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9 Stocks to Buy Before Inflation Fears Take Hold

Despite the pandemic, the stock market has had a decent year so far. Right now, the Dow Jones Industrial Average is up 14% year-to-date (YTD) while the…

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This article was originally published by Investor Place

Despite the pandemic, the stock market has had a decent year so far. Right now, the Dow Jones Industrial Average is up 14% year-to-date (YTD) while the S&P 500 is up over 23% YTD. But with the threat of inflation currently stoking fears in the fourth quarter, now is the time to start considering inflation stocks.

Inflation stocks provide some protection when prices begin to skyrocket. In October, the consumer price index rose 6.2% from a year ago, which is the biggest increase in 30 years. Core inflation also rose by an alarming rate, moving higher by 4.6% from a year ago.

But all is not lost. CNBC “Mad Money” host Jim Cramer says there are plenty of ways to grow your portfolio even when inflation rises. Cramer says that some of the best inflation stocks come from banking, large pharmaceuticals and tech companies. He noted the following:

“That’s a huge chunk of this market, unlike any combination I’ve ever seen. Plenty of winners out there if you just stop freaking out and start looking at the opportunities.”

Other proven strategies include looking for solid dividend growth, as well as seeking names that help consumers stretch their paychecks.

Here are nine solid inflation stocks to buy in Q4:

  • Apple (NASDAQ:AAPL)
  • American Express (NYSE:AXP)
  • Chevron (NYSE:CVX)
  • Dollar General (NYSE:DG)
  • Dollar Tree (NASDAQ:DLTR)
  • Newmont (NYSE:NEM)
  • Nvidia (NASDAQ:NVDA)
  • Target (NYSE:TGT)
  • Walmart (NYSE:WMT)

Inflation Stocks to Buy: Apple (AAPL)

Source: WeDesing / Shutterstock.com

First up on this list of inflation stocks, Apple is one of those names that could possibly be considered inflation-proof. With a market capitalization of more than $2.6 trillion as well as more than $191 billion in cash on hand, AAPL stock can easily withstand any downturn in the market.

But you shouldn’t expect Apple to drop at all. Returns so far in 2021 are 24%. The company should also see strong sales numbers for the holiday shopping season in Q4. Wedbush analyst Daniel Ives says Apple was expected to sell 10 million iPhones over the Black Friday weekend.

This company’s fiscal Q4 earnings came in a $1.24 per share, up around 70% from a year ago. For the quarter, sales also rose 29% to $83.4 billion. However, revenue missed analyst expectations due to semiconductor chip shortages.

American Express (AXP)

the American Express logo etched into woodSource: First Class Photography / Shutterstock.com

American Express isn’t the biggest or best-known name in the credit card space. However, AXP stock may be one of the best inflation stocks to buy during these inflationary times.

Why? Well, American Express caters to business clients as well as individuals who are more well-off. It makes 82% of its money “from discount fees, card fees, travel-related commissions and other revenue.” Only 18% of its money comes from interest.

In the third quarter, AXP delivered $2.27 per share and revenue of $10.9 billion. Both numbers beat analyst estimates.

This pick is up nearly 28% so far in 2021. Currently, it trades at a forward price-earnings (P/E) ratio of 16.56 times and a forward price-sales (P/S) ratio of 2.93 times.

Inflation Stocks to Buy: Chevron (CVX)

chevron stockSource: LesPalenik / Shutterstock.com

What’s one of the first thing that investors do when they fear inflation? They buy oil. One hedge fund, Man Group, says that energy commodities were the “best performing asset class” in the last eight inflationary periods. That’s why a major oil company like Chevron is a solid pick when looking for inflation stocks.

Chevron is already up more than 37% YTD, but even at these lofty highs CVX stock is far off the highs it reached back in 2018. Right now, it’s coming off a huge Q3, in which the company posted its best quarterly profit in eight years. Net income was $6.11 billion, versus a loss of $207 million in the prior-year period. Finally, cash flow from operations came in at $8.5 billion.

