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Altria & 4 Other Low-Beta Stocks to Fight Brexit Fears
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Volatility in the U.S. market seems to be on the rise of late. Speculations surrounding the Fed rate hike and volatile gasoline prices triggered by ‘critical’ gas supply have now been aggravated by the debate on ‘Brexit’ in the European Union.
‘Brexit’ Fears Spike Volatility
All eyes are on Jun 23 when Britain, under the leadership of President Cameron, will vote in a referendum on whether it wants to stay in the European Union. A British exit (Brexit) will start a long and complicated process resulting in a fundamental change in U.K.’s relationship with the other EU members. This is also expected to increase the cost of trade and services for Britain across international borders. For the world economy, the upcoming EU referendum has the potential to impact securities including stocks, ETFs and mutual funds which have a significant exposure to the U.K. A Brexit may be followed by a prolonged stretch of uncertainty that could dent growth and trigger losses in the global financial market.
Uncertainty over Fed Decision
Lower-than-expected U.S. non-farm payroll data was released in May and hence Fed is unlikely to raise rates at its meeting on June14-June 16. Moreover, Brexit fears are expected to influence the Fed to stall its rate hike decision until Jul 2016..
5 Safe Haven Consumer Staple Stocks
Amid such volatility, investors look for safe assets like gold and government bonds. However, we provide you with five low-beta consumer staple stocks to counter the prevailing market mayhem.
Such stocks have a beta of less than 0.55 suggesting that the price movement of the stock is not highly correlated with the market. Since they are less volatile than the market, they are safer bets at the moment. Moreover, we have picked stocks that are fundamentally sound and possess a Zacks Rank #1 (Strong Buy) or 2 (Buy) and have shown considerable price gain over the last 4 weeks.
Altria Group Inc.(MO - Free Report) : This Zacks Rank #2 company fares well in the style score system too, with a Growth score of A. The Marlboro maker has a beta score of 0.48 and is expected to grow 7.48% over the long term. Further, the stock had had a strong run last month, gaining around 2.35%. Over the past 30 days, analysts have become increasingly bullish on the company, with majority estimate revisions moving north for fiscal 2016 earnings.
The company reported better-than-expected results in the recently concluded first quarter of 2016. Altria’s top and bottom line improved year over year, backed by higher shipments and retail share gains by its flagship brand, Marlboro. Meanwhile, lower excise tax has helped the company report higher year over year profit during the period.
Reynolds American Inc.: This Zacks Rank #2 tobacco company carries a beta score of 0.39 and has gained around 0.6% last month. Over the past 60 days, most of the analysts have raised estimates for 2016 earnings. Reynolds also reported an increase in year-over-year earnings and sales in the first quarter of 2016, courtesy higher cigarette and moist snuff pricing. Further, Reynolds’ earnings are poised to grow 18.7% this year and 11.4% in the next.
The company’s impressive brand portfolio of tobacco products helps it to maintain strong business momentum and generate decent profits. Further, the company invests continuously in innovation and brand building which has helped it retain its leadership position in the industry.
Con Agra Foods Inc.(CAG - Free Report) : This Zacks Rank #2 stock has a beta score of 0.38 and has rallied around 2.44% in the last four weeks. Over the past 60 days, the estimates for the company’s 2016 earnings have been on the rise. Con Agra also reported better-than-expected results for third-quarter fiscal 2016. The company is reducing its debt burden and plans to fund its new capital deployment programs with the proceeds from the divestiture of the Private Brand.
McCormick & Company, Incorporated (MKC - Free Report) : This Zacks Rank #2 stock has a beta score of 0.52. Moreover, McCormick is expected to grow 7.10% in fiscal 2016 and 10.2% in the next fiscal. McCormick has been witnessing rising demand for spices, herbs and seasonings over the last few years, which is boosting sales. McCormick is also focusing on building sales through brand marketing investments and acquisitions. The company’s recent acquisitions are expected to boost revenues in the coming quarters.
The J. M. Smucker Company (SJM - Free Report) : This Zacks Rank #1 stock, with a beta of 0.53, has had a healthy run over the last 12 weeks, gaining around 12.37%. Over the last 60 days, analysts have become increasingly bullish on the company, with most of the estimates moving north for 2016 earnings following strong fourth quarter fiscal 2016 results announced on June 9, 2016. J.M Smucker posted earnings of $1.76 per share in the third quarter of fiscal 2016 which beat the consensus estimate and also increased 14% from the prior-year quarter owing to impressive growth in the top line and operating profits.
We believe these stocks can be valuable additions to investors’ portfolio.
You can use the Zacks Stock Screener to find other stocks with this winning combination. Investors can confidently end their search at stocks with a favorable Zacks Rank, which encompasses its strong fundamentals, promises price appreciation and highlights analysts’ constructive view on the same via positive estimate revisions.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days.Click to get this free report >>
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Altria & 4 Other Low-Beta Stocks to Fight Brexit Fears
Volatility in the U.S. market seems to be on the rise of late. Speculations surrounding the Fed rate hike and volatile gasoline prices triggered by ‘critical’ gas supply have now been aggravated by the debate on ‘Brexit’ in the European Union.
