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CPI Looming: 3 Low-Beta Stocks to Combat Volatility
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Tomorrow, we’ll get the latest dose of CPI data. Then, on Thursday, we’ll get another dosage of inflation data with the Producer Price Index (PPI).
As many have become aware, CPI days have consistently been a pivotal point for the market. Things will be no different this time around, especially as many seek clarification on the future pace of rate hikes following a historical year-long tightening campaign.
For those looking to shield themselves from the inevitable volatility, low-beta stocks, such as – Interactive Brokers (IBKR - Free Report) , The Kroger Co. (KR - Free Report) , and Cisco Systems (CSCO - Free Report) – could be of interest.
The chart below illustrates the performance of all three stocks year-to-date, with the S&P 500 blended in as a benchmark.
Image Source: Zacks Investment Research
Let’s take a closer look at each one.
Interactive Brokers
Interactive Brokers Group operates as an automated global electronic market maker and broker. Analysts have upped their earnings expectations across nearly all timeframes over the last 60 days, helping land the stock into a Zacks Rank #2 (Buy).
Image Source: Zacks Investment Research
IBKR posted strong quarterly results in its latest release, exceeding the Zacks Consensus EPS Estimate by more than 12% and delivering a 5.3% revenue surprise. Below is a chart illustrating the company’s revenue on a quarterly basis.
Image Source: Zacks Investment Research
In addition, IBKR shares provide a passive income stream, limiting the impact of drawdowns in other positions; currently, the company’s annual dividend yields 0.5%, below the Zacks Finance sector average.
Image Source: Zacks Investment Research
The Kroger Co.
Founded in 1883, the long-time retailer operates approximately 2,700 retail stores under its various banners and divisions in 35 states. Presently, KR sports a favorable Zacks Rank #1 (Strong Buy).
Image Source: Zacks Investment Research
Kroger shares aren’t expensive by any means, with the company’s 10.8X forward earnings multiple sitting nicely beneath the 12.4X five-year median and the Zacks Retail and Wholesale sector average.
KR carries a Style Score of “B” for Value.
Image Source: Zacks Investment Research
Like IBKR, Kroger rewards its shareholders handsomely; the company’s annual dividend presently yields 2.2%, well above the Zacks sector average of 1.1%.
Impressively, Kroger has displayed a commitment to increasingly rewarding its shareholders, boasting a sizable 15% five-year annualized dividend growth rate.
Image Source: Zacks Investment Research
Cisco Systems
Cisco Systems is an IP-based networking company offering products and services to service providers, companies, commercial users, and individuals. Analysts have taken a bullish stance on the company’s earnings outlook, landing it into a Zacks Rank #2 (Buy).
Image Source: Zacks Investment Research
The market took the company’s latest earnings release in stride, sending shares on an upward trajectory post-earnings. Cisco exceeded the Zacks Consensus EPS Estimate by roughly 2.3% and reported revenue modestly above expectations.
Image Source: Zacks Investment Research
CSCO shares provide exposure to technology paired with a passive income stream; Cisco’s dividend currently yields 3% annually, more than triple that of the Zacks Computer and Technology sector average.
Image Source: Zacks Investment Research
Bottom Line
With CPI looming, investors may want to visit low-beta stocks as a shield against volatility. As we all know by now, CPI days have become quite a market-moving event.
All three low-beta stocks above – Interactive Brokers (IBKR - Free Report) , The Kroger Co. (KR - Free Report) , and Cisco Systems (CSCO - Free Report) – could be considerations for those looking for a shield against volatility.
All three sport improved earnings outlooks, indicating favorable near-term business outlooks.
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CPI Looming: 3 Low-Beta Stocks to Combat Volatility
Tomorrow, we’ll get the latest dose of CPI data. Then, on Thursday, we’ll get another dosage of inflation data with the Producer Price Index (PPI).
As many have become aware, CPI days have consistently been a pivotal point for the market. Things will be no different this time around, especially as many seek clarification on the future pace of rate hikes following a historical year-long tightening campaign.
For those looking to shield themselves from the inevitable volatility, low-beta stocks, such as – Interactive Brokers (IBKR - Free Report) , The Kroger Co. (KR - Free Report) , and Cisco Systems (CSCO - Free Report) – could be of interest.
The chart below illustrates the performance of all three stocks year-to-date, with the S&P 500 blended in as a benchmark.
Image Source: Zacks Investment Research
Let’s take a closer look at each one.
Interactive Brokers
Interactive Brokers Group operates as an automated global electronic market maker and broker. Analysts have upped their earnings expectations across nearly all timeframes over the last 60 days, helping land the stock into a Zacks Rank #2 (Buy).
Image Source: Zacks Investment Research
IBKR posted strong quarterly results in its latest release, exceeding the Zacks Consensus EPS Estimate by more than 12% and delivering a 5.3% revenue surprise. Below is a chart illustrating the company’s revenue on a quarterly basis.
Image Source: Zacks Investment Research
In addition, IBKR shares provide a passive income stream, limiting the impact of drawdowns in other positions; currently, the company’s annual dividend yields 0.5%, below the Zacks Finance sector average.
Image Source: Zacks Investment Research
The Kroger Co.
Founded in 1883, the long-time retailer operates approximately 2,700 retail stores under its various banners and divisions in 35 states. Presently, KR sports a favorable Zacks Rank #1 (Strong Buy).
Image Source: Zacks Investment Research
Kroger shares aren’t expensive by any means, with the company’s 10.8X forward earnings multiple sitting nicely beneath the 12.4X five-year median and the Zacks Retail and Wholesale sector average.
KR carries a Style Score of “B” for Value.
Image Source: Zacks Investment Research
Like IBKR, Kroger rewards its shareholders handsomely; the company’s annual dividend presently yields 2.2%, well above the Zacks sector average of 1.1%.
Impressively, Kroger has displayed a commitment to increasingly rewarding its shareholders, boasting a sizable 15% five-year annualized dividend growth rate.
Image Source: Zacks Investment Research
Cisco Systems
Cisco Systems is an IP-based networking company offering products and services to service providers, companies, commercial users, and individuals. Analysts have taken a bullish stance on the company’s earnings outlook, landing it into a Zacks Rank #2 (Buy).
Image Source: Zacks Investment Research
The market took the company’s latest earnings release in stride, sending shares on an upward trajectory post-earnings. Cisco exceeded the Zacks Consensus EPS Estimate by roughly 2.3% and reported revenue modestly above expectations.
Image Source: Zacks Investment Research
CSCO shares provide exposure to technology paired with a passive income stream; Cisco’s dividend currently yields 3% annually, more than triple that of the Zacks Computer and Technology sector average.
Image Source: Zacks Investment Research
Bottom Line
With CPI looming, investors may want to visit low-beta stocks as a shield against volatility. As we all know by now, CPI days have become quite a market-moving event.
All three low-beta stocks above – Interactive Brokers (IBKR - Free Report) , The Kroger Co. (KR - Free Report) , and Cisco Systems (CSCO - Free Report) – could be considerations for those looking for a shield against volatility.
All three sport improved earnings outlooks, indicating favorable near-term business outlooks.