In this article, we’ll take a look at 13 safer stocks to invest in. To skip to our detailed analysis of the current recession concerns in the US and more, you can head straight to 5 safe stocks to invest in.
The Federal Reserve’s July interest rate hike of 25 basis points on July 26 has brought down inflation in the US from 5.25% to 5.5%. This is the highest inflation level in the US in 22 years, leaving markets and investors worried about what lies ahead. As fears of a market downturn remain, many investors are worried about their portfolios and are rushing to invest their money in what are known as “safe stocks”, i.e. stocks that will perform well regardless of overall market conditions. manage to stay in the green. Ideal.
What to focus on after rate hike?
While traditionally, sectors that have managed to do well in cold market conditions include sectors like consumer staples, utilities, and healthcare, another trend we’re seeing this year is primarily large-cap stocks like Microsoft. There is an ongoing tech rally led by tech companies. Corporation (NASDAQ:MSFT), Amazon.com, Inc. (NASDAQ:AMZN), and Alphabet Inc. (NASDAQ:GOOG). There are many reasons for this growth, one of which is the widespread popularity of artificial intelligence. With this in mind, investors should rest assured that although inflation is still running high, they are not suffering from a shortage of safe-haven stocks, which continue to struggle in a challenging financial environment.
Stock performance in these sectors also isn’t the only thing to rely on at the moment. Following the Fed’s decision to raise interest rates once again, Federal Reserve Chairman Jerome Powell also stated at the following press conference that the Fed would do everything in its power to bring inflation down again. Here are some of the comments Powell made at this press conference:
“We’re certainly very focused on rates and our policy. We’re going to use our policy tools to get inflation under control. The implication is, you know, we’re going to get inflation down.” Will do whatever we have to do. In theory, this could mean we have to do more if financial conditions become loose. But what happens is that financial conditions come and go with what we’re doing. And eventually over time, we get where we need to go.”
Fed’s commitment to reduce inflation
In a statement at the beginning of this press conference, Powell said that the Fed remains committed to its long-term goal of getting inflation down to 2%. Although he did not make a definitive statement on whether the market should expect further rate hikes this year, he noted that US policymakers will take a “meeting by meeting” approach to raising interest rates further. Overall, Powell’s statement and the following press conference suggest that while inflation is not expected to ease anytime soon, the Fed is doing its best to bring it back to more optimistic levels.
In the meantime, investors are advised to focus their savings on safer options, such as high-risk, low-volatility stocks that have consistently performed well over the past few years. These include several large-cap companies that made our list below and especially tech companies that have become more defensive investment options in 2023 in light of the continued tech rally. The below names can be considered as being safe stocks to buy especially for the beginners, and they are certainly some of the top low risk stocks to buy in the market this year. As such, our list below can serve as a helpful guide for beginner investors looking for some of the hottest stablecoins today.
13 safe stocks to invest
We have selected stocks from sectors such as consumer goods, health care and technology as these sectors have proven to be safe historically and in 2023. They are ranked from lowest to highest number based on the number of hedge funds that hold holdings. Using first quarter hedge fund data from Insider Monkey.
safe stocks to invest
13. The Hershey Company (NYSE:HSY)
Number of hedge fund holders: 44
Shares of The Hershey Company (NYSE:HSY) were upgraded from Neutral to Outperform by Max Gumport, an analyst at AXEN BNP Paribas, on July 19. The analyst also announced a price target of $268 on the stock.
The Hershey Company (NYSE:HSY) is a consumer staples company engaged in the manufacture and sale of confectionery products and pantry items internationally. The company is based in Hershey, Pennsylvania.
There were 44 hedge funds holding a total of $1.9 billion in The Hershey Company (NYSE:HSY) in the first quarter.
Microsoft Corporation (NASDAQ:MSFT), Amazon.com, Inc. (NASDAQ:AMZN), and Alphabet Inc. (NASDAQ:GOOG), The Hershey Company (NYSE:HSY) is a pretty safe stock that many hedge funds are hoarding. this year.
12. The Coca-Cola Company (NYSE:KO)
Number of hedge fund holders: 61
The Coca-Cola Company (NYSE:KO) is a beverage company operating in the consumer staples sector. It sells non-alcoholic beverages under the Coca-Cola, Fanta Orange and Diet Coke brands. It is located in Atlanta, Georgia.
The Overweight rating on shares of The Coca-Cola Company (NYSE:KO) was reiterated by Morgan Stanley analyst Dara Mohsenian on July 27. The analyst also maintained a $70 price target on the stock.
The Coca-Cola Company (NYSE:KO) was tracked by 13F holdings of 61 hedge funds at the end of the first quarter. His total stake in the company was valued at $27.5 billion.
11. Home Depot, Inc. (NYSE: HD)
Number of hedge fund holders: 65
At the end of the first quarter, Ballard Inc. owned The Home Depot, Inc. (NYSE:HD) had the most shares, with 79,348 shares.
As of July 26, Chris Grazia, an analyst with Argus Research, said The Home Depot, Inc. (NYSE:HD) maintains a buy rating on the stock. Graza also has a price target of $350 on the shares.
Home Depot, Inc. (NYSE:HD) is a home improvement retail company based in Atlanta, Georgia. It sells building materials, home improvement products, lawn and garden products, and more.
Our hedge fund data shows that in the first quarter Home Depot, Inc. (NYSE:HD) is held by 65 hedge funds with a total holding value of $2.1 billion.
