The stock market has been experiencing tough times of late due to raging inflation, a war between Russia and Ukraine, aggressive monetary tightening by the Fed, rising energy prices, and extended COVID-19 lockdowns in China. The near-term market outlook remains…
highly uncertain because investor sentiment has taken a beating due to rising recession concerns.
Although stocks rallied post the Fed’s 50 basis points hike in its benchmark rate on Wednesday, the Dow Jones Industrial Average retreated 1,063 points yesterday, marking its biggest single day fall since 2020, while the Nasdaq Composite declined 4.9% to mark its lowest closing since November 2020. The S&P 500 marked its second-worst day this year, closing at 4,146.87, falling 3.5%. And, with the Fed’s hawkish stance, there is little sign of relief in the near term.
Investors worried about a market meltdown could consider betting on Coca-Cola FEMSA, S.A.B. de C.V. (KOF), CGI Inc. (GIB), Novartis AG (NVS), PLDT Inc. (PHI), and Fresenius Medical Care AG & Co. KGaA (FMS). Due to their fundamental strength and favorable industry trends, these companies are well-positioned to perform steadily even during a market meltdown. According to our proprietary POWR Ratings system, these stocks have an A grade for Stability.
Coca-Cola FEMSA, S.A.B. de C.V. (KOF)
KOF is based in Mexico City, Mexico. The company is the largest franchise bottler of Coca-Cola trademark beverages globally by sales volume. It is engaged in producing, distributing, and marketing certain Coca-Cola beverages. Its segments include its Mexico and Central America division, its South America division, and its Asian division.
On April 19, 2022, KOF announced that it had reached an agreement to distribute Campari Group products in Brazil. Well known for alcoholic drinks that include Aperol, SKYY vodka, and Wild Turkey, Campari’s products will be distributed through a KOF subsidiary. KOF’s Chief Executive John Santa Maria said, “We hope to leverage the strength of our distribution network and execution capabilities to increase Campari’s presence in our territories.”
KOF’s total revenue increased 14.5% year-over-year to Mex$51.19 billion ($2.52 billion) for the first quarter ended March 31, 2022. The company’s gross profit increased 13.5% year-over-year to Mex$22.60 billion ($1.11 billion). Also, its operating cash flow increased 11.6% year-over-year to Mex$9.82 billion ($0.48 billion).
Analysts expect KOF’s EPS for its fiscal 2023 to increase 10.1% year-over-year to $3.73. Its revenue for its fiscal year 2022 is expected to increase 7.9% year-over-year to $10.37 billion. It surpassed the Street’s EPS estimates in three of the trailing four quarters. Over the past year, the stock has gained 17.9% in price to close the last trading session at $54.99.
KOF’s strong fundamentals are reflected in its POWR Ratings. It has an overall A rating, which equates to a Strong Buy in our proprietary rating system. The POWR Ratings are calculated by considering 118 distinct factors, with each factor weighted to an optimal degree.
It has an A grade for Stability and a B grade for Value and Quality. Within the B-rated Beverages industry, it is ranked #2 out of 37 stocks. Click here to see the other ratings of KOF for Growth, Momentum, and Sentiment.
CGI Inc. (GIB)
Headquartered in Montreal, Canada, GIB provides information technology and business processes. Its services include the management of IT and business outsourcing, systems integration and consulting, and software solutions selling activities. The company also offers application development, integration and maintenance, testing, portfolio management and modernization services; business consulting; and a suite of business process services.
On April 27, 2022, GIB announced that it had agreed to acquire Harwell Management holding and its subsidiaries through its subsidiary CGI France SAS. The acquisition enables GIB’s CGI Business Consulting business capabilities throughout the vital financial services sectors like retail banking, corporate and investment banking, capital markets, insurance, and other specialized banking services.
For its fiscal second quarter, ended March 31, 2022, GIB’s total revenue increased 6.2% year-over-year to CAD3.26 billion ($2.55 billion). The company’s adjusted EBIT increased 7.6% year-over-year to CAD523.60 million ($409.57 million). Also, its net earnings increased 9% year-over-year to CAD372 million ($290.99 million).
For the quarter ending June 30, 2022, GIB’s EPS is expected to increase 12% year-over-year to $1.21. Its revenue for the quarter ending September 30, 2022, is expected to increase 4.8% year-over-year to $2.49 billion. It surpassed consensus EPS estimates in each of the trailing four quarters. Over the past month, the stock has declined 4.1% to close the last trading session at $79.39.
GIB’s POWR Ratings reflect solid prospects. The company has an overall rating of B, which translates to a Buy in our proprietary rating system.
It has an A grade for Stability and a B grade for Sentiment. Within the A-rated Outsourcing – Tech Services industry, it is ranked #5 out of 10 stocks. To see the other ratings of GIB for Growth, Value, Momentum, and Quality, click here.
Novartis AG (NVS)
Basel, Switzerland-based NVS develops, manufactures, and markets branded and generic prescription drugs, active pharmaceutical ingredients, biosimilars, and ophthalmic products. The company’s business activities are divided into two segments: Innovative Medicines, which includes innovative patent-protected prescription medicines for blood pressure, cancer, and other ailments, and Sandoz, which provides generic pharmaceuticals and biosimilars.
On April 6, 2022, NVS announced that the FDA had granted accelerated approval to Vijoice (alpelisib) for treating adults and pediatric patients two years of age and older with…
Continue reading at STOCKNEWS.com