These seven high-quality stocks have solid fundamentals.
Supply chain issues and inflation have hurt corporate profits in 2022, resulting in large-scale stock market declines. These daily changes in stocks are dizzying investors and causing a lot of uncertainty in the markets. But one of the best ways to weather this tough economic climate is to invest in quality companies. Investors can still be optimistic on some stock picks right now to keep their investments on the right track. This means looking out for companies that have strong financials, can manage debt effectively and have lasting capital. Here are seven stocks that could be held for the long term.
Walmart Inc. (ticker: WMT)
Walmart is a retail behemoth with thousands of stores in the U.S. and wide international reach. Despite the retail giant’s miss on its fiscal first-quarter 2023 earnings, Walmart has been reporting a steady growth in revenue on an annual basis. In 2022, Walmart recorded $572 billion in revenue, up from 2021’s $559 billion and 2020’s $542 billion. There is temporary pressure on the company’s profit margins due to higher costs associated with inflation, supply chain and increased wages, but the company is confident it can deliver profit growth in the future. Walmart also has a strong track record of sharing profits with shareholders. The stock carries a dividend yield of about 1.8% and increased its dividend for the 49th consecutive year in February. Walmart is also a strong contender in the battle for e-commerce. In its fiscal 2022 highlights, Walmart’s e-commerce business generated $73 billion in sales. Compared to competitors, Walmart has historically been able to keep expenses low while offering cheap goods to consumers. While Walmart is facing temporary headwinds, it has the ability to control expenses and increase margins over time.
Johnson & Johnson (JNJ)
Johnson & Johnson is one of the leading health care companies, serving more than 1 billion people every day. Despite the economic headwinds, JNJ recorded strong earnings in its latest quarterly report. It is an industry leader in pharmaceutical sales, which is its largest business segment. In the first quarter of 2022, JNJ reported $23.4 billion in sales across all segments, a 5% worldwide increase from the same time last year. JNJ sales and earnings have steadily increased over the past five years. In 2021, JNJ sales were $93.8 billion, after revenue of $82.6 billion and $82.1 billion for 2020 and 2019, respectively. The company anticipates its consumer health segment, which it plans to spin off, to have some supply chain constraints throughout the year but expects the second half of 2022 to outperform the first half. JNJ also sees strong operational sales growth in its pharmaceutical segment through the remainder of the year, along with continued momentum in medtech. JNJ also offers a competitive dividend of about 2.6% and paid $2.8 billion to shareholders in the first quarter of the year.
Coca-Cola Co. (KO)
Coca-Cola makes brands and products loved by consumers for many years. It also has been bucking the bearish trend and is up more than 5% this year through June 9. In the first quarter of 2022, Coca-Cola sales increased 11%, to $1.4 billion from last year’s $1.2 billion. Profits for the same quarter increased 13% year over year to $508 million, despite having to weather higher supply costs. Like Walmart, KO is also known as adividend aristocrat , or a stock that has raised dividends consecutively for at least 25 years. KO currently pays a competitive dividend of 2.8%. The company also is prioritizing sustainability. By 2039, Coca-Cola aims to have at least 25% of its volume, globally and across portfolio brands, sold in refillable glass or plastic bottles, which will help reduce its carbon footprint.
Amazon.com Inc. (AMZN)
Amazon.com takes the title of the world’s largest online retailer. Amazon is known for its speedy delivery service to customers. The company has expanded into several business channels and has seen massive growth over time. Amazon’s delivery network has expanded as its customer base continues to grow. By the end of 2021, Amazon had 253 fulfillment centers and 467 delivery stations in North America, plus many hundreds more globally. Amazon Prime, which offers delivery for orders to ship within a couple of days, has more than 200 million members. Shares of AMZN have risen along with the company’s growth. The 10-year stock gain of AMZN as of the end of 2021 was 1,826%. The online retail giant recently announced a 20-for-1stock split to make its stock shares more affordable for investors. So instead of buying one share of AMZN for more than $2,000, investors can buy in at little more than $100.
Verizon Communications Inc. (VZ)
Verizon is one of America’s leading wireless network operators. In 2021, the company generated $133.6 billion in revenue, up 4.1% year over year. Verizon plans to continue this momentum as demand for wireless products persists. Throughout 2022, the company expects revenues to grow as customers shift to higher-access plans that offer more services and as demand for higher-speed internet increases. Verizon forecasts business growth from further development of its 4G LTE network and the building out of its 5G network. Verizon has a vast ecosystem of strategic partnerships with Samsung, Amazon.com, Apple Inc. (AAPL), Alphabet Inc. (GOOG, GOOGL) and many others. Also, Verizon’s network will collaborate with Meta Platforms Inc. (META) to help enable themetaverse .
Costco Wholesale Corp. (COST)
Costco is one of the largest retailer chains in the world, providing a network of members with high-quality products at affordable prices. Despite the lingering challenges from the pandemic, Costco continues its strong record of increasing sales quarter over quarter. Sales for its fiscal third quarter came in at $51.6 billion, a 16.3% increase from the same time a year earlier. COST stock also carries a quarterly dividend of 90 cents per share after a recent increase. Costco has more than 830 warehouses and 116 million cardholders and continues to open new locations.
3M Co. (MMM)
3M has over 60,000 products in its portfolio that perform science-based functions in homes, schools, businesses, hospitals and other industries. While 3M has competition from companies like Honeywell International Inc. (HON) and General Electric Co. (GE), it has a history of delivering value to its consumers and shareholders. Since the start of 2022, the company has improved operating margins while investing for long-term growth in significant markets. In the first quarter, 3M returned $1.6 billion to shareholders through dividends and share repurchases, up 49% year over year.
7 best long-term stocks to buy now:
— Walmart Inc. (WMT)
— Johnson & Johnson (JNJ)
— Coca-Cola Co. (KO)
— Amazon.com Inc. (AMZN)
— Verizon Communications Inc. (VZ)
— Costco Wholesale Corp. (COST)
— 3M Co. (MMM)
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Update 06/10/22: This story was previously published at an earlier date and has been updated with new information.