected to benefit from favorable fundamentals in 2023, including product improvements, increasing parlay mix, a positive operating backdrop, and improved efficiency, which could drive significant upside in estimates and positive revisions. While both DraftKings (DKNG) and Flutter are viewed favorably, DraftKings is currently preferred due to its stronger performance potential, competitive narrowing, and the belief that Flutter's aggressive customer acquisition approach could present headwinds in 2023 but potential tailwinds in 2024.
Roblox (NYSE:RBLX) â Buy, PT $60
Roblox (RBLX) continues to be a compelling investment opportunity as BTIG analysts anticipate a favorable bookings growth and margin improvement cycle beginning in the second half of 2023. With the introduction of new products enhancing the user and developer experience, they foresee sustained top-line growth (projected at least 20% bookings growth over the next two years) and margin expansion from high single digits in 2023 to high teens in 2025. Estimates outpace consensus expectations, and upcoming catalysts like earnings reports, Developers Conference, and Investor Day events are expected to unlock further upside.
CrowdStrike Holdings (NASDAQ:CRWD) â Buy, PT $188
BTIG continues to maintain CrowdStrike Holdings (CRWD) as top large-cap pick for 2H 2023 due to its leadership position in the competitive endpoint security/EDR market, high win rates against rivals like Microsoft, strong customer recognition, and successful performance in emerging product categories. Despite concerns about the competitive environment and potential sales deceleration, analysts are confident that CRWD can meet or exceed Street estimates in FY24, driven by its established emerging product portfolio and successful entry into new markets.
Expedia Group (NASDAQ:EXPE) â Buy, PT $150
Expedia Group (EXPE) remains the top pick for 1H23 and 2H23 due to improved visibility on potential catalysts. Notably, EXPE is expected to converge its room night growth rates with Booking (NASDAQ:BKNG) in the 8%-10% range, benefit from marketing leverage in the second half, and has resumed buybacks, indicating the capacity to reduce leverage, increase cash, and achieve an earnings growth profile of 25%-30%.
MercadoLibre (NASDAQ:MELI) â Buy, PT $1600
MercadoLibre (MELI) has gained significant e-commerce market share in Brazil and exceeded profitability expectations in the first half of 2023. Despite a competitor's bankruptcy, MELI is expected to benefit from growth in lending, advertising revenue, and fulfillment service monetization, supporting EBITDA growth. Additionally, anticipated rate cuts by the Brazilian Central Bank in the next six months could boost consumer spending and enhance stock sentiment, offering attractive upside potential for MELI shares.
Tyler Technologies (NYSE:TYL) â Buy, PT $500
Tyler Technologies (TYL) remains the preferred large-cap pick due to its strong competitive position and positive outlook, including margin improvement and increased cloud SaaS adoption. The company's cross-selling opportunities, M&A focus, and One Tyler initiative contribute to double-digit organic topline growth and margin expansion, potentially leading to multiple expansion in the coming quarters.

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