4 Stocks to Buy in Any Market Climate The stock market is expected to remain volatile in the near term as investors remain anxious about the Fed's actions. Amid high recession worries, fundamentally strong healthcare stocks, Pfizer (PFE),...
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The stock market is expected to remain volatile in the near term as investors remain anxious about the Fed's actions. Amid high recession worries, fundamentally strong healthcare stocks, Pfizer (PFE), Bristol-Myers Squibb (BMY), Amgen (AMGN), and Elevance Health (ELV), which have the potential to withstand any market downturns, could be ideal investments now. Read more.
The stock market remains volatile ahead of Fed chair Jerome Powell's Semiannual Monetary Policy Report delivery to Congress. Moreover, as recessionary fears are high, quality healthcare stocks Pfizer Inc. (PFE), Bristol-Myers Squibb Company (BMY), Amgen Inc. (AMGN), and Elevance Health Inc. (ELV) could be wise additions to your portfolio.
Healthcare stocks tend to perform relatively well despite market downturns, as companies in this space enjoy inelastic demand for their products and services.
This week, the market is particularly focused on Powell's comments on interest rates and the Federal Reserve's ongoing efforts to combat inflation one year after implementing its forceful monetary policy plan.
Moreover, investors have been tracking moves in the bond market for short-term direction in the stock market.
Ross Mayfield, an investment strategy analyst at Baird Private Wealth Management, said, "This is kind of how the market traded last year. It seems we're back on that path now that the Fed's terminal rate and what the Fed is going to do is back in the forefront."
Larry Summers, former Treasury Secretary, recently cautioned that while the U.S. economy is currently performing well and maintaining momentum, there is still a considerable danger of it unexpectedly plunging into a recession.
Let's discuss the stocks mentioned above:
Pfizer Inc. (PFE)
PFE discovers, develops, manufactures, distributes, and sells biopharmaceutical products worldwide. It offers medicines and vaccines in various therapeutic areas. The company serves wholesalers, retailers, hospitals, clinics, government agencies, and disease control and prevention centers.
On February 22, PFE announced that the U.S. Food and Drug Administration (FDA) had granted Priority Review for the company's Biologics License Application (BLA) for elranatamab, an investigational B-cell maturation antigen (BCMA) CD3-targeted bispecific antibody (BsAb), for the treatment of patients with relapsed or refractory multiple myeloma (RRMM).
Chris Boshoff, M.D., Ph.D., Chief Development Officer, Oncology and Rare Disease, PFE Global Product Development, said, "We believe that elranatamab, if approved, has the potential to become the next standard of care for multiple myeloma given its favorable clinical results and convenient subcutaneous route of administration."
PFE has a record of raising dividends for 12 consecutive years. It pays a dividend of $1.64 per share annually, translating to a yield of 3.99% at the current price. Its 4-year average dividend yield is 3.64%. The company's dividend payouts have increased at a 5.2% CAGR over the past three years.
PFE's revenues came in at $24.29 billion for the fourth quarter that ended December 2022, up 1.9% year-over-year. Its income from continuing operations increased 39.7% year-over-year to $5 billion.
Also, its non-GAAP adjusted net income attributable to PFE common shareholders came in at $6.55 billion, up 44.2% year-over-year. Its non-GAAP adjusted EPS increased 44.3% year-over-year to $1.14.
PFE's revenue is expected to increase by 1.1% year-over-year to $70.31 billion in the fiscal year 2024. Its EPS is expected to grow 13% year-over-year to $3.91 in the same year. It surpassed EPS estimates in all four trailing quarters, which is impressive.
PFE's shares lost marginally intraday to close the last trading session at $41.11.
PFE's POWR Ratings reflect this promising outlook. The stock has an overall rating of B, equating to a Buy in our proprietary rating system. The POWR Ratings assess stocks by 118 different factors, each with its own weighting.
PFE has an A grade for Value and a B for Quality. Within the Medical – Pharmaceuticals industry, it is ranked #23 out of 167 stocks.
Click here for the additional POWR Ratings for Stability, Sentiment, Growth, and Momentum for PFE.
Bristol-Myers Squibb Company (BMY)
BMY discovers, develops, licenses, manufactures, markets, distributes, and sells biopharmaceutical products worldwide. It offers products for hematology, oncology, cardiovascular, immunology, fibrotic, and neuroscience diseases.
On March 2, BMY, in collaboration with Janssen Pharmaceuticals, Inc. of Johnson and Johnson (JNJ), announced the launch of the Phase 3 Librexia program studying milvexian, an investigational oral factor XIa (FXIa) inhibitor (antithrombotic).
Roland Chen, M.D., senior vice president and head, Cardiovascular Development, Global Drug Development of the company, said, "BMY and Janssen bring deep heritage and expertise in cardiovascular care to this program, in partnership with renowned experts, and we look forward to continuing to evaluate the potential of milvexian to address key unmet medical needs for patients living with thrombotic diseases."
On March 3, BMY declared a quarterly dividend of 57 cents ($0.57) per share on the company's $0.10 par value common stock, payable on May 1, 2023.
