It seems that the consensus among the financial pundits is that we are heading towards a correction. This chorus of punditry has of course grown much louder after the recent 5 day losing streak in U.S. equity markets. Are they right? I have no clue. Whether markets have a mild correction, big correction or no correction at all really doesn't matter. However, if recent history is any guide, a spring/summer sell-off could be in the cards. Here are three stocks to research further to prepare for Mr. Market's possible pessimism.
Avery Dennison Corporation (AVY) - In short, AVY makes money labeling stuff. The global leader in pressure-sensitive label and packaging materials, AVY provides solutions for a wide variety of products and industries. Walk down the aisles of your local supermarket or drug store and you will see the work of AVY. A stable cash flow business, AVY has been unloved by Wall Street for a while now. With a 3.75% dividend yield, AVY is worth a look.
Paychex (PAYX) - In full disclosure I should note that my mother's portfolio (which I help her to manage) has held PAYX for quite some time now. Every time I consider selling it, I change my mind once I look at the numbers. PAYX is the second largest payroll-processing firm in the U.S. primarily focused on small and midsized businesses. Debt-free, 35% ROE and a current dividend yield of 4.1% make PAYX a company worthy of further research, especially if you believe employment will continue to gather steam over the next several years.
American National Insurance Co. (ANAT) - ANAT is a diversified insurance company operating in the property and casualty, life, health, and corporate segments. Although it has been losing money on underwriting the past few years, insurance prices look set for an upward trajectory over the next several. Also, ANAT is trading well below book value of approximately $138/share and giving investors a $3.08/share in dividends per year. With a closing price of $69.22 as of April 10th and a conservative investment portfolio holding the float, ANAT needs further research as to why it has underperformed lately. It could very well be poised for a rebound.