Stagflation Definition: 11 Best Stagflation Stocks To Buy

Oleh Admin 01 Jan, 2024 Posting Komentar

In this article, we'll talk about the 11 best stagflation stocks to buy now. If you want to see more stocks in this pick, check out the 5 Best Stocks to Buy in Stagflation.

Stagflation is characterized by persistently high inflation rates, simultaneously high unemployment rates and slowing demand. Initially considered an unknown concept, economists began to recognize the reality of stagflation after the "Great Inflation" of the 1970s. This phenomenon shows that, contrary to expectations that unemployment and inflation move in opposite directions, inflation has a negative impact on the economy. Daniel Dossena, chief investment officer at Blue Chip Partners, describes Stagefshan as:

“Tackling inflation is difficult from a policy perspective, because counter-inflationary measures (e.g., raising interest rates, reducing the money supply) can exacerbate unemployment and slow the economy even further. Paying for stocks.

Until recently, there were Wall Street experts who viewed Wall Street inflation as the main risk to the global economy in 2023. They believed that any recovery in stock markets in 2022 would be sustainable. GDP growth in the first quarter of 2023 eased inflation concerns in the US with the latest estimate of GDP growth in the third quarter of 2023, later revised to 1.1%. To 5.2% in the third quarter of 2023, which is the fastest growth rate since the fourth quarter of 2021.

Stagflation benefits defense companies - those that provide products and services essential to people's daily needs. As a result, the stock prices of these companies often show resilience even during recessions in macroeconomic conditions. Quantitatively, defensive sectors often have a market beta of less than 1, indicating outperformance when the benchmark index declines. On the other hand, cyclical sectors have a market beta greater than 1, which indicates poor performance when the index declines. Defensive sectors that have performed well in a stable economy include utilities, energy, consumer goods, healthcare, and real estate. On the other hand, cyclical sectors such as technology, industrial and financial sectors may face difficulties in such economic conditions. However, some stocks, including Costco Wholesale Corp. (NASDAQ: COST), Walmart Inc. (NYSE: WMT) and Berkshire Hathaway. (NYSE:BRK-B), is safer than others during times of high inflation.

Our way

When selecting the best stagflation stocks to buy, we choose stocks with defensive characteristics, strong market visibility, an incredible earnings profile, and long-term movement in a volatile market environment. Our rankings are based on hedge fund sentiment from Insider Monkey's comprehensive database, which tracks 910 elite hedge funds as of the end of Q3 2023. The consensus top 10 hedge funds outperformed the S&P 500 by more than 140 percent. In the past ten years ( see details here ) . That's why we pay attention to an indicator that is often overlooked.

11. General Mills

Number of hedge fund owners: 39

General Mills Corporation (NYSE: GIS) is a large American multinational corporation that manufactures and markets branded packaged consumer foods that are widely distributed through retail channels. The company has roots in Minneapolis, along the Mississippi River, St.

On September 21, RBC Capital General Mills, Inc. The target price has been changed. (NYSE:GIS), fell from $78 to $76 per share, maintaining its sector perform rating. In a research note, the company said first-quarter results were relatively mild, as challenges in the pet segment offset strong performances in the food service and international segments. In addition, the company is a subsidiary of General Mills, Inc. (NYSE:GIS), estimates organic net sales growth of 3 percent and EPS growth of 4 percent for FY24.

At the end of the third quarter of 2023, 39 hedge fund investors increased their investments in General Mills, Inc. They appointed. (NYSE:GIS), according to the Insider Monkey database. General Mills is the largest stakeholder. (NYSE:GIS) is a Millennium Management Company that owns about 1.6 million shares worth $102.8 million.

Costco Wholesale Inc. (NASDAQ: COST), Walmart Inc. (NYSE: WMT) and Berkshire Hathaway. (NYSE: BRK-B), General Mills. (NYSE:GIS) ranks as one of the best companies to buy recessionary inflation stocks.

10. Colgate-Palmolive (NYSE:CL)

Number of hedge fund owners: 52

Colgate-Palmolive Corporation (NYSE:CL) is a multinational corporation headquartered on Park Avenue in Midtown Manhattan, New York City. The company is engaged in manufacturing, distributing and supplying various household, healthcare, personal care and veterinary products.

On September 13, the company declared a quarterly dividend of $0.48 per share, which was consistent with the previous dividend. Colgate-Palmolive ( NYSE:CL ) is one of the best stagflation stocks and has continued its 61-year dividend growth streak. As of December 20, the stock's dividend yield was 2.46%.

According to Insider Monkey's Q3 2023 database, 52 out of 910 hedge funds disclosed own Colgate-Palmolive (NYSE:CL). The largest shareholder is First Eagle Investment Management, which owns 11 million shares of Colgate-Palmolive Company (NYSE:CL) for a total value of $783.12 million.

9. The Coca-Cola Company (NYSE: KO)

Number of hedge fund owners: 57

Founded in 1892, The Coca-Cola Company (NYSE: KO) is an American multinational corporation known for producing the famous Coca-Cola beverage. In addition to its distinguished products, the company is actively engaged in the production, distribution and sale of various refreshing concentrates, juices and especially alcoholic beverages.

