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Top 5 Low-Beta Stocks to Stay Safe from Near-Term Volatility
July is turning out to be the best month for Wall Street so far in 2022. U.S. stock markets have been suffering from severe volatility since the beginning of this year after witnessing an astonishing rally in the last-two coronavirus-ridden years.
Year to date, all the major stock indexes have suffered to a great extent. On a positive note, situations have changed in July. However, volatility may reappear in the last week of this month, which market participants have termed as the most vital week of this summer.
Consequently, it should be fruitful to invest in low-beta (beta <1) stocks to safeguard your portfolio. Five such stocks with a favorable Zacks Rank are - LPL Financial Holdings Inc., Dollar Tree Inc., Lamb Weston Holdings Inc., M&T Bank Corp. and Corteva Inc.
We have narrowed our search to five large-cap (market capital > $10 billion) low-beta stocks. These companies have strong potential for the rest of 2022 and have seen positive earnings estimate revisions in the last 60 days. Each of our picks carries a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here.
LPL Financial has been benefiting from strategic acquisitions, including the buyout of Waddell & Reed's wealth management business. Solid advisor productivity and recruiting efforts are expected to keep aiding advisory revenues of LPLA. Moreover, LPL Financial's efficient capital deployment activities reflect a solid balance sheet position.
LPLA has an expected earnings growth rate of 42.5% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 2.6% over the last 7 days. LPL Financial has a beta of 0.95.
Dollar Tree is a customer-oriented, value-driven variety store operating at a one-dollar price point. DLTR operates through two segments, Dollar Tree and Family Dollar. Following the robust first-quarter fiscal 2022 performance, DLTR raised its guidance for fiscal 2022 and provided a decent second-quarter view.
Dollar Tree benefited from the completion of the $1.25 multi-price point initiative at the Dollar Tree stores, as well as robust margins, despite the increase in freight costs and SG&A expenses.
Dollar Tree has an expected earnings growth rate of 40.5% for the current year (ending January 2023). The Zacks Consensus Estimate for current-year earnings has improved 0.1% over the last 30 days. DLTR has a beta of 0.68.
M&T Bank provides banking services that offer deposits, business loans and leases, and credit cards and cash management, payroll and letters of credit services to small businesses and professionals. Organic growth, driven by higher fee income, loans and deposits, will likely increase MTB's revenues.
M&T Bank is growing inorganically backed by a sound liquidity position. The acquisition of People's United Financial is expected to be accretive to its earnings. Capital deployment activities seem sustainable, given its favorable debt/equity ratio.
M&T Bank has an expected earnings growth rate of 10.3% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 2.8% over the last 7 days. MTB has a beta of 0.89.
Lamb Weston has been benefiting from the recovery in Foodservice business. The trend was witnessed in third-quarter fiscal 2022, wherein Foodservice sales soared 34% to $294.5 million. Volumes benefited from the continued rebound in demand at full-service restaurants and non-commercial channels, like lodging and hospitality.
Further, LW's top line is benefiting from robust price/mix. During the third quarter, price/mix increased 12%, mainly reflecting gains from pricing actions in the company's business segments undertaken to counter input, manufacturing and transportation cost inflation. Apart from this, Lamb Weston's efforts to boost offerings and expand capacity enable the company to effectively meet rising demand conditions for snacks and fries.
LW has an expected earnings growth rate of 47% for the current year (ending May 2023). The Zacks Consensus Estimate for current-year earnings has improved 0.4% over the last 30 days. Lamb Weston has a beta of 0.50.
Corteva operates in the agriculture business. CTVA operates through two segments, Seed and Crop Protection. Corteva develops and supplies germplasm and traits in corn, soybean and sunflower seed markets. CTVA also supplies products to the agricultural input industry that protects against weeds, insects and other pests, and diseases as well as enhances crop health.
Corteva has an expected earnings growth rate of 18.6% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 0.4% over the last 60 days. CTVA has a beta of 0.73.
Why Haven't You Looked at Zacks' Top Stocks?
Our 5 best-performing strategies have blown away the S&P's impressive +28.8% gain in 2021. Amazingly, they soared +40.3%, +48.2%, +67.6%, +94.4%, and +95.3%. Today you can access their live picks without cost or obligation.
Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material.
About Screen of the Week
Zacks.com created the first and best screening system on the web earning the distinction as the "#1 site for screening stocks" by Money Magazine. But powerful screening tools is just the start. That is why Zacks created the Screen of the Week to highlight profitable stock picking strategies that investors can actively use.
Strong Stocks that Should Be in the News
Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has more than doubled the market from 1988 through 2016. Its average gain has been a stellar +25% per year.
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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Zacks.com featured highlights LPL Financial, Dollar Tree, Lamb Weston, M&T Bank and Corteva
For Immediate Release
Chicago, IL – July 27, 2022 – Stocks in this week’s article are LPL Financial Holdings Inc. (LPLA - Free Report) , Dollar Tree Inc. (DLTR - Free Report) , Lamb Weston Holdings Inc. (LW - Free Report) , M&T Bank Corp. (MTB - Free Report) and Corteva Inc. (CTVA - Free Report) .
Top 5 Low-Beta Stocks to Stay Safe from Near-Term Volatility
July is turning out to be the best month for Wall Street so far in 2022. U.S. stock markets have been suffering from severe volatility since the beginning of this year after witnessing an astonishing rally in the last-two coronavirus-ridden years.