What happened? Of course, Chevron and other oil companies suffered greatly last year when the oil market collapsed because of the pandemic. Because of that, Chevron made big budget cuts. Now that’s being reflected in this year’s profits. In fact, Chevron says that its spending so far this year is 22% lower than a year ago. That gives it an outsized profit margin.

On top of it all, CVX stock pays a great 4.68% dividend.

Dollar General (DG)

Dollar General (DG) store front with yellow store sign, middaySource: Jonathan Weiss / Shutterstock.com

Inflation means that consumers will have less money to spend for both necessary and discretionary spending. For instance, there are already reports of meat and other staples costing more today. Because of that, I always consider dollar stores like Dollar General when I think about inflation stocks.

Based in Tennessee, Dollar General operates more than 17,600 stores across some 46 states. This company’s strategy is to put stores in neighborhoods in order to spread its footprint as wide as possible. Once inside, customers can fine low-cost food, snacks, cleanings supplies, health and beauty products, clothing and seasonal items.

For the year, Dollar General stock is up 6%. Revenue is up by around 53% since 2017, according to Seeking Alpha. What’s more, the company has a reasonable forward P/E of 22 times.

When it comes to DG stock, analyst sentiment is solid. Out of 27 analysts, 22 are bullish or very bullish. Meanwhile, 3 other analysts remain neutral on DG stock.

Inflation Stocks to Buy: Dollar Tree (DLTR)

store front of a Dollar Tree (DLTR) location with green signageSource: shutterstock.com/Jonathan Weiss

Based in Virginia, Dollar Tree is a different kind of discount retailer than Dollar General. With more than 15,000 stores across 48 states as well as in Canada, Dollar Tree buys bulk items and sells them at low prices.

How low? Until recently, items in the store were a dollar (hence the name), but this pick of the inflation stocks recently announced that it was raising the prices of items to $1.25. Additionally, according to NPR, Dollar Tree has been testing higher-priced items for a few months, including adding $3 and $5 products in its Dollar Tree Plus stores.

If nothing else, raising prices will allow Dollar Tree to expand and sell a wider variety of sizes and products.

Most recently, Q3 earnings came in at $6.42 billion and earnings at 96 cents per share. Both exceeded analyst expectations of $6.41 billion and 95 cents per share. Currently, DLTR stock is up a whopping 25% YTD in 2021.

Newmont (NEM)

Newmont (NEM) logo on a mobile phone screenSource: Piotr Swat/Shutterstock

Next up on this list of inflation stocks is Newmont. Gold is a natural hedge against inflation and a market downturn. Sure, cryptocurrencies are flashier and have had a much higher return in the last few months. Still, NEM stock is a solid pick here.

Newmont is the world’s largest gold miner. What’s more, Joule Financial’s Quint Tatro recently told CNBC that NEM is one of his top picks against inflation. The company added to its position in NEM stock after the consumer price index report came out.

“Newmont has an incredible balance sheet. It is truly a proxy for gold. It should move in lockstep with gold if we’re right, and we get paid almost 4% to wait […] I think it will do very well […] You’re getting it at a discount, and I believe that it will continue to rise with gold if we continue to see core inflation move up as well.”

Right now, NEM stock is down by around 8% so far this year. But Fundamental Research analyst Siddharth Rajeev maintained his “buy” rating on the stock, setting a price target of $63.10. That represents more than 14% upside today, which would be welcome during an inflationary run.

Inflation Stocks to Buy: Nvidia (NVDA)

Nvidia (NVDA) logo displayed on phone screenSource: rafapress / Shutterstock.com

According to VandaTrack, which is a Vanda Research flow tracker that measures net stock purchases, NVDA stock was one of the most-purchased equities on Wall Street in November.

Why? Well, Nvidia is absolutely on fire. Up by more than 140% so far in 2021, Nvidia is currently priced at more than $320 per share.

