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Buy These 3 Ultra-Safe Stocks if You're Worried About a Recession
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The year 2022 has been tumultuous for investors as the economy is facing record-level inflation and geopolitical headwinds. The war between Ukraine and Russia raised commodity prices substantially, leaving the Fed with no option but to hike the interest rate. Evidently, soaring inflation, higher cost of borrowings and the ongoing conflict are enough to keep investors on their toes and look for some ultra-safe stocks.
The Fed’s tightening of monetary policy has raised fears of a recession. The Fed Chair Jerome Powell intends to continue hiking interest rates as long as inflation remains elevated. An aggressive interest rate hike doesn’t bode well for the stock market. It affects consumer spending habits and deters economic growth. Economists have warned that the rapid monetary tightening policy could push the economy into recession.
Hence, creating a portfolio of stocks with strong fundamentals and solid history of dividend payout to provide a cushion from drawdowns is the need of the hour. To top it, we have focused on low-beta stocks, thus shielding the portfolio against market volatility. These stocks also boast a Zacks Rank #1 (Strong Buy) or 2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Employers Holdings (EIG - Free Report) is a specialty provider of workers' compensation insurance focused on select small businesses engaged in low to medium-hazard industries. The company has been gaining from strength in new and renewal business writings within its Employers segment and Cerity segment. Also, a strong balance sheet and underwriting capital bodes well. Shares of EIG have gained 14.7% year to date and has a beta of 0.23.
This Zacks Rank #1 company pays out an annual dividend of $1.04 per share, giving a 2.4% yield at the current stock price. EIG’s payout ratio is 38, with a five-year dividend growth rate of 8.4%. The Zacks Consensus Estimate for its current-year earnings has moved up 14% over the past 60 days. The company’s expected earnings growth rate for the current year is 3.4%.
Conagra Brands (CAG - Free Report) is one of the leading branded food companies in North America. The company’s efficient pricing initiatives have been offering respite amid the cost headwinds. Also, gains from innovation and other brand-building efforts have been aiding it. Shares of CAG have gained 16.2% year to date and has a beta of 0.59.
This Zacks Rank #2 company pays out an annual dividend of $1.32 per share, giving a 3.5% yield at the current stock price. CAG’s payout ratio is 54, with a five-year dividend growth rate of 11.2%. The Zacks Consensus Estimate for its current-year earnings has moved up 1.2% over the past 60 days. The company’s expected earnings growth rate for the current year is 3.4%.
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General Mills (GIS - Free Report) is a global manufacturer and marketer of branded consumer foods sold through retail stores. The company remains focused on its Accelerate strategy and is on track with prioritizing core markets, global platforms and local brands along with reshaping its portfolio via strategic acquisitions and divestitures. Also, solid Pet segment sales have been a driver. Shares of GIS have gained 31.9% year to date and has a beta of 0.34.
This Zacks Rank #2 company pays out an annual dividend of $2.16 per share, giving a 2.5% yield at the current stock price. GIS’ payout ratio is 53, with a five-year dividend growth rate of 1.5%. The Zacks Consensus Estimate for its current-year earnings has moved up a penny over the past 60 days. The company’s expected earnings growth rate for the current year is 3.8%.
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Buy These 3 Ultra-Safe Stocks if You're Worried About a Recession
The year 2022 has been tumultuous for investors as the economy is facing record-level inflation and geopolitical headwinds. The war between Ukraine and Russia raised commodity prices substantially, leaving the Fed with no option but to hike the interest rate. Evidently, soaring inflation, higher cost of borrowings and the ongoing conflict are enough to keep investors on their toes and look for some ultra-safe stocks.
The Fed’s tightening of monetary policy has raised fears of a recession. The Fed Chair Jerome Powell intends to continue hiking interest rates as long as inflation remains elevated. An aggressive interest rate hike doesn’t bode well for the stock market. It affects consumer spending habits and deters economic growth. Economists have warned that the rapid monetary tightening policy could push the economy into recession.
Hence, creating a portfolio of stocks with strong fundamentals and solid history of dividend payout to provide a cushion from drawdowns is the need of the hour. To top it, we have focused on low-beta stocks, thus shielding the portfolio against market volatility. These stocks also boast a Zacks Rank #1 (Strong Buy) or 2 (Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.
Employers Holdings (EIG - Free Report) is a specialty provider of workers' compensation insurance focused on select small businesses engaged in low to medium-hazard industries. The company has been gaining from strength in new and renewal business writings within its Employers segment and Cerity segment. Also, a strong balance sheet and underwriting capital bodes well. Shares of EIG have gained 14.7% year to date and has a beta of 0.23.
This Zacks Rank #1 company pays out an annual dividend of $1.04 per share, giving a 2.4% yield at the current stock price. EIG’s payout ratio is 38, with a five-year dividend growth rate of 8.4%. The Zacks Consensus Estimate for its current-year earnings has moved up 14% over the past 60 days. The company’s expected earnings growth rate for the current year is 3.4%.
Conagra Brands (CAG - Free Report) is one of the leading branded food companies in North America. The company’s efficient pricing initiatives have been offering respite amid the cost headwinds. Also, gains from innovation and other brand-building efforts have been aiding it. Shares of CAG have gained 16.2% year to date and has a beta of 0.59.
This Zacks Rank #2 company pays out an annual dividend of $1.32 per share, giving a 3.5% yield at the current stock price. CAG’s payout ratio is 54, with a five-year dividend growth rate of 11.2%. The Zacks Consensus Estimate for its current-year earnings has moved up 1.2% over the past 60 days. The company’s expected earnings growth rate for the current year is 3.4%.
Image Source: Zacks Investment Research
General Mills (GIS - Free Report) is a global manufacturer and marketer of branded consumer foods sold through retail stores. The company remains focused on its Accelerate strategy and is on track with prioritizing core markets, global platforms and local brands along with reshaping its portfolio via strategic acquisitions and divestitures. Also, solid Pet segment sales have been a driver. Shares of GIS have gained 31.9% year to date and has a beta of 0.34.
This Zacks Rank #2 company pays out an annual dividend of $2.16 per share, giving a 2.5% yield at the current stock price. GIS’ payout ratio is 53, with a five-year dividend growth rate of 1.5%. The Zacks Consensus Estimate for its current-year earnings has moved up a penny over the past 60 days. The company’s expected earnings growth rate for the current year is 3.8%.