The Top Stocks to Buy in 2020
The stock market enjoyed a great 2019. Certain industries, such as the technology sector, have done particularly well. Even a couple of former laggards, the likes of some big banks and such, are also started slowly roaring back. So, what are the top stocks you should be considering in 2020? There’s a lot that investors can look forward to.
While momentum can sometimes go for years and years, most of the time, the market, as the year rolls by, will switch its concentration from one particular area to another. It’s usually not that easy to predict the absolute best stocks for any year, however, this year might just prove a bit more challenging than the previous ones.
A good stock in 2020 will require robust growth prospects and a bit of durability as well. Getting a mixture of those two is considerably difficult to come by. Luckily, however, there happen to be very many companies out there that fit this bill.
Let’s take a closer look at what you should be considering in 2020. Who knows? Once you’ve spent time brushing up on forecasting and investment tips you may be the next Andreas Clenow.
With the market enjoying a relative amount of growth, many individual stocks look like they’ll be in the green. With that said, there are also very many that aren’t doing as well as you’d expect and ExxonMobil is one of the biggest in this bunch.
Nonetheless, they’re still not to be counted out this year. In fact, far from it. The biggest dog this year will hunt the most.
Why? The oil market looks like it’s close to a full turnaround since the oil prices crashed in 2019. That easy capital is finally no more in this sector. A lot of smaller E&P organizations have filed bankruptcy. The shale revolution is fast losing steam and there are no longer unlimited amounts of cheap oil readily available in the market.
On top of this, political rules and regulations are making it harder and harder to drill land for new oil resources. California, for instance, is experiencing the placement of huge new measures to limit fracking.
Although, while such things might be a major concern for the small firms in the industry, conglomerates like Exxon can expect major turnarounds regardless. It gets its oil from all over the world, and it’s bringing in brand new huge projects online from many different regions such as Guyana.
The bottom line, ExxonMobil is looking to double both their cash flow and earnings in the next 5 to 8 years or so. Given that they’re already among the most profitable companies in the world right now and pays out a generous dividend yield of 5%, any kind of huge growth is sure to send Exxon stock soaring.
For the income-focused investor, one of the most compelling stocks you can buy at a fair price is Unilever. Unilever is a huge assortment of personal hygiene brands and consumer foods. It includes name brands the likes of Axe, Degree, and Rexona antiperspirants, Hellman’s mayonnaise and Lipton tea.
A lot of these kinds of consumer staples have managed to trade up sharply. For instance, Proctor & Gamble and Hershey have both recorded gigantic gains during the past couple of years and they’re currently trading at about 25x earnings.
Unilever isn’t doing as great as those two but it isn’t doing too bad either. Unilever stocks are currently selling at around 20x earnings. This happens to be a substantial discount when compared to similar and like-minded peer companies.
This company is growing its revenues at over five percent annually, which is currently a very appetizing figure in the consumer staples sector. Its 3.1 percent dividends also stand out, especially since the company, most years, tends to hike the rates to high single-digits.
It’s quite unbelievable how relatively cheap Facebook stock remains. Every month that passes, the Cambridge Analytica scandal slowly continues to fade away into the horizon. Yet, the Facebook stock is still valued as though we should expect it to go through some huge business disruption in the near future.
That’s probably the only way you can explain why they’re still selling for around 21x earnings despite recording a similar growth earnings rate. Many experts kept predicting how regulatory complications would result in a gigantic drop-off in business for Facebook. However, nothing like that has happened. Not even a tiny bit.
Sure, their margins experienced a little downturn because of all they did to improve security on their platform, but their earnings are still increasing by over twenty percent annually, even when it was undergoing this major hiring period. Furthermore, revenues are still growing at almost thirty percent.
The entire cancel Facebook thing did not play out according to what most people thought it would, meanwhile the other properties Facebook owns, such as WhatsApp and Instagram, continue to rapidly rise in popularity.
The mainstay products from Hormel Foods such as ham and turkey are allowing this company to continue to thrive. With that said, there’s so much more to Hormel than just your traditional meat products. This company has now managed to become a leader in several more millennial-oriented products.
These include non-GMO and organic meats, Mexican salsa, ready-to-eat guacamole, and nut-butters. But, that’s not all. Hormel Foods recently made a huge leap into the plant-based protein market as well with its ground protein product called Happy Little Plants.
Jim Snee, the CEO of Hormel, insinuated that they considered purchasing one of their rival plant-based companies, but they found out it was way cheaper to just do it by themselves.
HRL is one of the stocks you should strongly consider in 2020 because of the attractive dividends it offers. You won’t be going wrong if you invest in some of this stock.
Investing in the Top Stocks
Even though this year could end being just as volatile as last year was, that doesn’t necessarily mean there aren’t any top stocks you can get your hands on. Some of the stocks we highlighted in this article have typical defensive characteristics the likes of high dividend yield and/or being recession-resistant businesses.
Now you know what you need to be looking at to build wealth in 2020. Check out our blog for more financial advice and tips to help you thrive this year.