Recognized as one of the world’s biggest semiconductor companies, Nvidia is in an enviable position. Remember, we are still in a chip shortage — and those chips are needed to run everything from electric vehicles (EVs) to computers and small electronics.

If supply and demand rules the world, then this name is in the catbird seat. And that demand is not going to go away just because of inflation.

This pick of the inflation stocks reported its Q3 earnings on Nov. 17. For the period, revenue was up 50% year-over-year (YOY) to $7.1 billion, beating analyst expectations of $6.81 billion. Earnings per share was $1.17, which topped expectations of $1.11.

Target (TGT)

Image of the Target (TGT) logo on a storefront.Source: jejim / Shutterstock.com

Next up on this pick of inflation stocks, Target is a discount retailer that operates higher-end stores than Dollar General and its peers. Presently, TGT stock is up nearly 40% so far in 2021 but slipped after the company reported Q3 earnings in mid-November.

What happened? Well, the company did manage to beat analyst expectations in earnings and revenue. Plus, it raised its outlook. But Target also warned that its margins would be pressured in the coming months as labor costs increase and supply-chain disruptions persist.

No worries, though. That dip is just a solid buying opportunity in TGT stock. One Bank of America analyst also agrees, according to CNBC. Analysts at Raymond James and DA Davidson raised their price targets for Target shares as well.

Inflation Stocks to Buy: Walmart (WMT)

Image of Walmart (WMT) logo on Walmart store with clear blue sky in the backgroundSource: Jonathan Weiss / Shutterstock.com

That brings us to the last entry on this list of inflation stocks: Walmart. This name is the biggest retailer on the planet and boasts revenues of $519 billion according to the National Retail Federation. Walmart operates 10,500 stores across 24 countries.

With its expanding footprint (Walmart owns Sam’s Club, among other brands) and its growing online presence, Walmart had a solid Q3. But what really made the difference was the company’s grocery offerings. Walmart says its size helped it navigate supply chains and keep shelves stocked. CFO Brett Biggs told CNBC the following:

“We’ve always been an inflation fighter for customers […] Our scale and the product breadth that we have allows us to do things in a way that is beneficial to customers and beneficial to shareholders.”

For the quarter, revenue came in at $140.53 billion, versus the $135.6 billion that analysts expected. What’s more, earnings per share came in at $1.45 versus expectations of $1.40.

On the date of publication, Patrick Sanders did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Patrick Sanders is a freelance writer and editor in Maryland, and from 2015 to 2019 was head of the investment advice section at U.S. News & World Report. Follow him on Twitter at @1patricksanders. As of this writing, he did not hold a position in any of the aforementioned securities.

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Fresnillo (OTCMKTS:FNLPF) Rating Lowered to Sector Perform at Royal Bank of Canada

Fresnillo (OTCMKTS:FNLPF) was downgraded by stock analysts at Royal Bank of Canada from an “outperform” rating to a “sector perform” rating in…

Fresnillo (OTCMKTS:FNLPF) was downgraded by stock analysts at Royal Bank of Canada from an “outperform” rating to a “sector perform” rating in a research note issued to investors on Thursday, The Fly reports.

Several other equities research analysts have also issued reports on the company. Scotiabank reaffirmed a “sector perform” rating on shares of Fresnillo in a research report on Wednesday, October 13th. Jefferies Financial Group lowered Fresnillo from a “buy” rating to a “hold” rating in a research report on Thursday. Zacks Investment Research lowered Fresnillo from a “buy” rating to a “hold” rating in a research report on Wednesday, January 19th. Morgan Stanley reaffirmed an “equal weight” rating on shares of Fresnillo in a research report on Wednesday, September 29th. Finally, JPMorgan Chase & Co. reaffirmed a “neutral” rating on shares of Fresnillo in a research report on Thursday, October 28th. Nine equities research analysts have rated the stock with a hold rating and one has assigned a buy rating to the stock. Based on data from MarketBeat.com, the company currently has an average rating of “Hold” and an average price target of $13.00.

