Investing in 2014? These Are Your 5 Best Bets

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After a historic rally in 2013, market watchers are expecting relatively modest returns from equities in 2014. Kiplinger suggests ”A reasonable range to expect would be 8% to 12% returns, including dividends,” and Kohlberg Kravis Roberts & Co. (NYSE:KKR) expects to see the S&P 500 close the year at a level of about 2,000.

There’s a lot of vapid conversation to be had about which stocks will do well and which won’t in 2014, but behind all the hype, there are really only a few basic principles prospective investors should keep in mind. Chief among them is earnings growth. Here are five top stocks compiled by Statistic Brain that are favored by market gurus as 2014 picks because of strong expected annual earnings growth.

5. General Motors (NYSE:GM)

America’s largest car maker has experienced a surge of growth in the wake of the financial crisis as the auto market recovers alongside the economy. No longer Government Motors, GM is expected to post annual earnings growth of about 16 percent over the next five years, slightly higher than growth of about 15 percent over the past five years.

Newly appointed CEO Mary Barra summed up her plans for the next few years in one word: “accelerate.” Under the leadership of Dan Akerson, General Motors launched its initial public offering, posted record profits, and established a leading foothold in China’s increasingly important auto market. Barra has promised more of the same, swearing to uphold the company’s fortress balance sheet and increasing returns to shareholders.

During his last few weeks as chief executive, Dan Akerson said, “The end of the ‘Government Motors’ era has cleared the runway,” and added that at the time, GM suffered from out-of-control costs, wasteful complexity, diminished quality, and had lost sight of its customers. Now, though, under Barra’s leadership, the company is looking forward to at least half a decade of growing earnings.

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