Tired of getting on and off the stock carousel and just want to make a difference? You’re not alone. And that’s not a problem. Despite what some stocks might suggest, buying and holding is still a smart strategy.
Here’s a look at three high-value stocks you can comfortably sit on for years to come, racking up healthy gains by leaving them alone.
Rumors of the death of the personal computer have been greatly exaggerated. While the industry may never relive its roaring 1990s, businesses as well as consumers alike still need PCs to do what smartphones and tablets can’t. While a lull in 2022 is in the cards after this year’s wave of purchases, technology market research agency IDC estimates the world will see slight growth in the number of PCs shipped between 2023 and 2025.
HP is the household name for playing this slow, steady trend, but it might not be the best. This honor undoubtedly belongs to Dell Technologies (NYSE: DELL), which has consistently led its peers this year in PC sales growth despite the chip shortage. IDC reports that third-quarter Dell computer shipments were up 26.6% year-over-year compared to the industry average increase of 3.9%. And that’s even better than its 18.6% increase in the second quarter. In fact, the company has experienced more consistent sales growth than its peers and rivals since the pandemic took hold last year.
Dell is able to avoid supply chain issues as it has strived to digitize its resource planning and simplify the design of its PCs so as to limit the total number of different components the company has. need.
What’s astonishing – and compelling – is that the market has allowed Dell shares to currently trade at just 7.6 times projected earnings per share next year.
Speaking of cheap stocks, check out Gilead Sciences (NASDAQ: GILD). The drugmaker’s shares are currently only valued at 12 times the company’s earnings over the past 12 months – let alone 10 times the estimated 2022 net earnings per share.
Gilead Sciences is best known for his HIV / AIDS treatment, Biktarvy, although hepatitis is also in his wheelhouse. He even has a small hand in the oncology market with Tecartus and Yescarta, both of which treat lymphoma. Then there’s the pipeline, which currently has 45 clinical trials, 17 of which are in phase 2 or phase 3 of their testing. Most of these trials are aimed at expanding the approved uses of the Company’s existing proven drugs.
However, a handful of late stage trials focus on inflammatory and fibrotic diseases. These represent additional income opportunities that will bolster its flagship HIV business, which is not going away anytime soon but is expected to be slow. Consensus projections suggest that it will increase in the range of 3% to 6% per year at least until 2027.
The kicker: All newcomers entering a Gilead position today will receive annual dividends of just under 4% of their purchase price. It’s not a big change to tackle any potential long-term capital appreciation to come.
Finally add Tyson Foods (NYSE: TSN) to your list of value stocks to buy if you have an extra $ 5,000 ready to work.
Yes, food companies appear to be at zero point from the devastating impact of inflation. Not only are wholesale chicken prices up almost 50% from a year ago, the 30% increase in fuel prices is pushing up delivery costs as well. Tyson has already announced price increases several times this year, including a 13% price hike last month.
However, the fact that food producers like Tyson are constantly able to raise their prices is largely lost in the lamentations. Consumers may not like paying more for a meal, but the majority of consumers still find a way to do it. After all, everyone has to eat something. That’s why Tyson forecasts production volume growth of 2% to 3% in 2022, despite prices and costs likely to be still higher.
To that end, seasoned market watchers may recall that these inflation surges come and go, each temporarily shaking investors as well as consumers – but they eventually subside as well. Inflation is generally self-adjusting.
In the meantime, Tyson plans to reduce those costs, both short and long term. Earlier this month, the company announced that it would spend $ 1.3 billion on automation over the next three years, which is expected to lower its production costs, regardless of rising costs of procurement and freight. In total, Tyson aims to save $ 1 billion per year by 2024 through its modernization efforts.
At the current Tyson share price, you can buy this development for just 11 times the estimated profit for next year.
This article represents the opinion of the author, who may disagree with the âofficialâ recommendation position of a premium Motley Fool consulting service. We are motley! Challenging an investment thesis – even one of our own – helps us all to think critically about investing and make decisions that help us become smarter, happier, and richer.