This could be a great time to invest in the stock market. A coronavirus vaccine appears to be on the horizon. Gridlock in DC tends to be favorable for the stock market.
Gridlock also means that interest rates will likely remain at zero for even longer. The POWR Ratings can help you identify the best stocks to pick.
Here is a quick look at four “Strong Buy” stocks that should continue to ascend in the year ahead: Alibaba Group Holding (BABA), Procter & Gamble (PG), Qualcomm (QCOM), and Texas Instruments (TXN).
Alibaba Group Holding (BABA)
BABA is China’s e-commerce powerhouse. This company is broadening its horizons to cloud computing and even delivery services. Small, Taobao, and Alibaba.com comprise BABA’s primary businesses.
It is quite possible upwards of three-quarters of all web-based sales in China will be handled by BABA within the next couple of years. In other words, it is hard to see this fast-growing e-commerce superstar falling from grace. If you are hesitant to hop on the BABA train, look no further than its POWR Rating components. BABA has "A" grades in the Industry Rank, Peer Grade, Trade Grade, and Buy & Hold Grade components. BABA is ranked first of 115 China stocks.
Of the 24 analysts who have studied this stock, every single one of them recommends it as a “Buy”. BABA has a surprisingly reasonable forward P/E ratio of 32.72. The stock is moving toward its 52-week high of $319.32 established about a month ago. China will likely exceed the United States' GDP at some point in the next decade, a trend that will help BABA achieve new heights.
BABA will clearly benefit from the rapid growth of China's middle class, a group that will likely embrace consumerism all the more in the years ahead. Add in the fact that BABA's cloud services business has provided quarterly revenue hikes of 60% on a year-over-year basis and you have even more reason to scoop up this stock.
Note that BABA is one of 5 stocks in the Reitmeister Total Return portfolio. Learn more here.
Procter & Gamble (PG)
PG will likely be rated as a “Strong Buy” next year, a half-decade into the future, and possibly across posterity. The stock performs well during economic booms and also during recessions as it sells the essentials ranging from deodorant to shampoo and paper products.
Take a look at PG's POWR Ratings and you will find "A" grades in the Buy & Hold, Trade, Peer, and Industry Rank components. PG is ranked first of 34 stocks in the Consumer Goods category. The average analyst price target for PG is $156.10, meaning the stock has 13.12% upside.
PG has an enticing forward P/E ratio of 25.83, meaning the stock might be slightly undervalued at $137.99. The bottom line is PG's brands ranging from Gillette to Puffs, Bounty, and Tide have staying power, meaning this is a solid long-term investment worthy of a position in your portfolio.
Qualcomm (QCOM)
QCOM makes and markets telecom products and services. These wireless products are powered by QCOM’s signature CDMA technology. QCOM has "A" grades in the Peer, Trade, and Buy & Hold POWR Rating components. The stock is ranked first of 86 in the Semiconductor & Wireless Chip category.
The average analyst price target for QCOM is $154.33, indicating the stock has around 8% upside. Out of 23 analysts who have studied the stock, 16 recommend it as a "Buy", seven consider it a "Hold" and none recommend selling. Add in the fact that QCOM has a fairly low forward P/E ratio of 21.50 and you have even more reason to consider investing in it.
Ride the 5G wave with QCOM through 2021 and you should emerge with a profit.
Texas Instruments (TXN)
Most people know TXN makes TI calculators for students yet this tech company does much more than that. TXN also designs and builds semiconductors. This industry trailblazer in digital signal processing should be on your investing radar.
The POWR Ratings show TXN has "A" grades in the Buy & Hold and Trade Grade components. Furthermore, the stock has a "B" grade in the Industry Rank and Peer Grade components. Out of nearly 90 publicly traded companies in the Semiconductor & Wireless Chip category, TXN is ranked second.
The top analysts insist TXN’s price target is $160.55, meaning the stock has around a 3% upside. Furthermore, TXN has a forward P/E below 30 and has reinforced its commitment to returning the bulk of its free cash flow to investors by way of buybacks and dividends. TXN’s current dividend is 2.59%.Want More Great Investing Ideas?
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BABA shares fell $266.54 (-100.00%) in premarket trading Wednesday. Year-to-date, BABA has gained 24.00%, versus a 12.34% rise in the benchmark S&P 500 index during the same period.
About the Author: Patrick Ryan
Patrick Ryan has more than a dozen years of investing experience with a focus on information technology, consumer and entertainment sectors. In addition to working for StockNews, Patrick has also written for Wealth Authority and Fallon Wealth Management.
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