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U.S. Insights – Research Rundown: The Latest Franchise Picks and Focus Stocks

— Jefferies U.S. Equity Research

Jefferies published the third installment of the “Research Rundown” report, revisiting the Jefferies Franchise Picks List, which has outperformed the S&P 500 by 1674bps since its inception in December 2013. Franchise Picks include stocks with differentiated analysis, where risk reward skews compelling, and analyst conviction is high. Jefferies also refreshed the firm’s Focus List, consisting of 90 institutionally relevant stocks in which Jefferies analysts have observed elevated interest. Franchise Picks are also on the Focus List, which includes many top picks for the respective analysts. Since publishing the report, Jefferies downgraded NWL to Hold and removed the stock from the Franchise Pick list, as the thesis that synergies would drive upside has played out. Jefferies also recently added GPS to the list with a sum-of-the-parts analysis suggesting 50%+ upside from current levels, and Jefferies believes the Old Navy brand is worth significantly more than currently implied by GPS’ enterprise value. Stocks currently on the Franchise Picks list are: ABBV, ATVI, ALLY, GOOGL, BLL, BA, CVX, DISH, DLPH, DXC, FLT, GPS, HAIN, IR, KEY, MPC, MUSA, NVDA, OC, PX, PYPL, SRCL, TXT and UAA. FULL REPORT