Nvidia, Meta, Lululemon: Freedom releases sector picks for 2026

Freedom has released its top U.S. stock picks for 2026, making sweeping changes to last year’s lineup. Most prior picks have been dropped, while a new group of stocks has emerged as macroeconomic conditions, corporate earnings trajectories, and sector dynamics have shifted.

Nvidia is Freedom’s top choice in the IT sector. The chipmaker stands out as one of the primary beneficiaries of the global investment cycle in AI infrastructure. High gross margins, combined with long-term supply agreements with hyperscalers, underpin expectations for sustained revenue growth, according to Freedom’s 2026 strategy report (seen by Oninvest). Analysts place Nvidia’s target price at $250 per share, implying upside of 40% versus the December 19 close (all estimates below are based on data as of December 19).

Meta Platforms is Freedom’s preferred name in communications. Advertising continues to generate the bulk of revenue, while the company is expanding into new growth areas, including generative AI and augmented reality. Analysts also highlight Meta’s work on proprietary chips developed in partnership with Broadcom for data centers, a move expected to improve computing efficiency and reduce reliance on third-party suppliers. Freedom has set a target price of $800 per share for Meta, pointing to roughly 20% upside next year.

Illumina is Freedom’s top pick in health care. After a steep selloff and a change in the management, analysts believe the market may begin to rerate the stock as revenue growth resumes in 2026. For now, Freedom’s target price of $125 per share broadly aligns with current trading levels.

BlackRock, Freedom’s preferred financial stock, remains the world’s largest asset manager and the dominant ETF provider through iShares. Assets under management have climbed to a record $13.5 trillion, up 17% last year. Analysts point to the Aladdin tech platform as a core competitive advantage, enhancing scalability and creating durable barriers to entry. Combined with iShares’ market leadership and the expansion into alternative investments, these factors support long-term revenue and earnings growth. Freedom assigns BlackRock a target price of $1,255 per share, about 15% above the current price.

Stellantis is Freedom’s automotive pick. The group operates one of the largest auto portfolios in North America and Europe, spanning brands such as Jeep, Fiat, Peugeot, Dodge, Opel, and Chrysler. With a substantial share of revenue generated in North America, results remain sensitive to regional demand trends. Freedom expects the launch of up to 10 new models in 2025 and sees revenue growth resuming in the second half of the year. Improving operating performance and a return to positive net income could support a favorable market reaction. The target price for Stellantis is $12.30 per share, around 5% above current levels.

Johnson Controls is Freedom's industrial pick, seen as benefitting from rising investment in data centers and AI-related infrastructure. The company’s focus on building management systems, climate control, and automation aligns with growing demand for energy-efficient and smart-building solutions, particularly among corporate clients and data center operators. Analysts also point to margin improvement initiatives and an ongoing share buyback program as supportive for earnings per share. Freedom assigns a target price of $132 per share, implying upside of 12%.

Millrose Properties is Freedom’s real estate pick. The $4.9 billion fund specializes in financing and owning land assets tied to residential development. Analysts cite a high dividend yield and a valuation discount versus comparable real estate vehicles. Combined with resilient housing demand in several U.S. regions, these factors create scope for a rerating. Freedom’s target price is $40 per share, 35% above current levels.

ONEOK represents Freedom’s choice in the energy sector. Higher winter gas prices and an elevated dividend yield support the investment case, even as Freedom maintains a negative tactical view on the sector. Lower interest expenses following balance sheet optimization provide an additional tailwind. The target price of $82 per share implies upside of about 15% over the next year.

Unitil Corporation, a regional utility with a market capitalization of roughly $900 million and Freedom's utilities pick, provides electricity and natural gas distribution services in the northeastern U.S. Regulated tariffs and a stable customer base underpin predictable revenue. Analysts note that Unitil continues to expand through acquisitions, integrating new assets into its existing network. Moderate leverage and steady dividend growth enhance the stock’s appeal. Freedom’s target price of $55 per share represents 10% upside.

Target is Freedom’s essential-goods retail pick. The retailer has faced pressure in recent quarters as consumer activity softened and costs rose, leading to a sharp decline in the share price. Analysts argue the market has priced in an overly pessimistic scenario. Potential recovery catalysts include growth in digital sales, expansion of delivery and pickup services, improved inventory discipline, and cost optimization. Freedom’s target price of $145 per share implies nearly 50% upside.

MP Materials, which Freedom prefers in the raw materials sector, benefits from U.S. efforts to reduce reliance on Chinese rare earth supply chains. Analysts point to the company’s vertically integrated model and expansion of magnet processing capacity as factors strengthening cost control. Freedom’s target price of $75 per share implies upside of roughly 45%.

Tencent Holdings is Freedom’s preferred China exposure. The tech group operates diversified businesses across gaming, social platforms, digital advertising, and cloud services, with WeChat and QQ forming core infrastructure for China’s digital economy. Expected stimulus boosting domestic demand, along with rising business adoption of AI, supports the outlook. Analysts highlight consistently high margins and strengthening positions in cloud and digital marketing. Freedom sets a target price of $95 per Tencent American depositary receipt, implying upside of more than 20%.

First Solar remains on Freedom’s list as its pick in renewable energy, supported by a stable order backlog and expanding U.S. production capacity. The updated strategy report raises the target price to $310 per share, implying nearly 20% upside. Last year’s target of $240 per share has already been exceeded.

Lululemon Athletica also retains its place for nonessential retail. Despite nearly two years of share price declines, the company continues to generate strong operating profits and has a resilient business model. Analysts see recovery potential in international expansion, particularly outside North America, alongside further growth in online sales and product diversification. The target price of $280 per share implies upside of 30%.

Among Freedom's 2025 picks, made at the end of 2024, were Alphabet, Micron Technology, Ford Motor, BP, Nike, and Wells Fargo (for more, see here).

In its base-case scenario, Freedom expects U.S. equities to post gains in 2026 as inflation continues to slow and monetary policy eases. The firm has cut its forecast for core PCE inflation to 2.7% year over year, citing persistent disinflation in services and a more limited impact from tariffs than previously expected.

The base case assumes two Fed rate cuts in 2026, which would be supportive for risk assets.

Freedom targets 7,700 points for the S&P 500 at end-2026 in its base case, with a 2026 average forecast of about 7,500 points. That represents upside of 14% and 11%, respectively, versus current levels.

Key risks include potential volatility in labor market expectations, uncertainty over the Fed’s policy path, and political risks around the legality of tariffs. Even so, Freedom argues that underlying fundamentals continue to support a constructive market trend, provided macroeconomic stability persists.