4 Trending Cyclical Stocks To Watch In The Stock Market Now
Cyclical stocks appear to be back in trend in trend in the stock market now. This appears to be the case after the broader stock market hit new record highs yesterday. If anything, the current volatility across the market is happening despite a series of major companies reporting earnings this week. At the same time, fears over a rising number of coronavirus cases continue to create unique buying opportunities for investors across the board. While it may be tempting to buy on the dip, would investors be wise to do so?
Well, for one thing, Bryn Mawr’s chief investment officer, Jeff Mills seems to think so. Just last week, Mills argued that the recent slowdown in value & cyclical stocks benefits investors. After all, cyclicals stand to benefit from the eventual upswings in the economy post-pandemic. Even now, companies such as Ford (NYSE: F) and Carnival (NYSE: CCL) are hard at work. On one hand, Ford is doubling down on the electric vehicle (EV) craze now. Namely, it is carrying out a $2.5 billion round of investments with Amazon (NASDAQ: AMZN) into EV start-up, Rivian. On the other hand, the CDC’s recent pullback on its Conditional Sail Order plays to Carnival’s advantage as only vaccinated passengers can sail. This would serve to minimize further cruise ship outbreaks, allowing operations to continue.
Overall, both F stock and CCL stock are now sitting on gains of over 150% since their pandemic era lows. While the world continues to deal with the pandemic, the prospects for a post-pandemic recovery continue to rise. Regardless of the current pandemic conditions, investor focus on cyclical stocks seems to be going strong. Because of all that, could these cyclical names be top picks in the stock market today?
Top Cyclical Stocks To Buy [Or Sell] Ahead Of August 2021
- Advanced Micro Devices Inc. (NASDAQ: AMD)
- Walt Disney Company (NYSE: DIS)
- Square Inc. (NYSE: SQ)
- Tesla Inc. (NASDAQ: TSLA)
- 3M Company (NYSE: MMM)
Advanced Micro Devices Inc.
Starting off on this list, we have Advanced Micro Devices, a multinational semiconductor company that is based in California. It develops computer processors and related technologies for a wide variety of markets. It has hundreds of millions of consumers and many leading Fortune 500 businesses rely on AMD’s products and services. AMD stock currently trades at $89.28 as of 1:19 p.m. ET. The company will announce its second-quarter financials after the market closes today.
The company has been firing on all cylinders lately. In late June, it announced the availability of its cutting-edge spatial upscaling solution, AMD FidelityFX Super Resolution. The feature will be offered to more than 100 AMD processors and GPUs. This could appeal to the broader market as many consumers still utilize older CPUs and GPUs. Ultimately, this could win over customers from rivals Nvidia (NASDAQ: NVDA) and Intel (NASDAQ: INTC) and increase the market share for AMD. All things considered, will you be adding AMD to your radar right now?
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Walt Disney Company
Disney is a cyclical stock that focuses on mass media and entertainment. The company is known for its film studio division, The Walt Disney Studios which includes household names like Pixar, Marvel Studios, and Lucasfilm. Notably, the company has invested significantly into its Disney+ streaming service and boasts over 100 million global subscribers. What is impressive is that when it had to shutter its resorts and theme parks last year, it capitalized on its streaming services. DIS stock currently trades at $177.80 as of 1:24 p.m. ET.
In May, the company reported its second-quarter financials for fiscal 2021. Firstly, the company posted revenue of $15.61 billion. This was driven by continued success for its streaming services and also the expansion of its portfolio of multi-year sports rights deals for ESPN and ESPN+. Secondly, it posted a net income from continuing operations of $912 million, up by 95% year-over-year. Dilute earnings per share from continuing operations was $0.50. With that in mind, will you consider DIS stock a top cyclical stock to add to your August watchlist right now?
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Square is a financial services and digital payments company that is based in San Francisco, California. Its software is used to empower businesses and individuals all over the world. The company also provides a cohesive commerce ecosystem that helps sellers run and grow their businesses. SQ stock currently trades at $247.12 as of 1:24 p.m. ET and has more than doubled in the last year. Last week, Square announced an exciting piece of news.
The company launched Square Banking, a suite of financial products purpose-built to help small business owners easily manage their cash flow and get more out of their money. It essentially reimagines the financial system for small business owners with their cash flow needs at the center. By offering essential banking tools that work seamlessly with Square’s ecosystem of solutions like payments and Square Payroll, sellers now have a single home for their entire business, gaining a unified view of their payments, account balances, expenditures, and financing options. Given the excitement surrounding this piece of news, do you consider SQ stock a buy right now?
Another hot name in the cyclical stock market now would be Tesla Inc. Namely, the EV industry leader continues to make headlines across the board today. From its cutting-edge EV offerings to its clean energy home to grid operations this would be the case. By and large, most would argue that Tesla is in a prime position to gain from the global green wave. Now, TSLA stock is trading at $628.38 as of 1:24 p.m. ET.
Earlier today, the company reported record figures in its second-quarter fiscal. In particular, the company reported earnings per share of $1.45 on revenue of $11.96 billion for the quarter. Notably, both of these figures are well above consensus estimates of $0.98 and $11.30 billion respectively. If that wasn’t enough, the company also saw its net income surpass the $1 billion mark this quarter. This would indicate a tenfold increase year-over-year. With all that said, could TSLA stock be a top stock to watch for you now?
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The 3M Company
Lastly, we have 3M, a multinational conglomerate corporation that operates in industrial, health care, and consumer goods segments. It strives to improve many aspects of daily lives and has created many game-changing products. A huge chunk of its business is in safety and industrial products. This includes respiratory, hearing, and eye protection solutions known for their unparalleled safety. MMM stock currently trades at $201.06 as of 1:25 p.m. ET.
On Tuesday, the company announced its second-quarter financials. To begin, sales were $8.9 billion for the quarter, up by 24.7% year-over-year. It also returned $1.4 billion to shareholders via dividends and gross share repurchases. 3M delivered a strong quarter this time around, with organic growth across all business groups and geographic areas. The company says it remains focused on investing in growth opportunities coming out of the pandemic. For these reasons, will you consider watching MMM stock?