In its Second Quarter 2023 Investor Letter, Madison Investments announced The Home Depot, Inc. (NYSE:HD) made the following comments regarding:
“The Home Depot, Inc. (NYSE:HD) is celebrating 30 years of giving back. Team Depot was founded in 1993 as a way to organize associates who were eager to volunteer in their communities. For 30 years, Team Depot associates have worked side by side with nonprofits across the United States. Focus areas include spending time with the elderly and activities with at-risk youth. Team Depot also improves the homes and lives of veterans and helps communities affected by natural disasters.
During the quarter, Home Depot targeted battery-powered products to represent more than 85% of outdoor lawn equipment sales in the US and Canada by the end of fiscal 2028. Push lawn mowers and handheld leaf blowers and trimmers will run on rechargeable battery technology instead of gas. This will reduce greenhouse gas emissions by 2 million metric tons annually.
10. PepsiCo, Inc. (NASDAQ:PEP)
Number of hedge fund holders: 70
PepsiCo, Inc. (NASDAQ:PEP) was viewed in the portfolios of 70 hedge funds at the end of the first quarter. His total stake in the company was valued at $4 billion.
PepsiCo, Inc. (NASDAQ:PEP) is another consumer products company on our list that markets and sells beverages and convenience foods internationally. It is located in Purchase, New York.
As of July 14, John Staszak of Argus Research has PepsiCo, Inc. (NASDAQ:PEP) maintains a buy rating on the stock. The analyst has also raised his price target on the stock from $193 to $195.
9. Procter & Gamble Company (NYSE:PG)
Number of hedge fund holders: 75
The Procter & Gamble Company (NYSE:PG) is a provider of branded consumer packaged goods in the consumer staples sector. It offers hair care products, personal care products and more. The company is based in Cincinnati, Ohio.
A total of 75 hedge funds held stakes in Procter & Gamble Company (NYSE:PG) during the first quarter, with a total holding value of $4.7 billion.
Morgan Stanley analyst Dara Mohsenian reiterated an overweight rating on shares of Procter & Gamble Company (NYSE:PG) on July 25 with a price target of $174.
Ballard Inc. was the largest shareholder in The Procter & Gamble Company (NYSE:PG) at the end of the first quarter, holding 151,031 shares in the company.
8. Merck & Company, Inc. (NYSE: MRK)
Number of hedge fund holders: 75
As of July 20, Robin Karnauskas, an analyst at Truist Securities, said Merck & Co., Inc. (NYSE:MRK) maintains a buy rating on the stock. The analyst has also set a price target of $116 for the stock.
We closed 75 hedge fund longs on Merck & Co., Inc. at the end of the first quarter. (NYSE:MRK), whose total holding was valued at $3.7 billion.
Merck & Company, Inc. (NYSE:MRK) is a pharmaceutical company with international operations. It operates through its Pharmaceutical and Animal Health sectors. The company is based in Rahway, New Jersey.
In its 2023 Second Quarter Investor Letter, Barron Funds announced Merck & Company, Inc. (NYSE:MRK) said the following about:
“During the second quarter, Merck & Company, Inc. (NYSE:MRK) filed the first lawsuit against the federal government (followed by additional lawsuits filed by other parties) challenging the constitutionality of the Medicare Drug Price Negotiation Program (the Program) that Congress enacted as part of the Inflation Reduction Act. was established in In Merck’s complaint, Merck argues that the program violates the Fifth Amendment because it allows the federal government to take away Merck’s innovative drugs without providing proper compensation for them. Furthermore, Merck argues that the program violates the First Amendment because it forces them to sign an agreement stating that the prices set by the government are reasonable and the result of a negotiation, when, in fact, Merck argues, the prices are not negotiable or fair. It will take time for these lawsuits to work their way through the legal process and in the meantime, the program continues on its prescribed path. The unanimous opinion is that these lawsuits will not be successful, and the program will remain in place. We suspect that Merck’s arguments may convince at least some US Supreme Court justices when the case reaches the US Supreme Court, but the final outcome is impossible to predict. For now, we assume the program will remain in place and will invest with that framework in mind.
7. Johnson & Johnson (NYSE:JNJ)
Number of hedge fund holders: 86
Ballard Inc. was the largest shareholder in Johnson & Johnson (NYSE:JNJ) at the end of the first quarter, holding 133,081 shares in the company.
Johnson & Johnson (NYSE:JNJ) is another healthcare company on our list. It is located in New Brunswick, New Jersey. The company researches, develops, manufactures and sells a variety of health care and pharmaceutical products, including skin health and beauty products.
The Outperform rating on shares of Johnson & Johnson (NYSE:JNJ) was maintained by Raymond James analyst Jason Bedford on July 24. The analyst also raised his price target on the stock from $181 to $184.
Overall, 86 hedge funds were long Johnson & Johnson (NYSE:JNJ) in the first quarter. His total stake in the company was valued at $4.5 billion.
6. Walmart Inc. (NYSE:WMT)
Number of hedge fund holders: 91
Walmart Inc. (NYSE:WMT) is a retail and wholesale company operating in the consumer staples sector. It manages supercentres, supermarkets, hypermarkets, warehouse clubs, cash and carry stores and discount stores. The company is based in Bentonville, Arkansas.
Piper Sandler analyst Edward Yaruma upgraded shares of Johnson & Johnson (NYSE:JNJ) from neutral to overweight on July 25. The analyst also announced a price target of $210 on the stock.
In the first quarter, 91 hedge funds held Walmart Inc. (NYSE:WMT), with a total stake value of $5.7 billion.
Microsoft Corporation (NASDAQ:MSFT), Amazon.com, Inc. (NASDAQ:AMZN), and Alphabet Inc. (NASDAQ:GOOG), Walmart Inc. (NYSE:WMT) is one stock that’s highly popular among elite hedge funds. Today.
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Disclosure: None. 13 safe stocks to invest Originally published on Insider Monkey.