OTCMKTS FNLPF opened at $8.60 on Thursday. The business has a fifty day simple moving average of $11.53 and a 200 day simple moving average of $11.51. Fresnillo has a 12 month low of $8.36 and a 12 month high of $16.14. The company has a debt-to-equity ratio of 0.31, a current ratio of 4.98 and a quick ratio of 4.11.

Fresnillo Company Profile

Fresnillo Plc is a holding company, which engages in the production of gold and silver. It operates through the following segments: Fresnillo, Saucito, Cienega, Herradura, Soledad-Dipolos, Noche Buena, and San Julia. The Fresnillo, and Saucito segments are located in the state of Zacatecas, an underground silver mine.

Recommended Story: How can investors invest in the S&P/TSX Index?

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UK SMEs join forces to drive energy storage innovation

Sodium-ion battery module meets artificial intelligence at testbed to drive technologies to market.
The post UK SMEs join forces to drive energy storage…

Sodium-ion battery module meets artificial intelligence at testbed to drive technologies to market

A trio of SMEs have joined forces to accelerate to market innovations in energy storage.

AMTE Power, Brill Power and Starke Energy are collaborating at a commercial-scale testbed at Harwell Campus in Oxfordshire, England.

They aim to prove three new technologies at a battery energy storage system to be integrated with a solar array operated by the Science and Engineering Facilities Council (STFC) at Harwell Science and Innovation Campus.

AMTE Power develops new battery cell technologies; Brill Power is a spin-out from the University of Oxford which develops intelligent battery management and control technology; and Starke Energy uses artificial intelligence to optimise batteries.

First time deployment
The testbed will demonstrate AMTE’s sodium-ion battery module using Brill Power’s technology and Starke’s energy management system, which links stored energy into the electricity grid and markets.

This is the first time that these technologies are being deployed in a commercially relevant project.

Emma Southwell-Sander from the STFC and manager of the EnergyTec Cluster at Harwell Campus said the project “is a prime example of how Harwell’s EnergyTec cluster is facilitating access to young innovative businesses to a wealth of resources to supercharge their route to market”.

Emma Southwell-Sander

The energy storage system at Harwell is expected to be operational from March and will is intended to run for a minimum of 12 months.

As a benchmark, in the project’s first phase, AMTE Power will deploy lithium-ion cells before switching to use the company’s sodium-ion cell technology in the second demonstration phase of the project.

AMTE’s director of business development John Fox said: “The ability to test our new products in a commercial operating environment is invaluable. Having access to the Harwell site will accelerate the time to market for our new energy storage products.”

Network resilience
Sodium-ion batteries offer an alternative to lithium-ion in those markets where cost is more important than weight or performance: particularly energy storage, network resilience and energy in remote locations. Improvements in competitiveness of energy storage technologies will accelerate the uptake of small-scale renewable sources of electricity generation.

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The commercialisation of sodium-ion technology lags behind Li-ion but offers significant advantages that makes it suited as a solution for static energy storage applications; it uses earth-abundant elements, has long cycle life and intrinsic safety advantages.

Brill Power’s battery intelligence technology will be deployed to ensure optimal battery usage, lifetime, performance, and safety. Real-world data and operating parameters will be collected, which will support further optimisation of the technologies deployed in the demonstrator.

Brill launched its first battery management system last year, which is supported by its proprietary battery monitoring and analytics software platform.

“Brill Power’s battery intelligence technology can improve all aspects of advanced battery systems, including performance, cost of ownership, reliability and safety,” said the company’s chief executive Christoph Birkl.

“This testbed will enable us to integrate our technology with other cutting-edge battery innovations and collect real-world data on a commercially relevant site”.

Optimise storage

Starke Energy’s energy management system will integrate the battery system with the local energy network at Harwell.

Using artificial intelligence, it learns how much energy is being produced by renewable sources, and how much is being used to optimise the storage and release of energy across a network of connected intelligent batteries.

