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Top-Ranked Stocks Suitable for Millennials: 6 Picks

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Millennials, also known as Gen Y, are the demographic cohort falling between the effervescent Gen X and the digitalized Gen Z. Millennials are rapidly outpacing the baby boomers and makes up around 25% of the U.S. population.

Currently there are 79.4 million millennials, compared with 75.5 million baby boomers. As per CNBC, immigration could lead millennial population to jump to 81 million by 2036.

Per the new guidelines of Pew Research Center, millennials are classified those whose birth years range between 1981 and 1996. Per this classification, the oldest millennial is 37 years while the youngest is 22, which makes this generation highly susceptible to economic downturn.

A look at the investment pattern of the millennial generation reveals that this group has a more conservative stance. With age on their side, they have a long-time horizon for investment. This allows them to take risks and focus more on capital appreciation rather than dividend income. Thanks to growing market volatility and uncertainty related to investment returns, millennials prefer to play it safe.

Financial Goals

Notably, millennials remain confident about their spending decisions. A survey conducted by Charles Schwab reveals that 81% of millennial responders were optimistic about their spending.

As per CNBC,millennials save more than 36% of their annual salaries compared with preceding generations.Further, millennials are closing the gap between personal and societal well-being. Per Morgan Stanley report, approximately 84% of millennials have started investing with the major focus being on ESG (Environmental, Social and Governance).

For years, millennials were plagued by higher student loan debt, sluggish wages and poor job prospects as the result of the “Great Recession.” However, currently, millennials are the most educated generation among other cohorts. As per CNBC report, around 39% of the millennial population holds at least a bachelor’s degree.

Consequently, better education makes millennials aware of the socio-economic scenario of the country, which in turn is beneficial for both individual and the economy. Moreover, it helps the generation to improve the quality of life by insuring their own financial security.

Growth in Millennial Population

A survey report from TD Ameritrade shows that 43% of respondents considering socially responsible investments are by millennials compared with 33%, 25% and 18% by Generation X, Baby Boomers and mature investors, respectively. This is due to the fact that many millennials put more of an emphasis on environmental benefits and human rights.

As this section of the population has chances of making up 75% of the workforce by 2025, businesses that are likely to benefit from their habits could offer solid returns. Per research by Global X, millennials now earn about $2 trillion, with a projected $8 trillion by 2025. Millennials’ spending is likewise expected to rise to $1.4 trillion annually and account for 30% of total retail sales by 2020, according to Accenture.

Gone are those days when millennials were considered dependent on parents and unlikely to have surplus cash to invest in the stock market. This demography is significant part of the U.S. population and their stock purchase behavior has considerable impact on the market.

6 Top Picks

However, it is difficult to pick the right stocks for millennials from a wide range of available investment opportunities. This is where our Style Score System and Zacks Stock Screener comes into play.

Our Growth Style Score condenses all the essential metrics from the company’s financial statements to achieve a true sense of quality and sustainability of its growth. Our research shows that stocks with Growth Style Scores of A or B when combined with a Zacks Rank #1 (Strong Buy) or 2 (Buy) offer the best investment opportunities in the growth investing space. You can see the complete list of today’s Zacks #1 Rank stocks here.

Our Picks

Keysight Technologies (KEYS - Free Report) sports a Zacks Rank #1 and a Growth Score of A. The stock has returned 54.4% on a year-to-date basis. Further, the company has a long-term expected EPS growth rate of 10%.

The estimates for both 2019 and 2020 for the company have improved 6.4% and 5.3%, respectively, over the last 60 days.

Anixter International flaunts a Zacks Rank #1 and a Growth Score of B. The stock has returned 10.7% on a year-to-date basis. Further, the company has a long-term expected EPS growth rate of 8%.

The estimates for both 2019 and 2020 for the company have improved 12.3% and 9.7%, respectively, over the last 60 days.

Cirrus Logic (CRUS - Free Report) has a Zacks Rank #1 and a Growth Score of B. The stock has returned 60.4% on a year-to-date basis. Further, the company has a long-term expected EPS growth rate of 15%.

The estimates for both 2020 and 2021 for the company have improved 25.6% and 15.5%, respectively, over the last 60 days.

Symantec Corporation  has a Zacks Rank #2 and a Growth Score of A. The stock has surged 23.4% on a year-to-date basis. Further, the company has a long-term expected EPS growth rate of 6.9%.

The estimates for both 2020 and 2021 for the company have improved 4.2% and 2.8%, respectively, over the last 60 days.

Microsoft (MSFT - Free Report) has a Zacks Rank #2 and a Growth Score of A. The stock has appreciated 35.3% on a year-to-date basis. Further, the company has a long-term expected EPS growth rate of 11%.

The estimates for both 2020 and 2021 for the company have improved 2.4% and 2.3%, respectively, over the last 60 days.

Alphabet (GOOGL - Free Report) has a Zacks Rank #2 and Growth Score of B. The stock has returned 13.1% on a year-to-date basis. Further, the company has a long-term expected EPS growth rate of 17.5%.

The estimates for both 2019 and 2020 for the company have improved 8% and 2.8%, respectively, over the last 60 days.

Alphabet Inc. Price and Consensus

 

Alphabet Inc. Price and Consensus

Alphabet Inc. price-consensus-chart | Alphabet Inc. Quote

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