The stock market has been highly volatile so far in 2022 due to the ongoing macroeconomic headwinds, including the Fed's hawkish stance, growing inflation, rising economic sanctions on Russia owing to the Russia-Ukraine war, and supply chain constraints. These conditions pushed the major benchmark indexes into bear market territory earlier this month.
Amid these conditions. investors are being drawn toward fundamentally strong, well-established, and resilient companies that could hedge the increasing market risks. These companies are less affected by the current market fluctuations, owing to their strong financial records, sufficient cash flows, and promising growth prospects. These companies have delivered impressive returns in the past and are well-positioned to grow significantly in the future.
Given these factors, we think investors could solidify their portfolios by adding quality stocks CVS Health Corporation (CVS), CRH plc (CRH), and Carrefour SA (CRRFY). These stocks are rated ‘Strong Buy’ in the POWR Ratings system.
CVS Health Corporation (CVS)
CVS in Woonsocket, R.I., provides health services in the U.S. The company operates through four segments: Pharmacy Services; Retail/LTC; Health Care Benefits; and Corporate/Other. CVS offers prescription drugs, traditional and consumer-directed health insurance products, pharmacy benefit management solutions, and consumer health and beauty products. It operates more than 9,900 retail locations, 1,200 MinuteClinic locations, online pharmacy websites, and onsite pharmacies.
On February 22, 2022, CVS Pharmacy, the retail division of CVS, launched six new innovative home health care products. The products were developed in collaboration with Michael Graves Design. This launch is the company's extension of its exclusive CVS Health product line, extending its customer reach and boosting sales.
In the fiscal 2021 fourth quarter, ended Dec. 31, 2021, CVS' total revenues increased 10.1% year-over-year to $76.60 billion. The company's adjusted operating income grew 40.8% year-over-year to $4.15 billion. Its net income increased 32.9% from the prior-year period to $1.30 billion. And CVS' adjusted earnings per share rose 52.3% from the year-ago value to $1.98.
The $75.14 billion consensus revenue estimate for its fiscal year 2022 first quarter, ending March 31, 2022, represents 8.8% year-over-year growth from the same period in 2021. The $2.15 consensus EPS estimate for the current quarter indicates a 5.2% year-over-year rise from the prior-year period. The company has an impressive earnings surprise history; it surpassed the consensus EPS estimates in each of all the trailing four quarters.
Shares of CVS increased 46.5% in price over the past year and closed yesterday's trading session at $107.23.
CVS' POWR Ratings reflect this promising outlook. The stock has an overall A rating, which translates to Strong Buy in our proprietary system. The POWR Ratings assess stocks by 118 distinct factors, each with its own weighting.
CVS has a B grade for Sentiment, Stability, Growth, and Value. Within the A-rated Medical - Drug Stores industry, it is ranked #1 of 4 stocks.
To see additional POWR Ratings (Momentum, and Quality) for CVS, click here.
Click here to checkout our Healthcare Sector Report for 2022
CRH plc (CRH)
CRH manufactures and distributes building materials. It is headquartered in Rathfarnham, Ireland. The company operates through three segments: Americas Materials; Europe Materials; and Building Products. CRH manufactures and supplies cement, lime, ready mixed concrete, and asphalt products. It also offers polymer-based products, construction accessories, and network access products. It serves governments, contractors, home builders, and homeowners.
In March, CRH completed the latest phase of its share buyback program. CRH returned $0.3 billion of cash to shareholders under this program. The $3.2 billion has been returned to shareholders since the program’s inception in May 2018.
CRH's revenue has increased 12.3% year-over-year to $30.98 billion in its fiscal year 2021 ended Dec. 31,2021. Its gross profit improved 14.5% year-over-year to $10.49 billion. CRH's group operating profit increased 58.4% year-over-year to $3.59 billion. And its EBITDA increased 16% year-over-year to $5.35 billion. Its group profit for the financial year grew 125% year-over-year to $2.62 billion, and the company's earnings per ordinary share rose 130% year-over-year to $3.26.
Analysts expect CRH's revenue for its fiscal year 2022, ending Dec. 31, 2022, to come in at $31.76 billion, representing a 2.8% rise year-over-year.
CRH closed yesterday's trading session at $43.88.
CRH's POWR Ratings reflect this strong outlook. It has an overall rating of A, which translates to Strong Buy in our POWR Ratings system.
It has a B grade for Value, Stability, Growth, and Quality. It is ranked #2 of 52 stocks in the B-rated Industrial - Building Materials industry.
Click here to see CRH ratings for Momentum and Sentiment.
Click here to check out our Industrial Sector Report for 2022
Carrefour SA (CRRFY)
CRRFY operates stores in various channels in France, Spain, Italy, Belgium, Poland, Brazil, Romania, Argentina, and Taiwan. CRRFY is based in Massy, France. The company operates hypermarkets, supermarkets, convenience stores, e-commerce sites, and service stations. In addition, it participates in banking, insurance, and franchise activities and provides travel agency services.
Last September, CRRFY partnered with Realty Income Corporation (O), in which Reality Income closed a €93 million ($102.39 million) sale-leaseback transaction in Spain, comprising seven properties under long-term net lease agreements with CRRFY and its real estate subsidiary. "We are delighted with this transaction with a world-class investor. It reflects the value of our real estate portfolio and exemplifies our dynamic asset policy, in line with the Group's strategy," stated Lola Bañón, General Manager for Carrefour Property in Spain.
In its fiscal year 2021, ended Dec. 31, 2021, CRRFY's sales increased marginally year-over-year to €78.61 billion ($86.54 billion). Its operating income rose 13.3% year-over-year to €1.91 billion ($2.10 billion). The company's adjusted net income and adjusted EPS came at €1.16 billion ($1.77 billion) and €1.47, respectively, registering increases of 14.5% and 17.2% year-over-year, respectively.
The $83.78 billion consensus revenue estimate for its fiscal year 2022, ending Dec. 31, 2022 represents marginal year-over-year growth from 2021. The $0.42 consensus EPS estimate for the current year indicates a 26.1% year-over-year rise from the prior year.
CRRFY stock has increased 15.9% in price over the past year and 17% over the past three months. The stock closed yesterday's trading session at $4.10.
CRRFY's strong fundamentals are reflected in its POWR Ratings. The stock has an overall rating of A, which equates to Strong Buy in our proprietary rating system.
The stock has an A grade for Value and Growth. It has a B grade for Stability and Sentiment. Within the A-rated Grocery/Big Box Retailers industry, it is ranked #8 of 39 stocks.
Click here to see additional component grades (Quality and Momentum) for CRRFY.
CVS shares were trading at $106.65 per share on Wednesday afternoon, down $0.58 (-0.54%). Year-to-date, CVS has gained 3.94%, versus a -6.01% rise in the benchmark S&P 500 index during the same period.
About the Author: Mangeet Kaur Bouns
Mangeet’s keen interest in the stock market led her to become an investment researcher and financial journalist. Using her fundamental approach to analyzing stocks, Mangeet’s looks to help retail investors understand the underlying factors before making investment decisions.
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