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10 of the Best Stocks to Buy for 2019

The 10 best stocks to buy for 2019.

The stock market is now more than 10 years into a Federal Reserve-fueled bull run, despite the return of volatility in late 2018 as tariffs and rising interest rates took center stage. While the trade war still concerns Wall Street, the specter of rising rates quickly disappeared. The best stocks to buy for 2019 are strong companies with solid underlying fundamentals, poised to prosper regardless of what the future brings. A diverse array of growth and value stocks, ranging from small- to mega-cap names, all 10 of the best stocks to buy for 2019 look like attractive opportunities for the long-term investor. Here’s a rundown of the top selections.

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 998 net new stores between Q1 2018 and Q1 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. After a 20% rally in the first four months of 2019 shares aren’t the bargain they used to be, though Starbucks remains a great company built for the long term.

Year-to-date return (through May 15): 22%

NXP Semiconductors (NXPI)

For years, NXPI was more or less dead money. Not anymore. After the Chinese government failed to approve Qualcomm’s (QCOM) acquisition of the large-cap chipmaker, known for its leadership in the automotive and internet of things markets, shareholders got decimated. NXPI stock plunged from 2018 highs around $125 to lows beneath $68 in December. So what makes NXP Semiconductors one of the best stocks to buy for 2019? Well, it decidedly found its bottom, and even after 35% year-to-date gains through mid-May, shares go for 11 times forward earnings. The $2 billion breakup penalty QCOM paid was brilliantly invested by management, who approved aggressive buybacks at depleted prices.

YTD return: 37%

Facebook (FB)

When 2019 began, Facebook wasn’t the most popular stock pick; 2018 had been a nightmare for public relations. But when companies boasting more than 2 billion monthly active users are beaten down, you’re almost always wise to buy. FB’s network is impossible for competitors to copy without Facebook noticing from afar, at which point it can acquire the upstart rival or decimate it through imitation, as it did to Snap (SNAP) with Facebook Stories. With ownership of other billion-user apps Instagram, Messenger and WhatsApp — plus monetization opportunities in online dating and Facebook Marketplace — FB still looks like one of the best stocks to buy for 2019 despite 40% year-to-date gains.

YTD return: 39%

Stitch Fix (SFIX)

Like Netflix (NFLX), Stitch Fix harnesses user data to roll out new products under its own brand, a great long-term growth opportunity. This innovative young online retailer combines megatrends of e-commerce, bespoke services, subscriptions, big data and the stay-at-home economy, offering personal stylists that send you regular clothing installments based on your stated preferences. While shares have been volatile since its 2017 IPO, analysts expect revenue growth above 20% in 2019 and 2020, and SFIX stock is up dramatically through mid-May. Growth investors should strongly consider buying in on any material dips. Its recent expansion into big-and-tall clothing and practically zero long-term debt also boost its attractiveness.

YTD return: 43%

Johnson & Johnson (JNJ)

It never hurts to have a tried-and-true, battle-tested blue-chip behemoth in your portfolio for protection. Johnson & Johnson’s three multibillion-dollar divisions (pharmaceuticals, consumer goods and medical devices) make JNJ a broadly diversified cash cow. The main reason JNJ is one of the best stocks to buy for 2019 and beyond is its ability to weather the business cycle. Pharmaceuticals is both the largest and fastest-growing segment, accounting for more than 50% of revenue. Growing sales of its patented immunology drug Stelara and oncology drugs Imbruvica and Darzalex won’t suddenly stop in a downturn. Brands like Band-Aid, Tylenol and Imodium seem near-immortal to boot — and that’s just the tip of the iceberg.

YTD return: 6%

Berkshire Hathaway (BRK.B, BRK.A)

It’s regrettable that Warren Buffett and Charlie Munger can’t run this legendary holding company forever, but the two old sages have done the next best thing: Berkshire Hathaway is one of the few businesses that can practically run on cruise control for the next century. BRK has carefully but aggressively amassed a stable of “high-moat,” entrenched businesses in insurance, railroads, utilities and aerospace. A recent sweetheart deal to help fund Occidental Petroleum’s (OXY) buyout of Anadarko Petroleum (APC) deploys $10 billion of capital in exchange for preferred Occidental shares yielding 8% annually, plus warrants that could appreciate significantly. Berkshire’s often the only company that can secure such lucrative deals.

YTD return: 2%

Centene Corporation (CNC)

The $22 billion health insurer Centene, which has positioned itself as a niche operator focused on government-backed areas like Medicaid, was a beneficiary of the 2018 midterm elections, which made repealing the Affordable Care Act even less likely. ACA’s Medicaid expansion requirements help drive CNC membership growth, which clocked in at 14% in Q1. Despite first-quarter revenue growth of 40%, CNC has underperformed recently. Its deal to acquire WellCare Health Plans (WCG), expected to close in 2020, has also pressured shares, as is typical for an acquiring company. Centene still looks like one of the best stocks to buy for 2019 at just 11 times forward earnings.

YTD return: -5%

Apple (AAPL)

Apple’s most recent earnings report saw something long-term shareholders aren’t used to: a revenue decline. Despite sales falling 5%, both revenue and earnings beat expectations and when combined with strong guidance, a dividend hike and an additional $75 billion approved for stock buybacks, investors were pleased. An extended trade war with China and a recent Supreme Court ruling allowing a class-action lawsuit over the App Store’s monopoly power to proceed are both overhangs for shares, so conservative investors might wait for another late-2018-like pullback to load up. That said, AAPL has performed well since being named one of the best stocks to buy for 2019.

YTD return: 25%

Sprouts Farmers Market Inc. (SFM)

A lovely combination of value, growth, and predictability, Sprouts Farmers Market is a grocery chain focused on healthy, fresh and organic food. This $2.7 billion company is on the right side of the trend toward more conscious consumption, with 322 stores (and growing) in 19 states through May 2019. In an industry of typically unimpressive growth, SFM more than doubled revenue from $2.44 billion to $5.21 billion between 2013 and 2018. Private label sales, a great source of margin expansion for grocers, grew from 7% to 13% of sales between 2013 and 2018. Revenue grew 10% in Q1, and delivery in over 200 stores shows SFM’s nice growth potential.

YTD return: -4%

DowDuPont (DWDP)

“Money is made by discounting the obvious and betting on the unexpected.” This phrase best encapsulates the logic behind DWDP’s inclusion among 2019’s best stocks to buy. A Dow Jones laggard in 2018, DWDP is a contrarian pick based on its spin into three separate businesses that should unlock value for shareholders of the original DWDP. The Dow (DOW) (materials science) spin-off already happened, with the final spin creating DuPont (specialty products) and Corteva (agricultural seeds, weed killers). DWDP targeted synergies of $3.6 billion and repurchased $3 billion of stock before the April Dow spin-off; Corteva’s follows on June 1. This pick is ideal for sophisticated, contrarian investors.

YTD return: -12%

The best stocks to buy for 2019.

— Starbucks Corporation (SBUX)

— NXP Semiconductors (NXPI)

— Facebook (FB)

— Stitch Fix (SFIX)

— Johnson & Johnson (JNJ)

— Berkshire Hathaway (BRK.B, BRK.A)

— Centene Corporation (CNC)

— Apple (AAPL)

— Sprouts Farmers Market (SFM)

— DowDuPont (DWDP)

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10 of the Best Stocks to Buy for 2019 originally appeared on usnews.com

Update 05/15/19: This article was first published Nov. 14, 2018, and has been updated with current information.