‘Brexit’ Fears Spike Volatility
All eyes are on Jun 23 when Britain, under the leadership of President Cameron, will vote in a referendum on whether it wants to stay in the European Union. A British exit (Brexit) will start a long and complicated process resulting in a fundamental change in U.K.’s relationship with the other EU members. This is also expected to increase the cost of trade and services for Britain across international borders. For the world economy, the upcoming EU referendum has the potential to impact securities including stocks, ETFs and mutual funds which have a significant exposure to the U.K. A Brexit may be followed by a prolonged stretch of uncertainty that could dent growth and trigger losses in the global financial market.
Uncertainty over Fed Decision
Lower-than-expected U.S. non-farm payroll data was released in May and hence Fed is unlikely to raise rates at its meeting on June14-June 16. Moreover, Brexit fears are expected to influence the Fed to stall its rate hike decision until Jul 2016..
5 Safe Haven Consumer Staple Stocks
Amid such volatility, investors look for safe assets like gold and government bonds. However, we provide you with five low-beta consumer staple stocks to counter the prevailing market mayhem.
Such stocks have a beta of less than 0.55 suggesting that the price movement of the stock is not highly correlated with the market. Since they are less volatile than the market, they are safer bets at the moment. Moreover, we have picked stocks that are fundamentally sound and possess a Zacks Rank #1 (Strong Buy) or 2 (Buy) and have shown considerable price gain over the last 4 weeks.
Altria Group Inc.(MO - Free Report) : This Zacks Rank #2 company fares well in the style score system too, with a Growth score of A. The Marlboro maker has a beta score of 0.48 and is expected to grow 7.48% over the long term. Further, the stock had had a strong run last month, gaining around 2.35%. Over the past 30 days, analysts have become increasingly bullish on the company, with majority estimate revisions moving north for fiscal 2016 earnings.
The company reported better-than-expected results in the recently concluded first quarter of 2016. Altria’s top and bottom line improved year over year, backed by higher shipments and retail share gains by its flagship brand, Marlboro. Meanwhile, lower excise tax has helped the company report higher year over year profit during the period.
Reynolds American Inc.: This Zacks Rank #2 tobacco company carries a beta score of 0.39 and has gained around 0.6% last month. Over the past 60 days, most of the analysts have raised estimates for 2016 earnings. Reynolds also reported an increase in year-over-year earnings and sales in the first quarter of 2016, courtesy higher cigarette and moist snuff pricing. Further, Reynolds’ earnings are poised to grow 18.7% this year and 11.4% in the next.
The company’s impressive brand portfolio of tobacco products helps it to maintain strong business momentum and generate decent profits. Further, the company invests continuously in innovation and brand building which has helped it retain its leadership position in the industry.
Con Agra Foods Inc.(CAG - Free Report) : This Zacks Rank #2 stock has a beta score of 0.38 and has rallied around 2.44% in the last four weeks. Over the past 60 days, the estimates for the company’s 2016 earnings have been on the rise. Con Agra also reported better-than-expected results for third-quarter fiscal 2016. The company is reducing its debt burden and plans to fund its new capital deployment programs with the proceeds from the divestiture of the Private Brand.
McCormick & Company, Incorporated (MKC - Free Report) : This Zacks Rank #2 stock has a beta score of 0.52. Moreover, McCormick is expected to grow 7.10% in fiscal 2016 and 10.2% in the next fiscal. McCormick has been witnessing rising demand for spices, herbs and seasonings over the last few years, which is boosting sales. McCormick is also focusing on building sales through brand marketing investments and acquisitions. The company’s recent acquisitions are expected to boost revenues in the coming quarters.
The J. M. Smucker Company (SJM - Free Report) : This Zacks Rank #1 stock, with a beta of 0.53, has had a healthy run over the last 12 weeks, gaining around 12.37%. Over the last 60 days, analysts have become increasingly bullish on the company, with most of the estimates moving north for 2016 earnings following strong fourth quarter fiscal 2016 results announced on June 9, 2016. J.M Smucker posted earnings of $1.76 per share in the third quarter of fiscal 2016 which beat the consensus estimate and also increased 14% from the prior-year quarter owing to impressive growth in the top line and operating profits.
Consumer Staples Sector Price Index
Consumer Staples Sector Price Index
Bottom Line
We believe these stocks can be valuable additions to investors’ portfolio.
You can use the Zacks Stock Screener to find other stocks with this winning combination. Investors can confidently end their search at stocks with a favorable Zacks Rank, which encompasses its strong fundamentals, promises price appreciation and highlights analysts’ constructive view on the same via positive estimate revisions.
Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days.Click to get this free report >>