There’s plenty to keep investors on the edge of their seats right now — the election, the economy and the pandemic, to name just a few.
But one thing that’s abundantly clear? Big-cap stocks are powering through all of it.
When the markets turn down, these stocks are the safe harbor investors turn to. And when the markets are bullish, these are the stocks that people go to for growth.
This pattern has played out most of this year and I would argue was in place for the latter part of 2019 as well.
These 7 hot stocks to buy with mega-cap status are perfect examples of diverse companies with unique stories that keep them at the top of their game, now and for years to come:
- Apple (NASDAQ:AAPL)
- Amazon (NASDAQ:AMZN)
- Alibaba (NYSE:BABA)
- Salesforce.com (NASDAQ:CRM)
- Nike (NYSE:NKE)
- Procter & Gamble (NYSE:PG)
- Johnson & Johnson (NYSE:JNJ)
Small stocks usually do well when the economy is rapidly expanding. But there are so many constraints and visibility is so opaque, it’s now a much smarter choice to invest in big stocks that can grow regardless of the economy’s path.
7 Hot Stocks To Buy: Apple (AAPL)
The uber-consumer electronics company released its fiscal Q4 earnings yesterday for the quarter ended September 30.
Many metrics were up significantly and the company beat both earnings and profits expectations. Yet the company sold off in afterhours trading.
Why? Because sales in China were down nearly 30% year-over-year.
Much of this could be pandemic-related consumer depression coupled with the fact most countries were dealing with import and export limitations during this period.
But the underlying concern is that China’s taste for U.S. phones may be waning as trade relations between the nations remain frosty.
However, there were a number of bright notes in the call, with tablet sales, Mac sales and services up significantly. Even China showed non-iPhone sales jumps.
AAPL, with a nearly $2 trillion market cap, is up 80% in the past year and its iPhone 12 launch should help keep the momentum going.
Amazon (AMZN)
If there was one obvious winner from the pandemic lockdown in March and beyond, it was AMZN. The online retail behemoth became the national default when social distancing shuttered stores and other businesses.
And the fact that it’s so well run, even during those high pressure times? That it managed to get those orders delivered in a timely fashion, even when demand skyrocketed? Well that’s reason enough to like the stock.
Yet the truly mindboggling part is that, for all the revenue that its retail business drives, its real profit powerhouse is Amazon Web Services (AWS). As the biggest cloud provider in the world, its margins power most of the other divisions, especially the constant flow of new ideas and acquisitions the company engages in.
Its $1.6 trillion market cap puts it in rarefied company, as does its 79% return in the past 12 months. And there’s plenty of opportunity left on the table.
Alibaba (BABA)
“The Amazon of China” is how most Westerners thumbnail this company. And while that’s very true it’s also much bigger in its ambitions simply due to the way the Chinese market is structured.
It runs wholesale and retail operations as well as search engine and cloud computing divisions. And its fintech spinoff Ant Financial is about to be the largest IPO in history.
BABA will have a 22% stake in Ant. It also just picked up 6% ownership in travel retailer Dufry (OTCMKTS:DUFRY).
And remember, China has about 5 times the amount of people as the U.S., and it’s the second-largest economy in the world. The company has been making inroads to India as well.
The U.S.-listed BABA has a market cap of $858 billion, but it also has a separate listing in China. The stock is up 77% in the past year and going strong.
Salesforce.com (CRM)
Customer relationship management (CRM) is an entire business sector that exists now because Salesforce.com built it.
CRM (the company) took the disparate parts of managing enterprise companies’ customer tracking, support, marketing and sales, and rolled them into one system.
That means all the necessary people across departments can see how and where a customer is on their journey and act appropriately. Fundamentally, it’s hyper-aware sales. And now that system is available on the cloud.
And CRM built the pioneering model system and continues to be the sector leader. In a consumer-driven country like the U.S., this is a big deal. And while CRM has its competitors, it’s a force beyond American shores as well. About 30% of company revenue comes from outside the Americas.
The stock has a $217 billion market cap but has been hit in the selloff this week. But CRM is still up 51% in the past 12 months.
Nike (NKE)
It’s hard to believe that this athletic apparel and footwear icon has been around for 56 years. And in the grand scheme of things, it didn’t take long for NKE to hit its stride (pardon the pun).
This company helped birth the running craze that took off in the 1970s and continues to this day. It was the leader in high-end basketball shoes that are now investment-grade assets in their own right.
And its swoosh is on clothing and swag all around the world, whether on professional athletes or casualwear enthusiasts. The point is, NKE has seen its share of competitors and outwitted them all to not only survive, but thrive and innovate.
The stock has sold off a bit in the recent decline this week, but it’s still up 37% over the past year, even with many retail operations slowed. Its $191 billion market cap is nearly 3 times larger than the nearest competitor, and this company has proven it can go the distance at a record pace.
Procter & Gamble (PG)
Did you know that Martin van Buren was the first U.S. president to be born a U.S. citizen? All previous presidents were technically born as British subjects.
Why am I bring this up? Because Procter & Gamble was started when van Buren became the eighth president of the United States.
That’s a long time be around — 183 years in fact. And these were times of huge booms and busts as well as famine, wars and other economic challenges. These were also the years where PG cut its teeth and built a business that could thrive in any condition that came its way.
It continues to manage its business with this kind of perspective. And after streamlining its massive product line a few years back, it’s in great shape to deal with the pandemic and the economic insecurity we’re living through right now.
PG isn’t a sexy tech stock, but it’s rock solid. And its $341 billion market cap makes it a dominant player, with almost no short positions against it. Plus, its 2.3% dividend has been raised every year for more than 50 years.
Johnson & Johnson (JNJ)
If you watch PBS, you might have seen the thank you at the beginning of a broadcast to the Robert Wood Johnson Foundation. Well, that foundation’s namesake, alongside his two brothers, started this Brunswick, New Jersey-based consumer health and healthcare company back in 1886.
Today, its reach is global. And beyond its line of iconic brands like Band-Aid, Neosporin, Neutrogena, Tylenol, Motrin, Benadryl and Listerine, it has built out a respected and lucrative pharmaceutical and healthcare division as well.
Its Janssen pharmaceutical division is well-placed when it comes to pathologies ranging from cardiovascular disease to diabetes. And it’s a big player in developing the new wave of drugs that help the human immune system fight diseases. JNJ even has a potential COVID-19 vaccine in the works.
The stock is up slightly this year and has a solid, generous 2.9% dividend. Its consumer and clinical divisions make it a unique play in both sectors.
— Louis Navellier and the InvestorPlace Research Staff
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Source: Investor Place