BMY has paid dividends for six consecutive years. Its dividend payouts have increased at 9.2% CAGR over the past three years. Its current dividend yield is 3.29%. Its four-year average yield is 3.02%.
BMY's total in-line products U.S. revenues came in at $5.27 billion for the fourth quarter that ended December 31, 2022, up 11.7% year-over-year. Its U.S. total revenues increased 5.4% year-over-year to $7.92 billion.
Also, its total expenses decreased 5.7% year-over-year to $9.55 billion, while its non-GAAP EPS stood at $1.82. Non-GAAP net earnings attributable to BMY stood at $3.87 billion.
Analysts expect BMY's revenue to increase 1.8% year-over-year to $46.99 billion in the current fiscal year 2023. Its EPS is estimated to rise 4.3% year-over-year to $8.03 in the same year. It surpassed EPS estimates in all four trailing quarters.
The stock declined marginally intraday to close the last trading session at $68.90.
BMY's robust prospect is reflected in its POWR Ratings. The stock has an overall A rating, which equates to a Strong Buy in our proprietary rating system.
In addition, it has an A grade for Value and a B for Growth, Stability, Sentiment, and Quality. BMY is ranked #2 in the Medical – Pharmaceuticals industry.
Access additional POWR Ratings for BMY (Momentum) here.
Amgen Inc. (AMGN)
AMGN discovers, develops, manufactures, and delivers human therapeutics worldwide. It focuses on inflammation, oncology/hematology, bone health, cardiovascular disease, nephrology, and neuroscience areas.
On February 2, AMGN and AstraZeneca PLC (AZN) announced that the U.S. Food and Drug Administration (FDA) had approved TEZSPIRE® (tezepelumab-ekko) for self-administration in a pre-filled, single-use pen for patients aged 12 years and older with severe asthma.
TEZSPIRE is the only biologic licensed for severe asthma that does not have any phenotypic or biomarker restrictions in its approved label.1. This should assist AMGN in meeting the unmet needs of asthma patients.
During the fourth quarter of fiscal 2022, AMGN's non-GAAP operating income increased marginally year-over-year to $3.01 billion. The company's non-GAAP net income came in at $2.20 billion. Also, its non-GAAP EPS came in at $4.09.
AMGN's revenue for the fiscal year 2023 is expected to increase 1.5% year-over-year to $26.71 billion. Its EPS is expected to increase marginally year-over-year to $17.84 in the same year. It has surpassed the consensus EPS estimates in three of the trailing four quarters.
The stock has gained marginally intraday to close the last trading session at $235.11.
AMGN's POWR Ratings reflect solid prospects. The stock has an overall rating of A, equating to a Strong Buy in our proprietary rating system.
It has an A grade for Quality and a B for Value and Stability. Within the 399-stock Biotech industry, it is ranked #7.
Beyond what is stated above, we've also rated AMGN for Growth, Momentum, and Sentiment. Get all AMGN ratings here.
Elevance Health Inc. (ELV)
ELV operates as a health benefits company. It serves approximately 118 million people through medical, digital, pharmacy, behavioral, clinical, and care solutions.
On February 15, ELV announced the closing of its acquisition of BioPlus, a comprehensive specialty pharmacy subsidiary of CarepathRx, a portfolio company of Nautic Partners. Biopus covers more than 100 limited distribution medications and has a footprint that touches all 50 states.
This acquisition will help EVS meet the specialty drug needs of its clients and customers with a whole-health approach supported by programs across its healthcare services brand.
ELV pays a $5.92 per share dividend annually, which translates to a 1.26% yield on current prices. Its dividend payouts have increased at a 17% CAGR over the past three years. The company has a record of 11 consecutive years of dividend growth.
During the fiscal fourth quarter that ended December 31, 2022, ELV's total operating revenue increased 9.2% year-over-year to $39.30 billion. Its premiums and product revenue rose 9.4% and 17.4% year-over-year to $33.65 billion and $4.14 billion, respectively.
In addition, the company's adjusted net income per share came in at $5.23, up 1.8% from the prior-year quarter.
Street expects ELV's EPS and revenue for the first quarter ending March 2023 to increase 13.1% and 8% year-over-year to $9.33 and $40.92 billion, respectively. Moreover, it has an impressive earnings history, as it surpassed the consensus EPS and revenue estimates in each of the trailing four quarters.
The stock gained marginally intraday, closing the last trading session at $472.84.
It is no surprise that ELV has an overall A rating, which translates to a Strong Buy in our proprietary rating system.
Also, it has a B grade for Value, Stability, and Quality. Among the ten stocks in the A-rated Medical – Health Insurance industry, ELV is ranked first.
We've also rated ELV for Growth, Momentum, and Sentiment. Get all ELV ratings here.
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PFE shares fell $0.06 (-0.15%) in premarket trading Tuesday. Year-to-date, PFE has declined -19.03%, versus a 5.76% rise in the benchmark S&P 500 index during the same period.
About the Author: Kritika Sarmah
Her interest in risky instruments and passion for writing made Kritika an analyst and financial journalist. She earned her bachelor's degree in commerce and is currently pursuing the CFA program. With her fundamental approach, she aims to help investors identify untapped investment opportunities.
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