With the recent volatility prevalent in the international stock market, leading investors are in a fix when it comes to investing in a safe stock. As of late, many investors have found it an ordeal to determine which company has the capacity to pay long-term returns on investment and which does not. This is because stocks investments have traditionally involved a high level of planning and assessment because of the manifold risks involved.
At times, even the most promising stock performers disappoint investors with unfavorable returns on investment. At such times, investors seek fair unbiased reviews from financial analysts in order to determine the profitability of a stock investment. Here, I will discuss five stocks which investors can play for safe returns in 2012. I chose these five stocks because they all have a strong history of stable performance in highly volatile market conditions.
Caterpillar has ended only second in the Dow 30 performer with an impressive run in January. The company recorded favorable readings of 21% on returns on shares. Furthermore, based on a quarterly payout ratio of nearly 46, Caterpillar currently has an impressive dividend yield of around 2%. The company has recently announced a fourth-quarter profit of nearly $1.5 billion which is roughly equivalent to $2 per share. Compared to previous numbers, the company has stretched its profit by around $1.35 billion. Investors are also optimistic that the company will continue its drive to effectively tackle internal operational issues to emerge victorious.
Caterpillar has confirmed that its "sales and revenue outlook for the current year has been extended to the $68 to $72 billion range. It is also determined to drive up its profits earned per share to around $9. Current share price is around $114 with a 52-week range of $67 to $116. The company has a total market capitalization of almost $74 billion with an average trading volume of nearly $8 million.
The price-to-earnings ratio is steady at 15 and decent earnings per share of $8 have managed to keep the interest of investors in the business. Caterpillar has traditionally enjoyed a good dividend history with a current dividend payout ratio of 0.4 and dividend yield of almost 2%. All these financial indicators suggest that Caterpillar is likely to continue its drive towards growth this year. In my opinion, it qualifies as a safe and profitable investment in the year 2012.
Medtronic has emerged as a leader in various lucrative industry segments such as vascular, cardiac surgery, cardiac rhythm management, urology, gastrointestinal, diabetes and ENT. The company has a huge international market with international sales accounting for nearly 45% of total aggregate sales. The rating of Medtronic has substantially declined compared to about a decade ago when it recorded 20% increased earnings per share. However, Medtronic has sustained its progress towards growth amidst a myriad of challenges which include a lawsuit pricing pressures, cut-throat competition, declining international markets and a stagnant U.S. economy.
A new range of innovative products has helped Medtronic maintain a good run in the opening month of 2012. Investors speculate that the company has the capacity to continue current performance throughout the first quarter provided that critical market factors and investment environment remains unchanged. Medtronic's financial strength remains as good as ever. It has a total market capitalization of nearly $74 billion with average trading volume easily exceeding $7 million. At a share price of $113, the company has skillfully maintained a 52-week share price range of $113 to $114.
Medtronic has a price to earnings ratio of around 15 and earnings per share have been recorded at nearly $7. These financial ratios have greatly helped the company widen it competitive moat and sustain a dividend payout ratio of 0.5. A dividend yield of nearly 2% has also been favorable encouraging investors. According to my expert assessment, all these financial indicators suggest that Medtronic is likely to increase its revenues during the first quarter of 2012.
Huntington Bancshares Inc. (NASDAQ:HBAN)
Huntington Bancshares Inc. is a diversified bank holding company with almost 150 years of experience in providing financial services to its clients. Investors have observed the company to show favorable upward movement in the wake of the global financial recession that has affected global economies since 2009, especially in the Midwest states. Throughout the third quarter of 2011, Huntington Bancshares impressed investors by making slow yet steady growth amidst a horde of challenges prevalent in a volatile market. The current market capitalization of Huntington Bancshares currently stands strong at approximately $5 billion dollars with an average daily trading volume easily exceeding $14 million.
Huntington Bancshares has recorded healthy earnings per share of about $0.50 at a share price of around $6. It has a decent price to earnings ratio of about 9 which it has been able to maintain over the course of the last year. Huntington Bancshares has a good dividend history with a dividend payout ratio rate of almost 0.5 and a dividend yield of nearly 3%. All these favorable financial indicators have helped Huntington Bancshares widen its competitive moat giving it the capacity to invest in new lucrative business ventures such as the iPad Marketing Platform. Given the promising upward movement observed by investors in the first month of 2012, I believe that the business will boost its dividends in the first quarter.
MAKO Surgical Corp. (NASDAQ:MAKO)
MAKO is a medical device company that markets advanced robotic arm solutions and customized implants for orthopedic procedures around the globe. The company has traditionally enjoyed healthy investor sentiment in recent years which has largely been driven by favorable upward growth in the first month of 2012. Independent fair financial analysts have rated the company as one of the best in terms of investments returns and security. MAKO has a current share price of about $34 with a 52-week high-low range of $16 to $43.
The company currently has a huge market capitalization of nearly $2 billion with daily trading volume just shy of a million dollars. Although price to earnings ratio and of -0.25 for the last quarter of 2011 were considerably below the expectations of investors as well as financial experts such as me, MAKO seems poised form the onset of the new year to redeem itself. According to my expert assessment, the company has the potential to outshine others with a wide competitive moat and lucrative investments spread across various business ventures.
Microsoft Corp. (NASDAQ:MSFT)
Microsoft is the undisputed leader of global software technologies and solutions catering to an international market. With a diversified product range and imitative new technologies, the company has grown over the years in leaps and bounds. In the wake of the recent global financial meltdown, Microsoft impressed investors with its steady growth triggers that were crucial in building investor sentiment. Microsoft Corp. has a share price of around $31 with a 52-week range of 30 to 31. These figures reflect how steady the share price has been over the year. Leading financial experts have ranked Microsoft stock as one of the safest investments ventures. The company has a current market capitalization of approximately $255 billion with an impressive daily trading volume of $56 million.
Microsoft Corp. has recently made a drive towards investing in new technologies and markets as a means to widen its competitive moat. With a price to earnings ratio of almost 11 and earnings per share of nearly $3, investors are optimistic that they will get better returns on investment. Microsoft Corp. also has a healthy dividend history which is reflected by a payout ratio of 0.2 and a dividend yield of nearly 3%. Considering the fact that the opening month of 2012 has been particularly impressive for the company, financial analysts speculate the company to continue its drive throughout the first quarter. In my opinion, Microsoft Corp. is one of the best stock investments of 2012.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.