Now that we have figured out those S&P 500 stocks that you should avoid, let’s consider which stocks we might actually want to buy. As I have mentioned several time in the past week, the market rally is getting mature — and like all mature entities, it’s becoming more selective. This is going to be even more true as we go through earnings season and large investors concentrate their buying on issues with the very best fundamentals. I also expect to see the focus become more on larger blue-chip companies and less on some of the frothy speculative plays we saw in favor last year.
One of the top-rated names in Portfolio Grader right now is a sweet stock! Hershey (NYSE:HSY) is one of the best-known companies in the world and features a lineup of almost iconic candy products. The company has seen sales grow at a decent rate despite the economic difficulties as consumers stayed true to their favorite brands of candy. New products are being well received in the marketplace as well. The company should see revenue growth increase steadily for the next several years, resulting in double digit earnings growth — no matter what happens in the economy. And if the economy strengthens meaningfully or one of the company’s new products becomes a huge hit, upside could be greater still.
Gilead Sciences (NASDAQ:GILD) is another “A”-rated stock that has excellent prospects right now. The company makes proprietary drugs for the treatment of viral diseases, and it’s seeing huge results from research and development efforts. The company had a new HIV drug approved in August, and the early results of testing for its new hepatitis drug have been spectacular. More than 150 million people around the world suffer from some form of hepatitis — the market for an effective drug is enormous. Once the drug is approved, some analysts think sales could be as high as $6 billion annually. The blockbuster new drugs could easily make Gilead a blockbuster stock for your portfolio.
ConAgra (NYSE:CAG) is also an “A”-rated stock that has been seeing steady improvement in recent weeks. The packaged food and consumer goods company owns a portfolio of solid well-known brands, and like Hershey, has seen consumers continue to support their favorite brands. The acquisition of RalCorp adds some faster-growing products to the mix and makes ConAgra the largest private-label food company in the country. This move will help drive revenues and profits well into 2014 and beyond as grocers look at private-label products to increase margins.
The rally is going to thin out in the weeks ahead — now is the time to position your portfolio in the best blue-chip stocks to profit from the looming changes.
Louis Navellier is the editor of Blue Chip Growth.