The cooling inflation report has investors feeling confident that the Fed will get less restrictive and slow down the interest rate hikes. After the bloodbath of 2022, it is exciting to see the market moving steadily in the upward direction. The Nasdaq is up 38% this year while the S&P 500 is up 19%.
If you are looking to enter the stock market, pick stable companies that have strong balance sheets and reliable sources of revenue. The fears of recession still lie ahead of us and in such a situation, it is ideal to play safe.
If you are building a long-term investment portfolio, you need to look for companies that are resilient during economic downturns. Here are the top screaming buy stocks stocks that have a massive upside potential.
PepsiCo (PEP)
One of the hot stocks in July 2023 or in any market situation is PepsiCo (NYSE:PEP). The company can handle any economic situation and stand strong. A blue-chip name and a well-known company in the industry, Pepsi has several years of strong performance history.
PEP stock is trading at $189 right now and is very close to the 52-week high of $196. It is up 12% over the past year and has generated 65% returns in the past five years.
In the recent quarterly results announced last week, the company reported a big jump in profits. It saw a 10% growth in revenue which hit $22.3 billion and the profit reached $2.7 billion, nearly doubling since the same quarter last year.
The management also raised the full-year guidance and now expects the revenue to grow 10% from the previous forecast of 8%. It also saw the organic revenue grow 14%, marking the seventh consecutive quarter of double-digit organic revenue growth.
PepsiCo had to raise prices to handle inflation. While the company saw a dip in the number of products sold, consumers still chose to stay with the brand. This is one company that never disappoints and it is also a dividend aristocrat. It has a dividend yield of roughly 2.70% and pays out a quarterly dividend of $1.265.
The company has also introduced a range of new products which will help increase the market share in the coming quarters. PEP is one of the best value stocks in July.
A market leader, the company dominates in the food and beverage space and is consistent with the dividends. The stock might look expensive today but its growth potential is massive. This is also one stock that should be held forever. The recent pullback in the stock is a good chance to add it to your portfolio.
Visa (V)
If there is one stock that should be a part of your portfolio for the long term, it is Visa (NYSE:V). A leading payment processing network, the company has a presence across 200 countries and serves more than 100 merchants.
With more people moving towards cashless payments, Visa has become a household name and when it comes to competition, it is hard to beat this company. It has a solid history, stable financials, and a strong market position which makes it one of the best today.
One thing to keep in mind is that the company will continue to generate revenue no matter the economic condition. Since Visa operates across the globe, it will not suffer when the economy of a particular country is down.
While the company looks promising, V stock isn’t cheap. It is trading close to its 52-week high right now, but buying the stock could be a smart move. With the earnings season upon us and the economy improving, there is a higher chance of Visa stock moving higher. It is exchanging hands at $239 and is up 15% year-to-date. It is one of the must-buy stocks right now.
In the recent quarter, the company reported a revenue of $8 billion which is up 11% year over year. It also acquired a Brazilian fintech company Pismo for $1 billion. This move will help Visa expand its position in Brazil while the company already serves Asia Pacific, Latin America, and the European markets.
It took many years for Visa to reach here and it has been showing steady growth over time. That said, the company also has a dividend yield of 0.74% and pays a quarterly dividend of $0.45. Visa is a defensive stock, and while it may be expensive today, it is still a strong buy.
Airbnb (ABNB)
Airbnb (NASDAQ:ABNB) is a renowned name in the lodging industry and it has transformed the way we travel. The company made short-term rentals popular and it has enjoyed impressive booking volumes.
Airbnb has the potential to disrupt the industry, and the company has very little competition. The loading industry leader will soon capture a larger share of traditional hotels. Besides letting the hosts earn money, Airbnb offers a unique way of holidaying. It is a clear leader in the travel industry right now. One good reason for investing in the company is its low operational costs since the hosts handle everything for them.
It has managed to adapt to the changing consumer needs and offers longer stays which many hotels cannot offer. The travel industry is undergoing a period of transition and the boom due to revenge travel is now fading.
However, the recent summer holiday season was strong and it could lead to impressive quarterly revenue numbers for the company. ABNB is one of the top stocks to buy now.
In the first quarter, it reported a revenue of $1.82 billion and a net profit of $117 million. It expects revenue of $2.42 billion in the second quarter. ABNB stock is trading at $145 today and it isn’t cheap but there is ample upside potential. The stock has been up 71% year to date and I believe the upside momentum is set to continue.
Airbnb does not want to limit itself to holiday bookings and is now working with AI to enhance the user experience. Its margins are set to expand in the long term and this will reflect in the bottom line.
On the date of publication, Vandita Jadeja did not hold (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.
