3 Stocks That Could Help You Retire Even in a Bear Market

3 Stocks That Could Help You Retire Even in a Bear Market

September’s inflation report came back hotter than expected, increasing the likelihood of aggressive interest rate increases later in the year. Analysts expect the economy will tip into a recession next years. Dividend-paying stocks Walmart, Coca-Cola, and Greif (GEF) are backed by solid fundamentals and could help you plan your retirement, even in a bearish market. Read more

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The Federal Reserve has undertaken a series of interest rate hikes in an effort to control the surging inflation. Inflation rose 0.4% in September and 8.2% in comparison to a year ago, despite the rate hikes. The report initially rattled financial markets, with stock market futures plunging and Treasury yields increasing.

The latest GDP estimate showed that the U.S. economy contracted in the first half of this year. JPMorgan Chase & Co. (JPM) Chief Executive Officer Jamie Dimon cautioned about the possibility of a recession, as persistent and elevated inflation could cause interest rates to rise higher than 4.5%.

The S&P 500 has slid more than 20% this year, signaling a bear market. However, there might still be opportunities left for long-term investors, as bear markets usually don’t continue for long.

Given this backdrop, fundamentally strong dividend stocks Walmart Inc. (WMT), The Coca-Cola Company (KO), and Greif, Inc. (GEF) could be solid investments to ensure a stable income stream.

Walmart Inc. (WMT)

WMT engages in the operation of retail, wholesale, and other units worldwide. The company operates in three segments: Walmart U.S., Walmart International, and Sam’s Club.

On October 3, WMT’s division Sam’s Club launched its expanded Photo and Customization Services, where its members are granted access to professional photographers, enhanced photo printing services, as well as made-to-order apparel and home goods, making Sam’s Club the first to do so in the warehouse space.

On September 28, WMT celebrated the grand opening of Walmart’s first of four Next Generation Fulfillment Centers in Joliet, Illinois. The new FC will increase the company’s operational capacity and could drive up its revenue.

In February, WMT declared an annual dividend of $2. 24 per share to be paid in four quarterly installments of $0. 56 per share. Its annual dividend yields are 1. 69% on prevailing prices. Over the past three to five years, the company’s dividend payouts increased at a 1.9% annual rate. The company has a record of 48 years of consecutive dividend growth.

WMT’s total revenues came in at $152. 86 billion for the second quarter that ended July 31, 2022, up 8.4% year-over-year. Its consolidated net income was $5. 15 billion, up 17.9% year-over-year, while its EPS stood at $1. 88, up 23.7% year-over-year.

The consensus EPS estimate of $1. 48 for the fiscal fourth quarter ending April 2023 represents a 14.1% improvement year-over-year. The consensus revenue estimate of $144. 64 billion for the same quarter indicates a 3.1% increase from the prior-year period. The company’s earnings surprise history is impressive, exceeding the consensus EPS estimates in three quarters.

Over the past three months, the stock has gained 5.5% to close the last trading session at $132.28.

WMT’s POWR Ratings reflect this promising outlook. Our proprietary rating system rates the company as a Strong Buy. The POWR Ratings assess stocks by 118 different factors, each with its own weighting.

It has an A grade for Sentiment and a B for Growth, Stability, and Quality. It is ranked #6 out of 38 stocks in the A-rated Grocery/Big Box Retailers industry.

To see the additional POWR Ratings for WMT for Value and Momentum, click here.

The Coca-Cola Company (KO)

Beverage company KO manufactures, markets, and sells various non-alcoholic beverages worldwide. The company offers sparkling soft drinks, flavored water, enhanced water, juice, dairy- and plant-based beverages as well as tea and coffee.

On September 29, KO and Molson Coors Beverage Company (TAP) announced that they had entered into an exclusive agreement to develop and commercialize Topo Chico Spirited, a line of spirit-based, ready-to-drink cocktails. This new product launch could boost the company’s revenue stream.

On July 21, KO declared a quarterly dividend of 44 cents per common share, which was payable to shareholders on October 3. Its annual dividend is $1. 76 yields 3. 15% on prevailing prices. The company’s dividend payouts have grown at a 3.1% CAGR in the last three years and 3.6% in the past five years. The company has a record of 59 years of consecutive dividend growth.

KO’s net operating revenue increased 11.8% year-over-year to $11. 33 billion in the second quarter that ended July 1. Its non-GAAP gross profit grew 7.2% from the year-ago value to $6. 67 billion, while its non-GAAP net income improved 4.4% year-over-year to $3. 06 billion. The company’s non-GAAP net earnings per common share increased 2.9% from its year-ago value to $0.70.

Street expects KO’s revenue to increase 8.9% year-over-year to $42. 09 billion in the fiscal year 2022. Its EPS is expected to increase 5.9% year-overyear to $2. 46 in the same year. It has exceeded EPS estimates in all four quarters, which is quite impressive.

KO’s shares have gained 2.5% over the past five days to close the last trading session at $55.87.

KO’s overall B rating equates to a Buy in our proprietary rating system. Stock has a B rating for Stability, Sentiment and Quality. It’s ranked #17 out of 35 stocks in the A-rated Beverages industry.

Click here to get the KO ratings for Growth, Value, and Momentum.

Greif, Inc. (GEF)

GEF is a global producer of industrial packaging products and services. The company operates in three segments: Global Industrial Packaging, Paper Packaging & Services, and Land Management.

On August 30, GEF declared quarterly cash dividends of $0. 50 per share on its Class A common stock and $0. 75 per share on its Class B common stock, which was payable on October 1, 2022. Its annual dividend is $2. 00 yields 3. 37% on prevailing prices. Dividend payouts have increased by 2.2% CAGR over three years and 2.3% CAGR over five years.

For the fiscal third quarter that ended July 31, 2022, GEF’s net sales increased 8.8% year-over-year to $1. 62 billion. The company’s operating profit increased 18.8% year-over-year to $205. 70 million. Also, its net income rose 23.4% year-over-year to $146. 10 million, while its class A common stock EPS grew 24.9% from its prior-year quarter to $2.36.

For the fiscal year ending October 2022, GEF’s EPS and revenue are expected to increase 43.2% and 16% year-over-year to $8. 02 and $6. 45 billion, respectively. It has exceeded the consensus EPS estimates for each quarter.

The stock has declined 1.4% over the past five days to close the last trading session at $59.34.

GEF’s POWR Ratings reflect this promising outlook. According to our proprietary rating system, the stock has an overall rating A. This means that it is a Strong Buy. It also holds a B-grade for Quality and Value. Within the A-rated Industrial – Packaging industry, it is ranked #3 out of 22 stocks.

Beyond what we’ve stated above, we have also given GEF grades for Growth, Momentum, Stability, and Sentiment. Get all GEF ratings here.

WMT shares were trading at $130. 77 per share on Friday afternoon, down $1. 51 (-1.14%). WMT has fallen to -8 year-to-date. 54%, versus a -23. 65% rise in the benchmark S&P 500 index during the same period.

About the Author: Kritika Sarmah

Her interest in risky instruments and passion for writing made Kritika an analyst and financial journalist. She has a bachelor’s degree from commerce and is currently studying for the CFA program. With her fundamental approach, she aims to help investors identify untapped investment opportunities.


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