Oppenheimer: S&P 500 top might not come until 2025; spotlights infrastructure stocks

Oppenheimer argued on Monday that the S&P 500 (SP500) is poised for a move higher when looking back at macro similarities from 1987 to 1990. The key takeaway from the '87-'90 road map was that the Fed’s first rate cut proceeded the top in market breadth by 4 months and the top in the S&P 500 by 12 months.

“Assuming the Fed cuts its policy rate over the coming months, this means a market top may not develop until 2025. For now, we think a beta breakout supports a continuation of the bull,” Oppenheimer indicated in an investor note.

Related to this outlook, Oppenheimer also pointed to infrastructure as a buying opportunity, spotlighting the Global X U.S. Infrastructure Development ETF (BATS:PAVE).

“Relative to the S&P 500, PAVE is emerging higher from a year-long consolidation range which we see as a resumption of long-term leadership. We see PAVE as an attractive source of beta, and the broadness of bottom-up strength adds to our conviction,” the firm stated.

Here are some other specific buying opportunities that Oppenheimer suggested:

• AECOM (ACM)
• Atkore Inc. (ATKR)
• Acuity Brands, Inc. (AYI)
• Carlisle Companies Incorporated (CSL)
• H&E Equipment Services (HEES)
• Nucor Corporation (NUE)
• Pentair plc (PNR)
• Reliance (RS)
• Steel Dynamics (STLD)
• Summit Materials (SUM)
• Advanced Drainage Systems (WMS)
• Zurn Elkay Water Solutions Corporation (ZWS)

Moreover, Oppenheimer said to hedge its beta exposure it recommends selling certain high beta losers. One name that it included was the iShares U.S. Medical Devices ETF (IHI) Other names listed were:

• AtriCure (ATRC)
• CONMED Corporation (CNMD)
• Inspire Medical Systems (INSP)
• NovoCure Limited (NVCR)