Investors have gone on quite a ride in 2022, with the market sinking into a painful bear market. However, if history is any indication, bear markets don’t last, and a fresh bull is always right around the corner.
Markets could still be rocky through the often difficult months of September and October, but some stocks are already poised to offer significant returns for patient long-term holders. And while no one can predict stock movements with certainty, here are seven stocks that all have something of interest to offer investors.
- Stock price as of July 31, 2022: $134.95
In the midst of gloomy earnings outlooks and talks of recession, Amazon is one of the outliers. In the company’s most recent earnings release, Amazon smashed revenue expectations, with its $121 billion in sales topping even management’s own top-end forecasts.
Combined with a rosy forecast for future earnings, the stock popped, reversing investor sentiment and bringing some bullish momentum to the shares. After a recent 20-for-1 stock split, shares are trading at a much more affordable level for investors without access to fractional share purchases.
- Stock price as of July 31, 2022: $162.51
Apple is the largest company in America and is often seen as a “canary in a coal mine” for investors. In other words, the stock market as a whole often trades as Apple shares do.
So when the company reported gangbuster earnings for its 2022 fiscal third quarter at the end of July, many investors took it as a good omen for both the company and for the overall market. Apple reported a June quarter revenue record of $83 billion, indicating that both the company’s business strategy and the consumer market as a whole seem robust.
- Stock price as of July 31, 2022: $116.32
Formerly known as Google, Alphabet owns the global search market and also owns many popular companies that you may be unaware of, from Fitbit and Nest to Waze and YouTube. In its most recent quarter, Alphabet missed on earnings but ad revenue came in above expectations.
Revenue also jumped 13% to nearly $70 billion, so for a “bad” quarter Alphabet still did quite well. Investors agreed, pushing up the stock and positioning it for future gains. The 35 analysts covering the stock have a consensus “strong buy” on it, with a one-year price target about 22% above current levels.
Berkshire Hathaway (BRK-A)
- Stock price as of July 31, 2022: $451,700
There’s a saying on Wall Street that millionaires are made when the market is down. This has certainly been the strategy for the success of Berkshire Hathaway, run by co-chairs and co-billionaires Warren Buffett and Charlie Munger. Berkshire maintains an enormous cash hoard and selectively steps into the market when shares are down, taking advantage of great long-term opportunities.
In 2022, Berkshire Hathaway management has been more active than usual, scooping up shares of downtrodden companies set for future gains. Among the stocks Berkshire Hathaway picked up in 2022 include Occidental Petroleum and HP Inc. The company also added to its top position, Apple, and acquired insurer Alleghany outright. Given the company’s track record of adding value in down markets, now could be a good time to take the ride with Berkshire Hathaway.
- Stock price as of July 31, 2022: $106.10
Shares of Disney have suffered mightily in 2022, down about 32% as of the end of July. However, shares began turning upward in late July, stemming a sharp decline that began well over a year ago.
The 25 analysts covering Disney anticipate gains of over 22% in the next 12 months, with a consensus “strong buy” rating. The return of consumers to cruise ships, movie theaters and theme parks will all help to bolster earnings going forward, with the caveat that a coronavirus resurgence could further delay revenue gains.
Goldman Sachs (GS)
- Stock price as of July 31, 2022: $333.39
Goldman Sachs is another venerable, revered company with shares that have fallen hard in 2022 but have shown some signs of life recently. The investment bank posted solid earnings and revenue figures in its mid-July release, handily outpacing estimates. With interest rates on the rise, banks have more leeway to generate profits, and Goldman Sachs stands to benefit.
While its trading divisions also scored big earnings, the bank’s consumer and wealth management unit posted record revenue, up 25% over the prior year. As a member of the 30-stock Dow Jones Industrial Average and with a current yield of 2.4%, Goldman Sachs has both defensive and offensive characteristics, making it appropriate for a large number of investors.
StoneCo Ltd. (STNE)
- Stock price as of July 31, 2022: $9.58
If you’re an aggressive investor looking for a Warren Buffett-endorsed stock that’s down more than 83% over the past year, StoneCo Ltd. might be for you. The Brazilian fintech has gotten hammered over the past year, but it has essentially flatlined over the last six months, forming a nice trading base and potential entry point for investors.
Even though it’s been dealing with rough times in the Brazilian economy, including high inflation and regulatory issues, the company has been posting solid growth. The stock won’t likely hit its lofty all-time high of over $92 again anytime soon, but the 12 analysts following it have a consensus “buy” rating and expect shares to hit $14 within 12 months, a 47% pop over current levels.
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