In the first half of FY23, the company recorded strong financial performance, generating cash flow of US$4.6 billion while free cash flow reached US$4 billion. This underscores Coca-Cola's (NYSE:KO) strong earnings potential and positions it well to meet future shareholder obligations.

At the end of the third quarter, 57 of the 910 hedge funds tracked by Insider Monkey held positions in the company. Note that Warren Buffett is the largest investor in Coca-Cola (NYSE:KO), with a stake of $22.39 billion.

Baca Juga

8. CVS Health Company (NYSE: CVS)

Number of hedge fund owners: 64

Headquartered in the United States, CVS Health Corporation (NYSE:CVS) is a leading healthcare company with a national network of retail pharmacies and clinics. The company operates various brands, including CVS Pharmacy (a retail pharmacy chain), CVS Caremark (a pharmacy benefits manager) and Aetna (a health insurance provider).

In the third quarter, CVS (NYSE:CVS) reported revenue of $89.76 billion, an increase of approximately 11% compared to the same period last year. The company recorded net income of $2.27 billion, or $1.75 per share, during the quarter. That represents a sharp change from a loss of $3.40 billion, or $2.59 per share, in the same period last year.

At the end of the third quarter of 2023, InsiderMonkey, a database that tracks 910 hedge funds, found that 64 hedge funds held positions in CVS Health Corporation (NYSE:CVS). Notably, two Sigma Advisers, led by John Overdijk and David Siegel, have emerged as lead investors with a $344.87 million stake in the company.

The Coho Partners Relative Value Equity Fund made the following comments about CVS Health Corporation (NYSE:CVS) in its Q2 2023 investor letter.

“In December 2017, CVS Health Corporation (NYSE:CVS) agreed to acquire Athena, expanding its offerings by entering the managed care business. CVS is moving its portfolio toward a more value-based revenue model, and Aetna was an important step in This trend. We're poised to benefit from the deal because CVS has an excellent cash generation model and we expect free cash flow to get the company off the ground fairly quickly.
In mid-2022, CVS could use the free cash flow allocated to pay down debt to undertake additional deals and/or provide additional cash to shareholders through increased dividends or stock repurchases to better prepare for a value-based revenue model. However, CVS lost a "star" in its larger Medicare plan in 2022, which will hurt 2024 earnings. It was surprising and disappointing to us, but management should be able to find the "star" after a year. two. It will be halfway through 2023, which will make the company more profitable in 2025. (Click here to read the full text)

7. PepsiCo

Number of hedge fund owners: 65

By purchase, Harrison, New York, PepsiCo, Inc. (NASDAQ:PEP) is America's leading global food, snack and beverage company. The beverage giant, known for its financial stability, has maintained a pattern of consistent earnings growth for 51 years. The company currently offers a quarterly dividend of $1,265 as of December 20, with a dividend yield of 3.03%.

According to Insider Monkey, PepsiCo, Inc. (NASDAQ:PEP) had 65 hedge funds in its portfolio at the end of the third quarter of 2023. One of its largest investors is Fundsmith LLP, which owns 6.63 million shares on the New York Stock Exchange. The beverage maker is worth $1.12 billion. Over the past five years, the company's stock has risen significantly by about 45.2 percent.

(NASDAQ: PEP) Costco Wholesale Corporation. (NASDAQ: COST), Walmart Inc. It is consistently ranked between (NYSE:WMT) and Berkshire Hathaway Inc. (NYSE:BRK-B) is one of the inflation-linked stocks to buy.

6. Costco Wholesale Company (NASDAQ: COST)

Number of hedge fund owners: 65

Costco Wholesale Corporation (NASDAQ: COST) operates a global network of warehouses, most of which operate under the "Costco Wholesale" banner. The company offers high-quality, brand-name products at prices significantly lower than traditional wholesale or retail outlets. On December 21, the company declared a quarterly dividend of $15.0, representing a dividend yield of 0.61%. Costco Wholesale Corporation (NASDAQ: COST) has demonstrated its commitment to rewarding shareholders by delivering consistent earnings growth over the past 19 years.

According to data from Insider Monkey, there were 65 hedge funds buying Costco Wholesale Corporation (NASDAQ: COST) at the end of the third quarter of 2023, compared to 67 funds in the previous quarter. Bridgewater Associates, led by Ray Dalio, is one of the company's largest shareholders, owning 828,184 shares worth more than $467.8 million.

Riverpark Advisors mentioned Costco Wholesale Corporation (NASDAQ:COST) in its Q2 2023 investor letter. The company has:

Founded in 1983, Costco Wholesale Corporation (NASDAQ: COST) is the world's third-largest retailer, with 850 stores in North America, Europe, Asia and the South Pacific, $240 billion in revenue and 68 million members. The company is known for its strong value approach that Tracked and based on high-quality, low-cost offerings, including well-known private brands. Costco regularly ranks high in customer surveys for brand trust, product value and quality, and overall experience. Historically, 90% of business buyers renew their membership, making Generates more than 50% of operating income.
By expanding market share, opening new stores, increasing member productivity and expanding omnichannel, we believe the company will grow its revenue by a high single-digit percentage each year. This revenue growth results in consistent earnings and EPS growth in the low to mid range, resulting in stock returns in the same range.

Click to read and see the 5 best stocks to buy during stagflation.