The Federal Reserve announced its third consecutive interest rate hike of 75 basis points yesterday. With the Fed officials voting unanimously to lift the benchmark federal-funds rate to…
a range between 3% and 3.25%, the central bank seems intent on fulfilling its mandate of maintaining low and stable prices while being prepared to risk a possible recession.
Since a soft landing for the economy increasingly seems like an improbable scenario, the market may not return to stability anytime soon. Amid this backdrop, the best stocks to buy may be those that have survived previous market routs and emerged as winners.
To that end, it could be wise to invest in fundamentally solid and time-tested stocks UnitedHealth Group Incorporated (UNH), Johnson & Johnson (JNJ), and The Coca-Cola Company (KO).
UnitedHealth Group Incorporated (UNH)
UNH is a diversified healthcare company. The company operates through four segments: Optum Health; OptumInsight; OptumRx; and UnitedHealthcare. It offers consumer-oriented health benefit plans and services, software and information products, health care coverage, and well-being services. Additionally, UNH provides access to networks of care provider specialists, consumer engagement, and financial services.
On September 21, UNH and Peloton Interactive Inc. (PTON) renewed and expanded their relationship to extend subscription and preferred pricing benefits to the commercial member. This engagement is set to provide additional value to UNH’s customers, which would further secure its client base.
On September 7, UNH and Walmart Inc. (WMT) announced the beginning of a 10-year wide-ranging collaboration. Optum, a UNH subsidiary, would provide proven clinical abilities to assist select Walmart Health locations and improve people’s health outcomes by advancing value-based care. The collaboration is expected to expand further to include additional products and services over time.
For the fiscal 2022 second quarter ended June 30, 2022, UNH’s revenues increased 12.6% year-over-year to $80.33 billion. The company’s earnings from operations rose 19.3% from the year-ago value to $7.13 billion. In addition, its net earnings and adjusted earnings per share attributable to UNH common shareholders came in at $5.20 billion and $5.57, up 18.9% and 18.5% year-over-year, respectively.
Analysts expect UNH’s revenue for the fiscal year 2022 (ending December 2022) to come in at $322.20 billion, indicating a 12% rise from the last year. Also, Street expects the company’s EPS for the current year to grow 14.8% year-over-year to $21.84. The company has been able to exceed the consensus EPS estimates in each of the trailing five fiscals.
UNH’s shares have gained 24.2% over the past year to close the last trading session at $512.08.
UNH’s POWR Ratings reflect its fundamental strength. The stock has an overall rating of A, which translates to a Strong Buy in our proprietary rating system. The POWR Ratings assess stocks by 118 different factors, each with its own weighting.
UNH has a B grade for Sentiment, Quality, Growth, and Stability. In the A-rated Medical – Health Insurance industry, it is ranked #4 of 11 stocks.
Beyond what we’ve stated above, we have also given UNH grades for Value and Momentum. Get all UNH ratings here.
Johnson & Johnson (JNJ)
JNJ is a worldwide researcher, developer, manufacturer, and seller of various healthcare products. The company operates through three segments: Consumer Health; Pharmaceuticals; and MedTech.
On September 15, JNJ announced that its Board of Directors had authorized the repurchase of up to $5 billion of its common stock. The repurchases may be made at management’s discretion on the open market or through…
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