With the markets still running wild and dropping hundreds of points one day only to rally big the next day, investors are seeking stocks that give some peace of mind. The last thing investors want is to wake up to a day when the Dow is plunging 500 points and wiping out their portfolio. Companies that pay dividends and have stable revenues have been great places to ride out the wild markets when bad news seems to overwhelm the fundamentals. Some stocks have traded like they are "Teflon" coated in the sense that bad news from the markets doesn't seem to stick to them or cause them to go down much even as the market plunges. In addition, they might be called "Teflon" coated because revenues are not likely to be impacted by the recent market turmoil.
Cramer is suggesting that investors put bad news and wild market swings into perspective. In a new CNBC article about Jim Cramer, it states "At his hedge fund, some of his employees would bring their concerns about a given disaster being reported in the media. Cramer would respond asking how it affected the earnings of Bristol Myers (BMY). Of course, the stock would rarely be affected by the latest disaster. Cramer's point was that a news event would almost never affect this company's numbers. Cramer would then develop a list of other companies that wouldn't be hurt by the event in case it turned out to be worse than he expected." Read the full article here.
Here are a handful of companies that are not likely to be affected in terms of revenues by all the negative recent headlines, which is one reason why Cramer has been positive on them recently:
Verizon (VZ) is a leading communications company and provides voice, Internet access, broadband data, long distance, etc. This stock offers a solid dividend payout that beats most stocks and other investments. Verizon offers services that will be needed regardless of whether the economy is weakening or not and the dividend is likely to keep it from dropping much more even if the markets decline further. I would wait for dips before buying because this stock has rallied lately.
Here are some key points for VZ:
- Current share price: $36.14
- The 52 week range is $29.10 to $38.95
- Earnings estimates for 2011: $2.24 per share
- Earnings estimates for 2012: $2.60 per share
- Annual dividend: $1.95 per share which yields 5.5%
- Book Value: $13.90 per share
Bristol Myers (BMY) is a leading pharmaceutical company. Cramer likes the new drug pipeline and thinks Bristol Myers could be a takeover target. The dividend yield is almost 5% and the revenues at BMY are not likely to be impacted by the market correction.
Here are some key points for BMY:
- Current share price: $29.29
- The 52 week range is $24.97 to $29.73
- Earnings estimates for 2011: $2.25 per share
- Earnings estimates for 2012: $2.04 per share
- Annual dividend: $1.32 per share which yields 4.6%
- Book value: $9.59 per share
Kinder Morgan Energy Partners (KMP) owns and manages oil and natural gas pipelines and fuel storage centers. Kinder Morgan has remained strong during market correction and only dipped about 10% from recent highs amidst all the turmoil. A strong dividend yield of nearly 7% and a stable revenue source keeps this stock from large sell offs.
Here are some key points for KMP:
- Current share price: $69.10
- The 52 week range is $63.42 to $78
- Earnings estimates for 2011: $1.88 per share
- Earnings estimates for 2012: $2.39 per share
- Annual dividend: $4.60 per share which yields 6.80%
- Book value: $22.32 per share
Kimberly-Clark (KMB) makes a variety of well known consumer products such as Kleenex, Cottonelle, Viva, Huggies diapers, etc. With oil prices falling, it could improve profit margins on the products manufactured by this company. This stock is trading close to the 52 week low and pays a solid 4.4% dividend yield.
Here are some key points for KMB:
- Current share price: $68.43
- The 52 week range is $61 to $68.49
- Earnings estimates for 2011: $2.12 per share
- Earnings estimates for 2012: $2.67 per share
- Annual dividend: $2.80 per share which yields 4.1%
- Book value: $14.93 per share
Consolidated Edison (ED) is a major utility providing electric, gas, and steam primarily in New York, New Jersey, Pennsylvania and other areas. The dividend has been raised each year for the last 37 years and a utility stock is all about stability. This stock has been up in recent trading so I would wait for dips to buy or add.
Here are some key points for ED:
- Current share price: $56.33
- The 52 week range is $46.12 to $54.36
- Earnings estimates for 2011: $3.55 per share
- Earnings estimates for 2012: $3.69 per share
- Annual dividend: $2.40 per share which yields 4.3%
- Book value: $38.43 per share
Data is sourced from Yahoo Finance. No guarantees or representations are made. Hawkinvest is not a registered investment advisor and does not provide specific investment advice. The information is for informational purposes only. You should always consult a financial advisor.