Exclusive industry insight: Not all storage solutions are created equal

The project is part of the Interreg North-West Europe STEPS programme that is supporting 40 businesses through, in its first phase, a competitive product enhancement voucher programme – valued at €12.5k each.

AMTE, Brill and Starke were all awarded first phase vouchers in March 2021 and each have benefited from support from Cambridge Cleantech, the UK’s longest-standing membership organisation for the cleantech sector, and the Faraday Institution, the UK’s independent institute for electrochemical energy storage R&D, market analysis and early-stage commercialisation.

This has included tailored testing, introductions to potential end-users and market knowledge to strengthen the competitiveness of their products.

Faraday Institution chief executive Professor Pam Thomas said the energy storage project was “another example of the Faraday Institution acting as convener for partnerships between UK industry, academia and funding organisations as a route to commercialise breakthrough science and engineering to maximise economic value”.

Sam Goodall, head of international projects at Cambridge Cleantech added that the three SMEs “have technologies that can revolutionise the energy storage sector, from AMTE’s Na-ion batteries which remove the need for mineral extraction, Brill Power who make batteries last longer and be more efficient, and Starke’s energy management system which helps optimise the use of the energy and how it is sold together based on AI and IoT”.

The post UK SMEs join forces to drive energy storage innovation appeared first on Power Engineering International.


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Alamos Gold: Haywood Lowers Target To $12.75 Following 2022 Guidance

Last week, Alamos Gold Inc. (TSX: AGI) reported its fourth quarter and full-year production results, as well as their 2022
The post Alamos Gold: Haywood…

Last week, Alamos Gold Inc. (TSX: AGI) reported its fourth quarter and full-year production results, as well as their 2022 to 2024 production estimates.

For the fourth quarter, Alamos Gold produced 112,500 ounces of gold, bringing the full year 2021 production to 457,200 ounces, which was the lower range of guidance. Costs have not yet been finalized but the company says that it is expected to be consistent with their guidance.

The company also provided 2022 guidance, which included expected gold production of 440,000 to 480,000 ounces. Cash costs are expected to be between $875 to $925 per ounce and all-in sustaining costs are to be between $1,190 to $1,240 per ounce. Total capital expenditures will be between $305 and $345 million, while exploration is expected to cost $27 million for 2022.

For the longer run, the company expects these numbers to grow to 460,000 to 500,000 ounces of gold in 2024, with cash costs of $650 to $750 per ounce and $950 to $1,050 of all-in sustaining costs per ounce.

Currently Alamos Gold currently has 13 analysts covering the stock with an average 12-month price target of C$12.46, or a 36% upside to the current stock price. Out of the 13 analysts, 1 has a strong buy rating, 6 have buy ratings, 5 have holds and 1 analyst has a sell rating. The street high sits at C$17.50 or a 91% upside to the current stock. While the lowest price target sits at C$9.98.

In Haywood Capital Markets’ note, they reiterate their buy rating but lower their 12-month price target from C$15 to C$12.75, saying, “lower production and higher costs for 2022,” and that inflation is finally starting to impact the production costs.

For the fourth quarter and full-year production numbers, they came in line with Haywood’s estimates although they note that the full-year production numbers came in the lower half of guidance.

For the companies three-year guidance, Haywood expected 2022 production to be 485,000 ounces, below their high-end figure. While cash costs were expected to be $785 per ounce, lower than their guided number. This is the same for all-in sustaining costs as Haywood expected it to be $1,055 per ounce. Haywood says that this cost increase in 2022, “is due to industry-wide cost inflation as well as temporary higher costs at Mulatos.”

Below you can see Haywood’s estimates versus the company’s guidance.


Information for this briefing was found via Sedar and Refinitiv. The author has no securities or affiliations related to this organization. Not a recommendation to buy or sell. Always do additional research and consult a professional before purchasing a security. The author holds no licenses.

The post Alamos Gold: Haywood Lowers Target To $12.75 Following 2022 Guidance appeared first on the deep dive.



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