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Barron's: Buy These 8 Stocks to Survive 'Bizarre' Market

Barron's: Buy These 8 Stocks to Survive 'Bizarre' Market
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Thursday, 22 August 2019 05:16 PM

Some of the best companies to invest in now, a time of rising strangeness in the stock market, come in two flavors: those that aren’t too tied to economic shifts, and those with high dividend yields.

The current economic backdrop has even some veteran investors scratching their heads. Interest rates are ultralow. Central banks are uncertain when consumer prices will pick up.

The U.K.’s economy shrank for the first time in years. German bonds pay less than zero out to 30 years. And the U.S. grew at just 2.1% last quarter, down from 3.1% in first quarter.

Against that “bizarre landscape,” four companies were deemed by Bank of America strategists as top “idiosyncratic growth” stocks and four as “sturdy high-yielders,” Barron’s said in a recent cover story.

  • Amazon.com (AMZN) free cash flow is expected to more than double in three years, which helps justify its expensive shares.
  • Arista Networks (ANET), a cloud networking company, is expected to grow earnings per share by 21% this year.
  • Equinix (EQIX), a real estate investment trust, is expected to increase revenue by 10% a year over the next few years.
  • Merck (MRK) has a lung cancer drug, Keytruda, with long-term potential of $20 billion a year, up from the $7 billion it did last year.
  • Broadcom (AVGO) generates more than twice the free cash flow it needs to pay its dividend.
  • Target (TGT) is best positioned to benefit compared to failing retailers, which put $7.5 billion in sales up for grabs this year, according to Goldman Sachs.
  • Verizon Communications (VZ) has a dividend yield of 4.3% and plenty of free cash flow.
  • Weyerhaeuser (WY), the largest private owner of timberland in North America, has strong free cash flow, says Stephens analyst Mark Connelly, who upgraded his rating to Overweight in April.

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Some of the best companies to invest in now, a time of rising strangeness in the stock market, come in two flavors: those that aren’t too tied to economic shifts, and those with high dividend yields.
stocks, buy, now, earnings, kings
297
2019-16-22
Thursday, 22 August 2019 05:16 PM
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