Tech

7 Safe Stocks To Rely On In A Volatile Market



Back in August, I argued why Now is the right time to buy safe stocks. Just over a month later, this continues to happen. The volatility and uncertainty that has rocked the stock market so far in 2022 shows little sign of a possible let-down any time soon.

The Federal Reserve continues to raise interest rates. This is likely to continue, as interest rates remain at their highest levels in decades. Escalating interest rates are likely to continue to weigh on speculative stocks that thrive in the 2020/2021 bull market.

Along with hurting markets, according to the World Bank, interest rate hikes by the Fed and other central banks are increasing the risk of a global recession. This could affect the performance of many companies (both early-stage and early-stage), and challenge the stock’s rally.

However, the daunting prospect with lots of pain ahead doesn’t mean you need to sit on the cash. Your better option is to keep investing, but be on the defensive. You can achieve this, by focusing on names like these seven safe stocks. Each is likely to see their resilience continue in this bear market.

AMPH Amphastar Pharmaceuticals $28.38
BSM Black rock minerals $15.67
CMC Commercial Metals $38.18
CPB Campbell Soup $47.81
DG Common Dollar $243.73
GLP Global partner $28.40
NSSC Napco . security technology $30.10

Amphastar Pharmaceuticals (AMPH)

Amphastar Pharmaceuticals (NASDAQ:AMPH) is one of the best safe stocks right now for several reasons. First, as you may know from its name, it belongs to the healthcare sector.

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

Its $183.4 million cash far exceeds the amount of long-term debt and other long-term liabilities on the balance sheet (about $104 million). Best of all, Amphastar trades at a fair valuation (17.1x earnings).

Up over 26% so far, while the overall stock market is down double digits in this time frame, it is likely to continue to perform well during this overall negative market sentiment. .

AMPH stock earns an A rating in Portfolio Scoring Machine.

LP Black Rock Mineral (BSM)

With the massive increase in energy prices, it’s no surprise Black rock minerals (NYSE:BSM) has paid off for investors so far in 2022, and not just in terms of upside.

In addition to the 49% increase since January, investors in BSM stock have also received a total of $1.09 in dividends. This gives it a 50% higher total return for the year.

With Oil prices fall on recession fears, at first you might think you’ve sailed with this powerful performer. Fortunately, however, that is not the case. Even if oil has fallen from the highs it reached earlier this year due to Russia’s invasion of Ukraine.

At least, not when the US Energy Information Administration expects crude oil and natural gas prices to remain above 2020 and 2021 prices until 2023. This results in more profits and larger dividend payouts for Blackstone Minerals stock.

BSM stock is rated A in Portfolio Scoring Machine.

Commercial Metals (CMC)

Commercial Metals (NYSE:CMC) To be major supplier of recycled steel. Just as Black Stone Minerals has benefited from Russian outflows for oil, this company has benefited from Russia-related tailflows in the steel sector.

The geopolitical crisis has resulted in a big hit for CMC stock. Steel supply shocks paved the way for strong results in its third fiscal quarter (ended in May, Q4 numbers scheduled for October 13).

Certainly, with China’s economic slowdown and growing concerns about a global slowdown for the steel industry, the market does not expect its strong business performance to continue.

However, it is possible that this sentiment has turned out to be overpriced for its stock. You can buy shares today at a super low valuation (earnings only 4.6x). Since it could go down much better than its legacy steelmakers, the drop in earnings following its latest turbulence may not be as dramatic as currently expected.

CMC stock is rated A in Portfolio Scoring Machine.

Campbell Soup (CPB)

After taking a look at some undisclosed safety stocks, let’s dive into some of the stocks that are generally seen as safe havens during challenging times. Campbell Soup (NYSE:CPB) is a stock that needs little introduction. As a producer of packaged food products (a consumer staple), it is in a recession-proof business.

CPB stock pays a steady dividend along with its steady performance. While dividend growth has been meager over the past five years (annual average of 1.12%), the current payout gives it a solid forward yield of 3.1%.

Since it trades at a fair valuation (16.4x earnings), the extra interest won’t affect it in the same way it would potentially affect trading stocks at a higher valuation. . All of this translates into equities, which are up about 9% so far this year, continuing to deliver positive returns during this tough market period.

CPB stock earns a B rating in Portfolio Scoring Machine.

Common Dollar (DG)

Source: Jonathan Weiss / Shutterstock.com

Worries about inflation and recession can be bad news for most stocks, but they’re a positive for Common Dollar (NYSE:DG). Its stock has held up well in this bear market, thanks to macro headwinds that boosted traffic at its discount retail stores.

Last quarter, the company reported a 9% Net sales skyrocketed, earnings per share increased by double digits (10.8%). As economic conditions worsen, such strong results are likely to continue in the coming quarters. As special as the company can see a dramatic increase in traffic from more affluent customers.

According to CEO Todd Vasos, the company has seen the biggest increase in shoppers from households with incomes of $100,000 or more per year. Trading at 21x earnings, DG stock can look more expensive than many other safe stocks. However, high earnings growth helps justify this higher multiple.

DG stock is rated B in Portfolio Scoring Machine.

Global Partnership (GLP)

The price increase and dividends have resulted in strong returns for investors Global partner (NYSE:GLP) the totality of limited partnership units.

The energy boom has benefited the margins of this petroleum wholesaler and retailer. Again, while gas prices have recently dropped, they are likely to remain high compared to levels seen in 2020 and 2021.

In turn, this will allow GLP stock to continue to generate strong returns simply from maintaining its current 61%/share quarterly dividend. That’s even if it barely moves higher.

At today’s price, this payment gives the stock a forward yield of about 8.6%.

Trading only 4x earnings and high returns, the current pessimism on energy stocks is in your favor with Global Partners LP. Only through high yields can it deliver above-average returns in this bear market.

GLP stock received an A rating in Portfolio Scoring Machine.

Napco Security Technologies (NSSC)

Napco . security technology (NASDAQ:NSSC) the stock has nearly doubled in price since May.

Last quarter, revenue increased 22% compared to the previous quarter. The recurring revenue increase was even greater (33%). Net income increased 36% year over year (or YoY). This shows its success in pivoting to a SaaS-based revenue model.

The high growth rate is likely to continue as recent trends increase demand for the company’s products. In particular, the demand is in end users such as schools and universities.

With a forward earnings multiple of 43 times, it’s much more expensive than the other safety stocks listed above. However, with the expectation that it will continue to grow earnings at an outstanding rate, it can maintain this high valuation.

NSSC stock is rated A in Portfolio Scoring Machine.

Originally published on InvestorPlace. Read here.

Featured image credit: Photo by Brett Sayles; Bark; Thank you!



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