Although tax season is often the subject of much derision, most taxpayers actually end up receiving a refund. In 2020, about 74% of all filers received a refund, with the average amount approximating $2,700.
While a big tax refund often feels like a windfall, it’s really just a return of the money that you overpaid in taxes throughout the year. Instead of using that money for yourself, you essentially lent it to the government at zero percent interest. Now that you’re getting that money back in the form of a tax refund, use it wisely and apply it to your savings and investments. These 10 stocks are all worthy of consideration; just remember to talk with your financial advisor before you make any investments.
- Stock price as of April 8: $254.95
Boeing is a member of the venerable Dow Jones Industrial Average and a long-time blue-chip company, but it was hit hard even before the pandemic struck. Two crashes of its Boeing 737 MAX jets resulted in 346 deaths, grounding the plane and sinking the company’s stock. The coronavirus pandemic added further fuel to the fire, with orders for planes vanishing amid the near-shutdown of global travel. However, things are turning for the better in both of these areas for Boeing. Vaccine distribution is already resulting in an uptick in travel, and the Boeing 737 MAX is flying once again. The company’s stock charts are looking more promising, with the stock up about 19% year to date, and if these tailwinds remain, Boeing could fly high once again.
- Stock price as of April 8: $187.32
Disney is likely a name that will never be forgotten. The dreamer that gave us everything from Disneyland to Mickey Mouse is a permanent part of the American landscape. And although Walt Disney is no longer with us, his company lives on — and it could be a great investment going forward. Another member of the Dow 30, Disney suffered mightily during the Great Shutdown of 2020, when the coronavirus pandemic kept most Americans in or near their homes. However, 2021 is looking like another story. Movie theaters have slowly started to open, cruise lines are about to set sail and Disney’s iconic theme parks are slowly reopening as well. Analysts have a consensus price target about 15% higher one year out.
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- Stock price as of April 8: $361.22
Costco may be a retailer, but it’s a far cry from the mall-based stores that have faced massive closures in recent years. The membership-only warehouse club offers shoppers great values and a “treasure hunt” experience in its stores, with constantly changing products in addition to beloved favorites. Costco’s membership renewal rate in the U.S. and Canada sits at 91%, evidence of the company’s loyal fan base. This loyalty is vital for Costco, as approximately $3.5 billion of its $5.4 billion operating income in its August 2020 quarter came from membership revenue. In its most recent earnings report, released on April 7, Costco reported a net increase in sales of 15.7% over the prior year, to over $111 billion.
JPMorgan Chase (JPM)
- Stock price as of April 8: $155.12
JPMorgan Chase is the largest bank in the United States and represents the banking industry on the Dow Jones Industrial Average. Banking has had a rough time in recent years, as record-low interest rates and the global pandemic have depressed both lending activity and the spread that banks can earn on loans. As with many industries, however, 2021 is looking healthier on both counts for banks. Interest rates have slowly started to rise, and as the economy heads back toward normalcy, loans are expected to pick up. JPMorgan Chase also relies heavily on its extensive network of travel-related credit cards, and as travel recovers, so too will spending on these cards.
- Stock price as of April 8: $313.02
Love it or hate it, you can’t deny the ubiquity of Facebook, which still holds the title of the most popular social app by a wide margin. In September 2019, an incredible 90.9% of U.S. mobile users accessed the mobile Facebook app, an incredible number. And what were the second- and third-most-popular mobile apps? That’s right, Instagram and Facebook Messenger, also both owned by Facebook. Although the stock will always be controversial, due to privacy concerns among other issues, the company keeps printing money. In its most recent earnings release, Facebook posted its fastest revenue growth in more than two years.
- Stock price as of April 8: $253.25
Microsoft is perhaps best known as the creator of Windows software for personal computers. However, the brainchild of Bill Gates has morphed from a simple software company into a cloud computing giant, thanks to its Azure platform. According to the Wall Street Journal, the battle between Amazon and Microsoft for cloud supremacy will last into the next decade. Microsoft recently announced partnerships with Volkswagen and General Motors’ Cruze to collaborate on self-driving car software, a field with tremendous growth ahead of it. This Dow Jones Industrial Average component looks well-positioned for continued gains in profitability going forward.
- Stock price as of April 8: $182.31
Teladoc is a bit riskier than most of the blue-chip names on this list, but it might also offer more potential upside. Teladoc came to prominence during 2020 as more patients went online to visit doctors rather than seeing them in person. The popularity of this experience is likely to grow, even after the pandemic subsides, but Teladoc has another big tailwind at its back. Thanks to the effects of the pandemic, more and more insurers are now covering telehealth sessions, which could result in enormous revenue gains going forward.
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- Stock price as of April 8: $264.50
PayPal is another company that’s a bit more “newfangled” than some of the stalwarts on this list, but it’s certainly in the right place at the right time. The money transfer service continues to grow in popularity due to its ease of use and the general rise in cashless transactions. But if you’re a believer in e-commerce, then you should be a backer of PayPal as well. As sites like Etsy boom in popularity, PayPal gets to come along for the ride, taking a piece of every cashless payment for online goods.
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- Stock price as of April 8: $2,265.44
Alphabet, which is the parent company of well-known Google, is much more than just the king of search. Google also owns YouTube and the Android operating system, meaning it reaches customers on their computers, their televisions and their smartphones. Add in the Google Cloud and Alphabet’s revenues are booming, jumping from $46 billion to $56.9 billion quarter-over-quarter from 2019 to 2020. Given Google’s entrenched position and its knack for innovation, it’s likely to be a solid investment in the coming years.
- Stock price as of April 8: $139.71
Amazon may get a lot of the headlines these days, but Walmart is still the undisputed king when it comes to retailer revenues. In 2019, Walmart generated $517 billion in sales, well above No. 2 Amazon at about $214 billion. This member of the Dow 30 pays a dividend topping 1.5% and is moving aggressively into e-commerce to counter the rising tide of online retailers like Amazon. In its fiscal 2021, Walmart’s e-commerce segment jumped 79%, with large gains from its grocery pickup and delivery service. Not content with simple e-commerce, Walmart is also moving into health clinics, insurance and financial services. Combined with a recovering economy climbing out of the pandemic recession, Walmart has a lot of catalysts for continued growth.
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