You Survived – Now Let’s Make Some Money!
Sideways action for stocks could be the norm for the immediate future, but there’s always a way to extract real income from the market.
The key is to shop selective. Today we take a look at targets you’ll want to consider adding to your 2018 “shopping list”.
Read on below…
Start Your “Shopping List” While You Wait Out the Correction
U.S. stocks lost over $2 trillion in market value over the past week, climaxed with massive back-to-back sell-offs — with only a short pause over Super Bowl weekend.
Of course, this pullback began right after record-setting cash flows from retail investors of $100 billion into equity funds during January, proving when it comes to the market, timing is everything!
Sure, plenty of investors are shell-shocked by the rapid reversal of fortune, and many prefer to watch from the safety of the sidelines.
But while you’re waiting for the stock market to stabilize and make its next move, you don’t want to just sit idly by trying to figure out what comes next.
Instead, you want to keep busy by putting together your “shopping list” of quality stocks and ETFs that you can buy when the dust settles.
Today, I want to talk about two of my favorite sectors that have plenty of upside potential right now despite the recent market action.
Energy: You’ve heard me talk before about how underdog commodity stocks, unloved in recent years, are now poised for a big rebound. Case in point: oil and gas stocks.
Crude oil got clocked over the past few years, plunging more than 70% from the 2014 peak. Energy stocks, of course, followed suit to the downside with plenty of bankruptcies and dividend cuts in the oil patch.
But crude prices are on the rebound, up over 40% from the 2017 low, and the fortunes of select quality energy stocks have reversed to the upside as well. Along with the rebound in oil, earnings in the energy sector are soaring.
Here’s a fun fact: Energy stocks are posting the strongest quarterly results of ANY sector in the S&P 500, up a whopping 110.8% year over year!
And two stocks you may want to consider for your shopping list include Exxon Mobil (NYSE: XOM) and Sunoco LP (NYSE: SUN).
As I’ve written before, XOM is a great dividend payer with lots of upside potential as crude prices stay strong. SUN weathered the recent correction fairly well, and overall is already up 4.57% this year. With positive expectations in the energy sector for 2018, this could be another great addition to your portfolio,.
Health Care: If you’re looking for a defensive-minded combination of high quality and high dividend yield, health care is the place to be. First, the health care sector is relatively undervalued right now in an overpriced stock market, but that hasn’t hurt the performance of health care stocks.
The sector jumped 10.7% in January, an even faster start than the overall market. Biotechnology stocks, a subset of the health care sector, are performing even better, up 13%.
For health care, I have plenty of favorites, two of which are Gilead Sciences (NASDAQ: GILD) up 7.66% year to date and Pfizer Inc. (NYSE: PFE). Pfizer took a hit over the past few days, but for the past 200 days the stock’s risen almost 9%, and is up 1.76% already after the Monday’s correction.
Bottom line is, if you’re looking for stocks with big profit potential once the stock market rebounds, go shopping in the energy and health care sectors!
Here’s to growing your wealth,
Chief Income Expert, Mike Burnick’s Wealth Watch