Investors should keep an eye out for casino and real estate stocks next year, according to Gerber Kawasaki Wealth & Investment Management CEO Ross Gerber.
MGM (MGM), Lennar (LEN), and Tesla (TSLA) were selected as the top three stocks poised to rise in 2022 in Gerber’s preview. He joined Yahoo Finance Live on Thursday to discuss which stocks should perform best next year.
“MGM is a long-term holding of ours and we’ve been adding to it on the weakness because of Omicron,” Gerber said. “And we absolutely believe this is the endgame for Corona, this winter being sort of one of the tougher winters again. But as each winter rolls on, this will become much more normal and much less disruptive.”
MGM Resorts International, a giant in the hospitality and entertainment industry, specializes in casinos, hotels, and resorts. As the global outlook continues to improve and the economy adjusts to the new realities concerning COVID, Gerber noted, the hospitality sector could stand to benefit greatly.
The prospect of interest rate hikes in 2022 looms over the economic picture for next year and has dampened some analysts’ expectations for stock market growth. “The probability of a 10% correction in the near term or over the next 12 months is elevated,” Bank of America’s (BAC) U.S. stock and quantitative strategy chief Savita Subramanian told Bloomberg earlier this month.
Gerber, who expressed doubt that all three Fed rate hikes would come in 2022, had a more optimistic disposition.
“We actually don’t think the Fed will actually hit their three rate hikes next year, we’ll see,” he said. “But if it does happen, it won’t be till the end of the year, and so housing is a supply and demand imbalance on a massive scale. And home builders like Lennar, especially Lennar, which is a really large, established home builder in multiple regions, are just benefiting from this enormous demand. So every house they’re building, the profits just go up every month because prices keep going up.”
Lennar, a Florida-based home construction company, has suffered…