Investors looking for protection — and possibly even outperformance — this year will benefit from being more selective about the quality stocks they buy, according to Bernstein.
The problem this year, however, is that quality stocks are trading at a 12.5% premium to their historical valuation, analyst Sarah McCarthy said in a note.
With this in mind, Bernstein compiled a list of quality stocks that are trading at a "reasonable price."
Tech giant Microsoft came on top of Bernstein's picks of cheap quality stocks with an upside.
Danaher, Adobe, Pioneer Natural Resources, Applied Materials and Elevance Health also made Bernstein's list.