Are These Top Defensive Stocks In Your Portfolio Right Now?
With uncertainty and volatility being major themes in the stock market today, investors would be looking at defensive stocks now. After all, inflation is running rampant, the Federal Reserve is trying to reel it in, and fears of a recession are growing. Because of this, some of the top defensive stocks would be coming into focus. As this sector of the stock market is home to inflation-resistant businesses and aristocrat dividend stocks alike, this would make sense.
For instance, we take a look at Procter & Gamble (NYSE: PG). Following Amazon’s (NASDAQ: AMZN) Prime Day 2022 event, Procter & Gamble’s diapers and wipes categories did receive an uptick in sales. Notably, its Pampers brand is among the leading categories in terms of sales on its platform. As consumer prices continue to rise, defensive names like PG stock would gain attention during such mega-sales. This would represent the side of the industry that provides consumers with their day-to-day needs. Not to mention, the company also offers a quarterly dividend of $0.91, adding up to a 2.51% annual yield.
At the same time, even health care firms like Walgreens Boots Alliance (NASDAQ: WBA) continue to make headlines. As of yesterday, the company is increasing its quarterly dividend to $0.48 per share. This represents a 0.5% rise while bringing its annual rate from $1.91 to $1.92. Also, it marks the 47th consecutive year of dividend raises for Walgreens. Having read this far, you might be keen on defensive stocks yourself. Should that be the case, here are three more defensive firms to consider in the stock market now.
Defensive Stocks To Buy [Or Sell] Now
- UnitedHealth Group Inc. (NYSE: UNH)
- Costco Wholesale Corporation (NASDAQ: COST)
- Citigroup Inc. (NYSE: C)
UnitedHealth Group Inc.
First and foremost, we have the healthcare and insurance company, UnitedHealth. In essence, the company provides health care coverage, software, and data consulting services. It operates in four segments, UnitedHealthcare, OptumHealth, OptumInsight, and OptumRx. The UnitedHealthcare segment makes use of Optum’s capabilities to assist coordinate patient care, increase medical care affordability, and more. Meanwhile, Optum Health provides health and wellness services, covering physical, emotional, and financial health-related concerns. OptumInsight focuses on data and analytics, technology, and information to assist significant players in the healthcare business.
Today, UnitedHealth has released its second quarter 2022 financial results. Diving in, revenues were $80.3 billion, an increase of 13% year-over-year. This is thanks to both its segments of UnitedHealthcare and Optum, which grew by 12% and 18% year-over-year respectively. The company’s earnings from operations were $7.1 billion, showing a growth of 19% year-over-year. Furthermore, its cash flows from operations were $6.9 billion, to which $4 billion was returned to shareholders in the second quarter through dividends and share repurchases.
In June, the Optum segment of UnitedHealth launched a laboratory benefit management solution to reduce unnecessary testing and improve quality of care. With this solution, it is estimated that health plans can save $12 to $36 per member per year, or more than $3 billion annually. This solution will assist health insurers in aligning lab testing with clinical, evidence-based standards, as well as automating substantial portions of lab benefit administration. Considering all of this, is UNH stock worth buying right now?
Costco Wholesale Corporation
Costco operates membership warehouses. It operates in three segments, the United States Operations, Canadian Operations, and Other International Operations. The Company’s average warehouse space is approximately 146,000 square feet. Moreover, the warehouses of the company work a seven-day, 70-hour week on average. The Company sells items in various categories, including food and sundries which includes dry foods and packaged foods, hardlines which includes electronics and appliances, fresh foods which are fresh produce and bakeries, and ancillary which includes gasoline and pharmacy businesses.
Recently, Costco reported its sales results for June. The net sales were $22.278 billion, an increase of 20.4% year-over-year. For the forty-four weeks ended July 3, the company’s net revenues were $188.34 billion, a 16.9% increase from $161.09 billion during the same period last year. Following this, the company announced that its Board of Directors has declared a quarterly cash dividend on Costco’s common stock of 90 cents per share. This quarterly dividend is payable on August 12, to shareholders of record at the close of business on July 29.
Yesterday, Deutsche Bank (NYSE: DB) upgraded Costco, as the recent upbeat monthly sales data supported a bullish stance. The bank’s analyst, Krisztina Katai, upgraded the stock from a Hold rating to a Buy rating. On top of that, the analyst has assigned a new price target of $579. According to the analyst, Costco is one of the most consistent operators in our group. In an increasingly unpredictable environment, its consistent traffic growth and excellent membership renewal rates serve as major differentiators. Now, is COST stock on your watchlist right now?
Citigroup is a financial holding corporation that provides financial products and services. The company comprises the following segments, Global Consumer Banking, Institutional Clients Group, and Corporate and Other. In its Global Consumer Banking, the company provides retail banking, comprising commercial banking, Citi-branded cards, and Citi retail services. The Institutional Clients Group segment offers a full range of wholesale banking products and services to corporate, institutional, public sector, and high-net-worth clients worldwide.
Citigroup has recently reported its second quarter 2022 results. Among its highlights, revenues were $19.6 billion, an increase of 11% from the prior-year period. The company’s net income was $4.5 billion. Additionally, fixed income trading revenue was $4.1 billion, a surge of 31% year-over-over. Its equity trading revenue rose by 8% year-over-year, to $1.2 billion. Following this, the company has returned $1.3 billion of capital to common shareholders in the form of dividends and repurchases.
Following this report, Citigroup has announced plans to sell its international consumer businesses in an effort to simplify and focus the bank. According to CEO Jane Fraser on the financial results, “our team delivered solid results and we are in a strong position to weather uncertain times, given our liquidity, credit quality and reserve levels.” Knowing all of this, is C stock worth investing in today?