Investors entered 2019 fraught with uncertainty. In recent months the concern about the trade war with China and disappearing gains on the stock market have yielded just a few options for savvy investors.
Some companies have robust business models and are still well positioned for growth, regardless of what happens in the global economy.
Here are seven of the best stocks to buy for the rest of 2019.
Starbucks Corporation (ticker: SBUX)
While the running gag with Starbucks is there’s “one on every corner,” that punchline still rings hollow in some parts of the globe. The company’s biggest growth driver is still the China/Asia Pacific region, where it opened 994 net new stores between June 30, 2018 and June 30, 2019. Hedge fund titan Bill Ackman certainly believes SBUX is one of the best stocks to buy for 2019, with well over $1 billion invested through his fund. Although shares aren’t the bargain they used to be after a 51% year-to-date rally, Starbucks remains a great company built for the long term.
Target Corp (ticker: TGT)
While the terms “Target” and “robust business model” might not bubble into consciousness simultaneously, perhaps they should. The big-box retailer is coming off a blockbuster second quarter in which online sales jumped 34%, earnings per share advanced 20%, and management raised full-year EPS forecasts. Back in 2017, the company committed $7 billion to investing in store remodels, same-day order fulfillment and e-commerce in order to compete against Walmart (WMT) and Amazon.com (AMZN) properly. It wasn’t until second-quarter 2019 results came in that this long-term strategy was proven a success, but it emphatically was, and shares jumped by 20% in one day. TGT pays a 2.5% dividend, even after the rally.
Johnson and Johnson (ticker: JNJ)
Tired of seeing Johnson & Johnson mentioned as one of the best blue-chip stocks to buy? Well it turns out novelty is not a byproduct of blue-chip investing. JNJ doesn’t offer anything fancy; sales growth has come in essentially flat in 2019, and the company expects between 4% and 6% EPS growth this year. Still, Johnson & Johnson has been considered a reliable blue-chip stock for over a century, and if it weren’t for a stronger dollar, sales would be rising in the mid-single digits internationally right now. JNJ shares offer a 2.9% dividend, and the company’s pharmaceutical division should support the long-term health of the underlying business.
McDonald’s Corp (ticker: MCD)
How can anyone compete with the dollar menu when the economy is struggling? One of the strongest blue-chip stocks to buy for the rest of 2019 has to be McDonald’s, which boasts one of the world’s most profitable brands and efficient fast-food operations. In 2008, MCD shares outperformed the S&P 500 by 47 percentage points as operating income advanced by 17%. More recently, CEO Steve Easterbrook has proven a brilliant executive, with shares soaring over 140% since assuming the reins in March 2015. His moves included adding an all-day breakfast menu, investing heavily in digitizing the business, and a recent strategy of “refranchising,” selling corporate-owned stores to franchisees to lower cost structures and boost long-term margins.
Cronos Group (ticker: CRON)
The fortunes of Cronos Group have changed dramatically in the last year, as Altria Group (MO), which owns Philip Morris USA and makes Marlboro and Virginia Slims, bought a 45 percent stake of CRON for $1.8 billion.
Although that’s not a negligible equity concession, the benefits of partnering with a blue-chip tobacco giant like Altria – especially at this early stage of the game – could be litany.
Altria also aggressively bid to acquire a 30 percent chunk of the vaping leader Juul in 2018, giving Cronos an interesting cross-pollination opportunity (if you will) down the road. Shares of this cannabis market leader trade on the Nasdaq.
This stock provides a great way to get involved with the rapidly growing cannabis industry.
GP Solutions (ticker: GWPD)
GP Solutions has developed the world’s most innovative transportable, indoor farms, which can be set up quickly virtually anywhere to grow a variety of vegetable, herbs and crops. Called GrowPods, these automated systems allow businesses, entrepreneurs, restaurateurs, grocery stores, schools and organizations to grow fresh, healthy food on-site that is free from disease and dangerous chemicals.
GrowPods are scaleable. Want a bigger farm? Just stack another GrowPod. The units are climate controlled and keep pests out so there is no need for pesticides.
GrowPods start out as fully insulated, food-grade shipping containers that have been specifically modified to provide the optimum controlled environment for growing a wide range of horticultural and agricultural products in all environments and climates. With a combination of hydroponic and certified organic soil systems; yields are significantly faster and more consistent than other means of farming.
The company has also licensed its technology to Micro Lab Farms for exclusive use in the cannabis industry. These specially tuned systems allow licensed cannabis growers to cultivate their crops quickly, with a much smaller investment than buying land or investing in greenhouses or converting a warehouse to a grow facility. Plus GrowPods are automated, which makes it easy to grow robust crops and obtain a fast ROI on investment.
GP Solutions is much smaller than the other companies on this list. But with that comes opportunity for investors looking for a stock that has the potential for rapid growth.
First Solar (ticker: FSLR)
Perhaps the greatest challenge for solar panel manufacturers is that technology changes so rapidly that companies are constantly spending on research and development and investing in retooling manufacturing facilities for the latest innovation in panel technology or manufacturing. It’s capital intensive, and the relatively low margins and cyclical nature of the solar industry make it incredibly challenging for companies to generate returns.
First Solar may have to run in the same rat race as the rest of the solar industry, but it has one thing that few others have: a huge cash pile to invest. At the end of the most recent quarter, First Solar had more than $2 billion in net cash on the balance sheet. This cash pile helps in two big ways: It gives the company the freedom to invest in new technology developments and expanding capacity without having to rely on external capital, and it generates a modest income from the interest earned on its short-term investments.
With a market cap of over $6 billion and flexibility to invest through the ups and downs of the turbulent solar market, this could be a stock with a sunny return.
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