Year to date, all the major stock indexes have suffered to a great extent. On a positive note, situations have changed in July. However, volatility may reappear in the last week of this month, which market participants have termed as the most vital week of this summer.
Consequently, it should be fruitful to invest in low-beta (beta <1) stocks to safeguard your portfolio. Five such stocks with a favorable Zacks Rank are - LPL Financial Holdings Inc., Dollar Tree Inc., Lamb Weston Holdings Inc., M&T Bank Corp. and Corteva Inc.
We have narrowed our search to five large-cap (market capital > $10 billion) low-beta stocks. These companies have strong potential for the rest of 2022 and have seen positive earnings estimate revisions in the last 60 days. Each of our picks carries a Zacks Rank #1 (Strong Buy). You can see the complete list of today's Zacks #1 Rank stocks here.
LPL Financial has been benefiting from strategic acquisitions, including the buyout of Waddell & Reed's wealth management business. Solid advisor productivity and recruiting efforts are expected to keep aiding advisory revenues of LPLA. Moreover, LPL Financial's efficient capital deployment activities reflect a solid balance sheet position.
LPLA has an expected earnings growth rate of 42.5% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 2.6% over the last 7 days. LPL Financial has a beta of 0.95.
Dollar Tree is a customer-oriented, value-driven variety store operating at a one-dollar price point. DLTR operates through two segments, Dollar Tree and Family Dollar. Following the robust first-quarter fiscal 2022 performance, DLTR raised its guidance for fiscal 2022 and provided a decent second-quarter view.
Dollar Tree benefited from the completion of the $1.25 multi-price point initiative at the Dollar Tree stores, as well as robust margins, despite the increase in freight costs and SG&A expenses.
Dollar Tree has an expected earnings growth rate of 40.5% for the current year (ending January 2023). The Zacks Consensus Estimate for current-year earnings has improved 0.1% over the last 30 days. DLTR has a beta of 0.68.
M&T Bank provides banking services that offer deposits, business loans and leases, and credit cards and cash management, payroll and letters of credit services to small businesses and professionals. Organic growth, driven by higher fee income, loans and deposits, will likely increase MTB's revenues.
M&T Bank is growing inorganically backed by a sound liquidity position. The acquisition of People's United Financial is expected to be accretive to its earnings. Capital deployment activities seem sustainable, given its favorable debt/equity ratio.
M&T Bank has an expected earnings growth rate of 10.3% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 2.8% over the last 7 days. MTB has a beta of 0.89.
Lamb Weston has been benefiting from the recovery in Foodservice business. The trend was witnessed in third-quarter fiscal 2022, wherein Foodservice sales soared 34% to $294.5 million. Volumes benefited from the continued rebound in demand at full-service restaurants and non-commercial channels, like lodging and hospitality.
Further, LW's top line is benefiting from robust price/mix. During the third quarter, price/mix increased 12%, mainly reflecting gains from pricing actions in the company's business segments undertaken to counter input, manufacturing and transportation cost inflation. Apart from this, Lamb Weston's efforts to boost offerings and expand capacity enable the company to effectively meet rising demand conditions for snacks and fries.
LW has an expected earnings growth rate of 47% for the current year (ending May 2023). The Zacks Consensus Estimate for current-year earnings has improved 0.4% over the last 30 days. Lamb Weston has a beta of 0.50.
Corteva operates in the agriculture business. CTVA operates through two segments, Seed and Crop Protection. Corteva develops and supplies germplasm and traits in corn, soybean and sunflower seed markets. CTVA also supplies products to the agricultural input industry that protects against weeds, insects and other pests, and diseases as well as enhances crop health.
Corteva has an expected earnings growth rate of 18.6% for the current year. The Zacks Consensus Estimate for current-year earnings has improved 0.4% over the last 60 days. CTVA has a beta of 0.73.
Why Haven't You Looked at Zacks' Top Stocks?
Our 5 best-performing strategies have blown away the S&P's impressive +28.8% gain in 2021. Amazingly, they soared +40.3%, +48.2%, +67.6%, +94.4%, and +95.3%. Today you can access their live picks without cost or obligation.
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For the rest of this Screen of the Week article please visit Zacks.com at: https://www.zacks.com/stock/news/1957739/top-5-low-beta-stocks-to-stay-safe-from-near-term-volatility
Disclosure: Officers, directors and/or employees of Zacks Investment Research may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material. An affiliated investment advisory firm may own or have sold short securities and/or hold long and/or short positions in options that are mentioned in this material.
About Screen of the Week
Zacks.com created the first and best screening system on the web earning the distinction as the "#1 site for screening stocks" by Money Magazine. But powerful screening tools is just the start. That is why Zacks created the Screen of the Week to highlight profitable stock picking strategies that investors can actively use.
Strong Stocks that Should Be in the News
Many are little publicized and fly under the Wall Street radar. They're virtually unknown to the general public. Yet today's 220 Zacks Rank #1 "Strong Buys" were generated by the stock-picking system that has more than doubled the market from 1988 through 2016. Its average gain has been a stellar +25% per year.
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Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
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Visit: https://www.zacks.com/
Zacks.com provides investment resources and informs you of these resources, which you may choose to use in making your own investment decisions. Zacks is providing information on this resource to you subject to the Zacks "Terms and Conditions of Service" disclaimer. www.zacks.com/disclaimer.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.