When searching for the best stocks to buy today, investors could be looking into defensive stocks. Given the recent resurgence of coronavirus cases, I could understand if this section of the stock market gains traction now. Before we go into the details, what are defensive stocks might you ask? Well, simply put, defensive stocks offer investors consistent dividends and stable earnings regardless of the current business cycle. This is mainly because their offerings are constantly in demand in good times and bad. In theory, companies in this sector are often safer plays during times of market volatility, hence the name.
Now, when it comes to defensive stocks, investors would likely turn to several key sectors. Some key examples would be the consumer staples, health care, finance, and utility industries. Accordingly, companies such as Target (NYSE: TGT), Pfizer (NYSE: PFE), and American Water Works (NYSE: AWK) would fit the bill. Given the constant reliance on their wares and services, most would argue that they are among the more defensive options in the stock market today. Overall, as investors weigh their options amidst the current market conditions, defensive stocks could be worth looking at. Should you be looking to diversify your portfolio now, here are four to consider.Best Defensive Stocks To Watch Ahead Of August 2021
- Honeywell International Inc. (NASDAQ: HON)
- Amazon.com Inc. (NASDAQ: AMZN)
- American Express Company (NYSE: AXP)
- Capital One Financial Corporation (NYSE: COF)
Starting off, we have Honeywell. The company delivers industry-specific solutions that include control technologies and performance materials globally. In essence, its technologies help everything from buildings, manufacturing plants, supply chains, and aircraft. For instance, it has developed more fuel-efficient and safer aircrafts. HON stock currently trades at $227.86 as of 11:36 a.m. ET and have risen in valuation by over 45% in the past year. Today, the company reported its second-quarter financials.
Firstly, the company said that its reported sales were up by 18% year-over-year at $8.80 billion. Organic sales for the quarter were up by 15%. Secondly, the company reported earnings per share of $2.04, up by 33% year-over-year. Honeywell said that it beat guidance and delivered an amazing quarter that was driven by top-line growth and margin expansion in all 4 of its segments.
Furthermore, the company reported that it will be raising the midpoint of its adjusted earnings per share guidance by 15 cents as it continues to build momentum this year. Full-year sales are now in the range of $34.6 billion to $35.2 billion. Given the excitement surrounding Honeywell, will you consider adding HON stock to your watchlist?Source: TD Ameritrade TOS
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Amazon is a multinational tech company that has a wide variety of businesses. This would include one of the largest e-commerce platforms in the world, cloud computing, digital streaming, and artificial intelligence. Given how its online marketplace and streaming services are used by millions all over the world, the company continues to enjoy stable earnings and growth. AMZN stock currently trades at $3,646.42 as of 11:36 a.m. ET.
Last month, the company announced that it is launching new renewable energy projects in the U.S., Finland, Canada, and Spain. This comes as it commits to decarbonize its business operations and reach net-zero carbon by 2040. Impressively, the company is already the largest corporate buyer of renewable energy in Europe. By investing in green technologies, the company will be able to supply renewable energy for its corporate offices, fulfillment centers, and AWS data centers that support millions of customers around the world. This could also help cover the energy demands required to power Amazon’s growth in the long run. With that in mind, is AMZN stock worth watching right now?Source: TD Ameritrade TOS American Express Company
Next on this list is American Express, a financial services corporation. The company is also a globally integrated payments company whose platform includes card-issuing, merchant-acquiring, and card network businesses. Also, it caters to a broad range of customers that includes consumers, small businesses, mid-sized companies, and large corporations around the world. AXP stock currently trades at $176.19 as of 11:37 a.m. ET.
The company also reported strong second-quarter financials today. To begin, American Express posted revenue of $10.24 billion for the quarter, a 33% increase year-over-year. It also reported a net income of $2.3 billion for the quarter. These results reflected the impact of $866 million in credit reserve releases, primarily driven by the company’s strong credit performance and continued improvements in the macroeconomic outlook.
“Our strong second-quarter results show that the steps we have taken to manage the company through the pandemic and our strategy of investing to rebuild our growth momentum are paying off,” said Stephen J. Squeri, Chairman and Chief Executive Officer. With that being said, will you consider adding AXP stock to your portfolio?Source: TD Ameritrade TOS Capital One Financial Corporation
Another name in the defensive space to consider now would be the Capital One Financial Corporation (COF). In brief, it is a bank holding company that offers consumers a wide array of financial services. As you can imagine, this ranges from credit cards and auto loans to general banking solutions. Now, COF’s offerings would be in demand regardless of the current state of the market. This would be the case as it is a notable player in the finance industry today. As such, I could see investors eyeing COF stock. With the company’s shares trading at $162.75 as of 11:37 a.m. ET, would it be a wise investment?
If anything, COF seems to be firing on all cylinders given its stellar second-quarter fiscal reported yesterday. Namely, it posted earnings per share of $7.62 for the quarter, beating consensus estimates of $4.64 by a landslide. The company also reported total revenue of $7.4 billion, above Wall Street’s projections as well.
According to CEO Richard Fairbank, COF’s current tech continues to power its performance. Fairbank believes that all these positions the company to capitalize on the “accelerating digital revolution” in the banking industry now. Overall, COF reported total assets of $423.4 billion as of June 30, 2021. Given all of this, would you consider COF stock a top defensive stock to watch now?Source: TD Ameritrade TOS