By International stocks have outperformed their US counterparts in recent months – but a Jefferies analyst continues to favour the latter as they’re cheaper to own on an absolute basis.
Steven DeSanctis expects the US dollar to remain weak in the back half of 2025, which he believes will benefit a bunch of domestic mid-cap names.
The iShares MSCI All Country World Index ex U.S. ETF (ACWX) has gained over 14% in the year so far.
The S&P 500 index has been trailing behind with a 0.61% return.
These include Lamb Weston Holdings Inc. (NYSE: LW) and Stag Industrial Inc. (NYSE: STAG).
Why is Jefferies bullish on Lamb Weston stock?
Jefferies recommends owning Lamb Weston shares amidst an uncertain macro environment this year, primarily because the frozen potato products firm topped Street estimates in its latest reported quarter.
In April, the NYSE-listed firm reiterated its full-year guidance as well, which the investment firm dubbed “much needed to stem the negative sentiment” in its recent note to clients.
Steven DeSanctis remains constructive on LW stock also because it’s now working with a strategic advisor “to explore value creation and operational/cost saving opportunities.”
Additionally, the American food processing company pays a healthy dividend yield of 2.77%, which makes it all the more exciting to own for the months ahead.
DeSanctis has immense confidence in Lamb Weston’s ability to pass on higher costs and maintain margins. Other reasons cited for the bullish view include international expansion and continued investments in automation and supply chain.
Jefferies currently has a $75 price target on Lamb Weston stock that indicates potential for a more than 40% upside from current levels.
Note that other Wall Street experts agree with DeSanctis’ positive view on LW shares as well, given the consensus rating on the Idaho headquartered firm currently sits at “overweight”.
Why is Jefferies bullish on Stag Industrial stock?
Stag Industrial also posted a strong quarter and issued upbeat guidance for the future last month on the back of a more than 27% increase in cash-leasing spreads.
Jefferies remains constructive on the NYSE-listed firm as onshoring production and supply chain reconfiguration could retain the positive momentum in leasing spreads.
STAG’s focus on single-tenant industrial properties, especially warehouses and distribution centers, positions it well for long-term growth as businesses prioritise logistics efficiency.
The real estate investment trust (REIT) has a diversified portfolio that helps reduce risk, while its disciplined capital allocation supports steady returns.
Stag Industrial’s commitment to acquiring high-quality assets improves its ability to generate stable cash flow, making it an attractive choice for income-focused investors.
STAG is a dividend stock that currently yields 4.20%. Plus, Jefferies currently sees upside in the REIT to $45, which indicates potential for another 30% gain from current levels.
The post Jefferies names its favourite US mid-cap stocks for second half of 2025 appeared first on Invezz
