If history is any guide, the stock market is due for a major crash soon. Nothing goes up forever, after all. There’s no way to predict what the market’s going to do on any given day, but we asked three of our Motley Fool contributors which stocks they think are worth buying as part of a broader capital preservation strategy.
Here’s why they picked…
Built to last
George Budwell (Johnson & Johnson): If there’s any publicly traded company that knows how to weather a storm, it’s healthcare giant Johnson & Johnson. Incorporated in 1887, J&J has gone on to build a bonanza of world-class brands, including Band-Aid, Benadryl, Listerine, and Tylenol, among many, many others. And that’s just the company’s consumer healthcare segment. J&J also sports one of the most productive pharmaceutical pipelines in the world, as well as a top-notch medical device segment. The point is that J&J is an essential part of the global healthcare landscape, making it one of the safest stocks you can own.
J&J has been going through a series of enormous challenges over the past few months, such as the scandal involving its baby powder and the loss of exclusivity for top-selling arthritis medication Remicade. The stock, though, has managed to shrug off these headwinds to gain a respectable 5.28% so far this year. Quite frankly, the market rarely turns a blind eye to these kinds of major risk factors, especially among blue-chip healthcare companies.
So, why does J&J get a pass? There are two likely reasons. First off, it has one of the best dividend programs among large-cap stocks. As proof, it’s raised its dividend for 56 consecutive years, and its trailing payout ratio of 63% is among the lowest within all of big pharma. Secondly, J&J has repeatedly found ways to bounce back from patent expires, regulatory setbacks, and clinical miscues to deliver market-beating value for its shareholders. So, if you’re searching for a stock to buy ahead of the next crash, this titan of the healthcare space should definitely be on your radar right now.
A sturdy business and a great dividend
Keith Noonan (McDonald’s): Championing a restaurant stock that trades at roughly…
Continue reading at THE MOTLEY FOOL