7 A Safe Stock You Can Rely On When The Market Declines


Back in August, I made an argument why Now is the time to buy safe stocks. A little over a month later, that’s still the case. The volatility and uncertainty that has rocked the stock market so far in 2022 isn’t showing many signs of giving up anytime soon.

The Federal Reserve continues to raise interest rates. This is likely to continue, as interest rates remain at their highest levels in several decades. Higher interest rates are likely to continue to pressure the speculative stocks that have thrived during the 2020/2021 bull market.

Besides hurting the market, according to the World Bank, raising interest rates by the Federal Reserve and other central banks increases the chances of a global recession. This may affect the operating results of many companies (both enterprise and early stage), which also presents a challenge to the recovery of shares.

However, the frustrating prospect of more pain in the future doesn’t mean you need to stay in cash. Your best option is to remain invested, but go on the defensive. You can achieve this by focusing on the names of such 7 safe stocks. Everyone is likely to see continued resilience in this bear market.

AMPHamvastar pharmaceuticalsUSD 28.38
BSMblack stone mineralsUSD 15.67
CMCcommercial metals$38.18
CPBCampbell’s soupUSD 47.81
DJgeneral dollarUSD 243.73
GLPGlobal PartnersUSD 28.40
NSSCNapco Security Technologies$30.10

Amvastar Pharmaceuticals (AMPH)

amvastar pharmaceuticals (NASDAQ:AMPH) is one of the best safe stocks out there right now for many reasons. First, as you can tell from its name, it is in the healthcare sector.

Recession-resistant companies that provide healthcare products/services are in a much better position when it comes to riding a downturn. However, the allure of the AMPH stock goes beyond this. Its portfolio of branded and generic treatments provides steady cash flow. The company also has a strong balance sheet,

that it $183.4 million of cash position It far exceeds the amount of long-term debt and other non-current liabilities on the balance sheet (about $104 million). Best of all, Amphastar is trading at a reasonable price (17.1 times earnings).

up over 26% year-to-date, and while the stock market in general is down double digits during this time frame, the good performance is likely to continue during this time of generally negative market sentiment.

AMPH stock gets an A rating in my country Workbook portfolio.

Black Stone Minerals LP (BSM)

With soaring energy prices, it is not surprising black stone minerals (New York Stock Exchange:BSM) has paid off for investors so far in 2022, and not just in terms of price hikes.

Besides up 49% since January, BSM stock investors also received a total of $1.09 in dividends. This gives it a total return for the year well above 50%.

with Oil prices fall on fears of recessionAt first, you might think you missed the boat with such a solid performance. Fortunately, this is not the case. Even as oil has retreated from the highs recorded earlier this year due to the Russian invasion of Ukraine.

At least, not when the US Energy Information Administration predicts crude oil and natural gas prices Stay above 2020 and 2021 price levels through 2023. This points to more gains, and more significant dividend payments, for Black Stone Minerals shares.

BSM stock gets an A rating in my country Workbook portfolio.

Commercial Metals (CMC)

commercial metal (New York Stock Exchange:CMC) he is A major supplier of recycled steel. Like Black Stone Minerals benefiting from the Russia-related tailwind for oil, this company has benefited from the Russia-related tailwind in the steel business.

The geopolitical crisis led to a significant increase in the shares of CMC. The steel supply shocks set the stage for strong results during the third quarter of the fiscal year (ending May, fourth-quarter numbers due October 13).

Certainly, with the economic slowdown in China, and growing concerns over the global downturn of the steel industry, the market does not expect continued strong operating performance.

However, it is possible that this sentiment has been overpriced in its stock. You can buy the stock today at a very low valuation (only 4.6x earnings). Since it can get through a crash cycle much better than the old steel producers, the drop in its profits after the latest windfall may not be as big as currently expected.

CMC stock gets an A rating in my country Workbook portfolio.

Campbell’s Soup (CPB)

After taking a look at a few safe under-the-radar stocks, let’s dive into one that is more popular as a safe haven during tough times. Campbell’s soup (New York Stock Exchange:CPB) is a stock that needs little introduction. As a producer of packaged food products (essential consumer goods), it is in the business of anti-stagnation.

CPB stock pays a fixed dividend to go along with its steady operations. While dividend growth has been minimal over the past five years (averaging 1.12% per year), its current payments give it a solid 3.1% forward return.

Since it is trading at a reasonable price (16.4 times earnings), an additional rise in interest rates will not affect it in the same way it is likely to affect stock trading at higher valuations. All of this suggests that stocks, which are up about 9% so far this year, continue to generate positive returns during this rough market correction.

CPB stock has a B rating in my country Workbook portfolio.

Dollar General (DG)

Source: Jonathan Weiss / Shutterstock.com

Inflation and recession fears may be bad news for most stocks, but they’ve been positive for them general dollar (New York Stock Exchange:DJ). Its stock has weathered this bear market, thanks to the overall headwinds that helped drive traffic to discount retail stores.

In the last quarter, the company reported a 9% A jump in net sales, a double (10.8%) jump in earnings per share. As economic conditions worsen, these strong results may continue in the coming quarters. Especially as the company sees Strong increase in traffic from the richest customers.

According to CEO Todd Vasos, the company has seen the largest increase in shoppers from households earning $100,000 or more per year. Trading for 21.1 times earnings, DG stock may seem more expensive than many other safe-haven stocks. However, the higher dividend growth helps justify this higher multiplier.

DG shares have a B rating in my country Workbook portfolio.

Global Partners (GLP)

Higher prices and dividends yielded solid returns for investors in Global Partners (New York Stock Exchange:GLP) Mastering the units of the limited partnership.

The energy boom was a bottom-line boon for the gasoline wholesaler and retailer. Again, while gas prices have fallen recently, they are likely to remain at elevated levels compared to levels seen in 2020 and 2021.

In turn, this will enable GLP stock to continue to generate solid returns just to maintain its 61 percent quarterly earnings per share. This is even if it is barely moving higher.

At today’s prices, this dividend yield gives a forward return of about 8.6%.

Trading for only 4x earnings, and a high return, the current pessimism about energy stocks is working in your favor with Global Partners LP. With his high return alone, he can provide above-average returns during this bear market.

GLP stock has an A rating on my Workbook portfolio.

Napco Security Technologies (NSSC)

Napco Security Technologies (NASDAQ:NSSC) The stock price has nearly doubled since May.

In the last quarter, revenue increased 22% compared to the previous quarter. Recurring revenue increased by an even greater amount (33%). Net income grew 36% year over year (or year over year). This indicates its success in pivoting towards a SaaS-based revenue model.

High growth is likely to continue, as recent trends increase demand for its products. In particular, the demand among end users such as schools and universities.

With a forward earnings multiple of 43x, it is significantly more expensive than the other safe stocks listed above. However, with earnings expected to continue growing at a significant pace, it could maintain this rich valuation.

NSSC stock gets an A rating in my country Workbook portfolio.

Published first on InvestorPlace. I read here.

Featured Image Credits: Photography by Brett Sayles; Pixels. Thank you!


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