14 stocks that are consistent winners in a chaotic market: Bank of America

• Markets have been unusually volatile in recent weeks due to conflicting economic data.
• Bank of America is optimistic about the economy, but it's less bullish about US stocks.
• Here are 14 companies that have consistently dominated for a decade.

A wild month in markets has muddled the investing landscape ahead of what promises to be a turbulent autumn.

Mixed signals abound after the S&P 500 followed a 6.1% sell-off in the first three days of August with an equally astounding 8.1% rally, resulting in a modest monthly gain. During the meltdown, the CBOE Volatility Index spiked at the fastest rate on record, according to Bank of America.

Those whiplash-inducing swings have led to confusion about the US economy, valuations, and the path forward for stocks.

US stocks have limited upside despite overstated recession risk

Although warnings about a recession have gotten louder lately, investors don't seem worried about a downturn. BofA's August global fund manager survey found that over three-quarters of respondents expect a so-called soft landing for the economy, while only 13% are bracing for a growth contraction.

BofA shares that upbeat sentiment about the economy, wrote Jared Woodard, who heads up the firm's research investment committee. The weak July jobs report may be due to last month's bad weather, as the labor market has cooled but is far healthier than before past recessions.

"Our economists believe US economic data weakened in July, but not enough to throw a 'soft landing' off course," Woodard wrote in a mid-August note. "As long as layoffs remain low and the labor force is growing, a 'soft landing' can be achieved."

However, confidence in the economy is dangerously close to complacency. Stock allocations are close to all-time highs, Woodard noted. As investors tilted their portfolios toward equities, the S&P 500's valuation has been stretched to an uncomfortably high 26x earnings.

Even if the US economy stays on solid ground, US stocks seem destined for a stretch of returns in the low-single-digit range, according to BofA. Savita Subramanian, the firm's head of US equity & quantitative strategy, thinks the S&P 500 will rise just 2% a year for the next decade, or 4% including dividends. However, the firm has issued such warnings in years past to no avail.

The S&P 500's forthcoming struggles won't only be because of expensive valuations. Instead, BofA believes that large growth stocks, which have mostly carried the market since the start of 2023, will fall back to the pack as they fall short of sky-high expectations. Investors are starting to see that companies tied to artificial intelligence can't grow earnings exponentially forever.

"'AI hype' days are over," Woodard wrote. "Investors are now expecting material capex spending to show up in the bottom line. This is to the benefit of the 'S&P 493,' as growth for the Magnificent 7 slows and manufacturing activity picks up."

With all of that said, BofA isn't bearish. The firm still thinks the long-term bull market is intact, as Woodard noted that US stocks are less than two years into what's usually at least a five-year uptrend. Besides, its year-end S&P 500 price target of 5,400 is only 3% below where the index is trading now.

14 stocks that can continue to win

Investors have a lot to process, as they should be cautiously optimistic about the economy despite weakening indicators without going overboard in US stocks, given their lofty valuations and ebullient sentiment. And while the S&P 500's returns are capped, the bull market has legs.

That's to say nothing of the potentially monumental macroeconomic events this fall, including interest rate cuts and the outcome of US elections. Volatility, if not outright chaos, is ahead.

However, investors can rest easy in an uneven backdrop by buying 14 so-called "all-weather" stocks highlighted in Woodard's note. These companies have outperformed year-to-date and in the last three, five, and 10 years, showing that they can hold up in both value and growth environments. Besides, all 14 have buy ratings from BofA analysts.

Below are those consistently strong stocks, along with each one's ticker, market capitalization, and sector. Stocks are listed alphabetically by sector and within their sector, if applicable.