Do You Have These Top Cyclical Stocks On Your July 2021 Watchlist?
While investors may be looking for the most volatile stocks today amidst the meme stock hype, cyclical stocks remain relevant. After all, this part of the stock market is home to companies whose businesses follow economic cycles closely. With the economy still in recovery, the growth case for cyclical stocks remains the same regardless of recent slowdowns. With widespread vaccination and government infrastructure spending plans in place, we could be looking at exciting times ahead for cyclicals. Now, as we enter another earnings season, investors could be keeping an eye on their top cyclical stock picks. Would it be wise to follow suit?
If anything, companies in the industry could be looking at good quarters ahead given the recent rise in consumer spending across the board. Evidently, PepsiCo (NASDAQ: PEP) reported solid figures in its latest quarter fiscal posted earlier today. In it, the company posted earnings of $1.72 a share on revenue of $19.22 billion for the quarter. Notably, this exceeds Wall Streets’ expectations by a sizable amount. If this is an indication of earnings to come, other companies in the cyclical space could also be worth noting.
Namely, travel companies such as Royal Caribbean (NYSE: RCL) and Delta Airlines (NYSE: DAL) could see upticks in their earnings. This would be the case as consumers eagerly welcome the return of domestic travel. Meanwhile, increased federal funding could also see clean energy stocks among other industrial stocks having more room to grow. All around, cyclical stocks appear to be gaining momentum. Should this have you keen on the sector, here are four making waves in the stock market today.
Best Cyclical Stocks To Watch Right Now
- Ford Motor Company (NYSE: F)
- Carnival Corporation (NYSE: CCL)
- Enphase Energy Inc. (NASDAQ: ENPH)
- American Airlines Group Inc. (NASDAQ: AAL)
Ford Motors Company
Ford is a multinational automaker that is headquartered in Michigan. The company is committed to its Ford+ plan for growth and value creation. It does this by combining its existing strengths in manufacturing with new technologies and customer-centric relationships for its next-generation vehicles. Ford has been investing significantly in its electric vehicle (EV) portfolio. In fact, it is planning to invest a whopping $30 billion in vehicle electrification efforts by 2025. F stock currently is up by over 130% in the last year.
Last week, the company announced that it’s 2021 Ford Mustang Mach-E earned the Car and Drivers’ inaugural Electric Vehicle of the Year Award. The publication put 11 top-rated electric vehicles through rigorous testing over three weeks, including a 1,000-mile road trip to evaluate each in real-world conditions.
Ford’s Mustang Mach-E took the No. 1 spot. This would be a testament to the company’s technological prowess in designing top-of-the-line EVs. For this exciting reason, will you consider F stock a top cyclical stock to watch right now?
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Carnival is a cyclical stock that is also the world’s largest leisure travel company. It provides travelers around the globe with extraordinary vacations at an exceptional value. The company’s portfolio includes brands like Carnival Cruise Line and AIDA Cruises. It boasts a fleet of over 80 ships visiting 700 ports around the world. CCL stock currently trades at $22.85 as of Tuesday’s closing bell. Carnival has been busy with its reopening plays as countries around the world continue to ramp up vaccination efforts.
For instance, the company recently announced that due to the high demand for voyages in Germany, AIDA Cruises will deploy another Sphinx-class ship from Kiel. On August 15, 2021, the first four-day short cruise to Gdynia will start followed by a three-day cruise to Gothenburg.
Also, a wide variety of travel dates are available up to October 14, 2021, and all-new vacation offers are bookable now. Last week, Carnival also reported that all cabins on its P&O Cruises were sold out on the first day, demonstrating pent-up demand for cruise travel. With that in mind, will you watch CCL stock?
Enphase Energy Inc.
Another company to consider in the industry today would be Enphase Energy Inc. Sure, most would not immediately think of the company when discussing cyclical stocks. However, Enphase’s clean energy solutions are focused on consumers. Given that consumer spending on home improvement is on the rise, the company’s services could be in demand. For the uninitiated, Enphase specializes in manufacturing and marketing software-driven home energy solutions. The likes of which would serve to help consumers transition towards using solar energy to power their homes. As such, I could see the current cyclical and pro-environmentalism trends putting ENPH stock in the spotlight now. The company’s shares currently trade at $184.06 as of Tuesday’s closing bell.
In late June, the company launched its Encharge Battery Storage System in Germany. This would be the product’s first expansion into the European market. The system offers configurations ranging from 3.5 kWh to 42 kWh, and will help meet installer and homeowner needs for a safe and reliable all-in-one solution.
“Enphase already offers 24/7 customer support, and now homeowners can count on that for both their microinverters and batteries,” said Michael Wesche, General Manager of Wesche Walser Solar GbR Weiterstadt. “Having one centralized source of training and support for installers makes a big difference in the quality of our interactions with customers.” All things considered, will you add ENPH stock to your watchlist?
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American Airlines Group Inc.
Topping off our list is American Airlines Group Inc. (AAL). In brief, the Texas-based airline operator is one of the major players in the American airline industry now. Notably, it is one of, if not the world’s largest airline in terms of fleet size and passengers carried. In terms of scale, the company’s network can facilitate 6,700 daily flights to nearly 350 destinations across 50 countries. More importantly, AAL stock is looking at gains of over 105% since its pandemic era low. With the company’s shares currently trading at $20.02 apiece as of Tuesday’s close, would it be a good time to invest?
Well, for one thing, reopening trends continue to bolster demand for AAL’s services. Recently, the company reported that its July 4 weekend passenger count more than tripled year-over-year. This increase in passengers resulted in AAL flying twice the number of flights compared to year-ago levels.
According to COO David Seymour, the company also recently hired 300 customer operations employees at its key Dallas/Fort Worth International Airport hub, accounting for increased travel demand. Overall, it seems like business is picking up for AAL now. Does this make AAL stock worth watching ahead of the company’s second-quarter earnings next week for you?