The trade war is back on full tilt.
Economic growth is slowing.
Stock valuations are at a 10 year high.
Add this altogether and you understand why the market quickly retreated from recent highs on Thursday and Friday. And likely the downside risk remains in place until there is a bit more optimism restored on the China trade situation.
Because of that I spent a lot of time this weekend trying to isolate the safest stocks to consider at this time. The kind of stocks that won’t just survive a downturn…but actually have the right ingredients to thrive. 7 stocks emerged from this search with many being the most stable household names:
And yes, they should be the most stable companies. That’s exactly what we need more of at a more trying time like this.
Let’s dig in deeper on the exact parameters I used to isolate these stocks that should outperform in this volatile market environment.
- POWR Rating of A or B = proof of a stocks momentum
- Large caps only ($10 billion market cap or higher)
- 3%+ dividend yield. Want it well above the S&P average dividend yield and 10 year Treasury yield. And thus a beacon for income seeking investors.
- Defensive industries only: Consumer Staples, Medical, Utilities (includes telecom and pipelines).
- Average earnings beat greater than 0% the past 4 quarters. This is meant to show a consistency of earnings quality with little risk of faltering in the future.
- Minimum 5% upside from current price to average target price. You’d be surprised how much this criteria narrowed up the list because the low rate environment has led to many of these stocks being bid up beyond fair value. Gladly each of these stocks has 8 to 18% upside potential to fair value.
What should stand out from the list above is how many more parameters I put in. About 2X more than most screens I run. That’s because I am really narrowing down to the stocks with the most positives and thus the least question marks. Those are the ones investors will run to during these “Flight to Safety” times.
Check out the rest of the list below. When you see a stock you like then click on the ticker to research further. Remember that the POWR Ratings system has 4 component elements that help you explore the full attractiveness of the stock.
(Disclaimer: EPD is the most recent stock added to the Reitmeister Total Return portfolio).
Get your research started below:
|Company||Ticker||Price||Avg. Target Price||Upside %||Market Cap ($mil)||Avg EPS Surp %||Div Yield %|
Also here are links to 3 other popular destinations to make the best use of the POWR Ratings:
Full List of “A ”Rated Strong Buy Stocks– See all the top rated stocks.
About the POWR Ratings– Learn what’s build inside the POWR Ratings that helps find stocks ready to outperform.
Reitmeister Total Return portfolio. This is where Steve Reitmeister employs his 40 years of investment experience to hand select the best POWR Ratings stocks.
Verizon Communications Inc. (VZ - Get Rating) shares closed at $55.59 on Friday, up $0.33 (+0.60%). Year-to-date, Verizon Communications Inc. (VZ - Get Rating) has gained 2.00%, versus a 18.17% rise in the benchmark S&P 500 index during the same period.
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About the Author: Steve Reitmeister
Steve is better known to the StockNews audience as “Reity”. Not only is he the CEO of the firm, but he also draws upon 40 years of investment experience to help you enjoy more financial success. Learn more about Steve’s background, along with links to his most recent articles and stock picks. More...
More Resources for the Stocks in this Article
|Ticker||POWR Rating||Industry Rank||Rank in Industry|
|VZ||Get Rating||Get Rating||Get Rating|
|AMGN||Get Rating||Get Rating||Get Rating|
|CAG||Get Rating||Get Rating||Get Rating|
|GSK||Get Rating||Get Rating||Get Rating|
|PM||Get Rating||Get Rating||Get Rating|