3 stock picks for conservative investors – News Couple

3 stock picks for conservative investors

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These 3 high-quality stocks are perfect for conservative investors

When it comes to investing, putting your capital at risk is inevitable. That is why it is very important to consider your personal levels of risk tolerance before making any moves in the stock market. While high-growth and momentum stocks can certainly look attractive on the surface due to their height, the truth is that these types of investments are not suitable for all market participants. Sometimes it’s more attractive to focus on stocks that are less volatile and can provide consistent returns over the long term, especially if you’re an investor who’s sensitive during market dips.
This is part of what makes the stock market so unique, as there is something for everyone thanks to the many different options for exploring investment opportunities. If you’re a conservative investor looking for some solid stock picks to follow at this time, keep reading below for 3 interesting possibilities.

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Focusing on blue-chip companies with stock prices that are steadily trending upwards is a good way for conservative investors, and Home Depot certainly fits the bill. As the world’s largest home improvement retailer, this company has been profitable throughout the pandemic due to the strength in the housing market and how people are investing more in do-it-yourself projects. The company offers a diverse range of building materials, home improvement products, lawn and garden products, decorative products, and facility maintenance products along with home improvement installation services and tools and equipment rentals. Home Depot’s trusted brand name attracts both DIY and professional clients, driving long-term profit growth and helping the company beat EPS estimates in each of the past five quarters.
What’s also great about this stock is how fully committed Home Depot management is to returning capital to shareholders. The company has returned nearly $56 billion to its shareholders through dividends and stock buybacks over the past five years, which is certainly the kind of consistency that conservative investors are looking for. It’s also worth noting that while supply chain issues pose a risk to many retailers, Home Depot has taken matters into its own hands by chartering its own vessels to help maintain stock for its stores. Although the stock has rallied significantly in 2021 and is up nearly 40% since the start of the year, it’s a great candidate to buy on the dip for conservative investors looking to capitalize on the company’s long-term growth.

Coca-Cola is probably a company most people already know, as it is the world’s largest producer of soft drinks and juice-related products. It’s a great choice for conservative investors for several reasons. The fact that the stock has a beta of 0.66 means that in theory it is less volatile than the market. That tells us that Coca-Cola stock will typically move slower than the market averages, which is certainly attractive during periods of market downturn as we saw in September. This inventory is also a great option because it is a consumer goods company that is viewed as acyclic, meaning that its products will generate consistent sales no matter what is happening in the economy.
While Coca-Cola has been dealing with some of the disruption caused by the pandemic, the company’s business has been picking up nicely as people head to restaurants, stadiums and other public places to enjoy the company’s products once again. Third-quarter unit case volumes exceeded 2019 levels for the first time since the pandemic began, and the company reported third-quarter EPS growth of 41% to $0.57 in net revenue growth of 16% year-over-year. It’s also worth noting that the stock offers a 3% dividend yield and is a dividend aristocrat, which is definitely attractive to conservative investors who want a steady income.

Just because you’re a conservative investor doesn’t mean you can’t add exposure to high-growth technology stocks. Alphabet stands out as a solid choice thanks to its solid business model and incredibly consistent earnings performance. The world’s largest online search provider and largest source of online advertising revenue has outperformed its combined EPS estimates in each of the past six quarters, which is impressive given how high expectations are for the company. Most recently, Alphabet reported third-quarter EPS growth of 71% on revenue growth of 41%, which is astonishing when you consider the size of the company.
The addition of Alphabet stock essentially means having the most powerful player in digital advertising, an industry that seems unstoppable as technology becomes increasingly intertwined in our daily lives. Advertising spending has been skyrocketing after the pandemic, evidenced by the fact that Alphabet reported third-quarter ad revenue of $53.1 billion, up 43% year over year. There are also a lot of things investors can like about the company’s Google Cloud business, which could be a powerful engine for long-term growth as many companies move to the cloud. While there are some regulatory risks that conservative investors should be aware of with Alphabet, it is difficult to find many other negatives of this technology giant.

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