Wall Street’s robust companies potentially offer strong returns for retirement portfolios. Such retirement stocks have a history of consistent performance and strategic positioning in their respective industries, making them attractive options for those seeking to secure their financial future.
Planning for retirement can be daunting, but investing in the right stocks can help ensure financial stability and growth during your golden years. By investing in these strong stocks early on, you can take advantage of their impressive fundamentals and long-term growth prospects. Now, dive in and discover how these three retirement stocks can help make your golden years gleam.
Adobe (ADBE)
The software giant Adobe (NASDAQ:ADBE) is the first company among today’s retirement stocks. Adobe’s industry-standard design programs, like Photoshop and Acrobat, have been household names for decades. Today, ADBE offers a cloud-based subscription model for its expanding creative, marketing and analytics software range. Such leadership positions it for long-term growth in the digital media landscape.
Adobe’s first quarter 2024 earnings report showed total revenues of $5.18 billion, reflecting a year-over-year (YOY) growth of 11%. This increase was primarily driven by the strong performance of its Digital Media and Digital Experience segments. Adjusted diluted earnings per share (EPS) came in at $4.48.
Recently, Adobe has announced the integration of Frame.io into Creative Cloud, enhancing video collaboration capabilities. This integration allows users to seamlessly review, share and collaborate on video projects within Adobe Premiere Pro and After Effects, streamlining workflows and boosting productivity for creative professionals.
Despite these positive developments, ADBE stock is down 20% year-to-date (YTD). Shares are changing hands at 25.8 times forward earnings and 11.1 times sales, reflecting investor confidence in the company’s growth prospects. Analysts also remain optimistic, with a 12-month median price forecast at $640, suggesting a 34% upside potential.
Broadcom (AVGO)
We continue our discussion of retirement stocks with the semiconductor behemoth Broadcom (NASDAQ:AVGO). The company’s products cater to critical functions in communications, networking, industrials, computing, storage and wireless markets. Considering its strong market position, consistent innovation and track record of financial performance, AVGO could be a tech stock to add to retirement portfolios.
Broadcom’s growth strategy is heavily anchored in strategic acquisitions that complement and expand its core business segments. The recent acquisition of VMware is a prime example of the significant bolstering of its infrastructure software segment. This acquisition diversifies Broadcom’s revenue streams. It also positions it at the forefront of cloud and enterprise software solutions, sectors to benefit from continued digital transformation trends.
In March, Broadcom released first quarter 2024 results, announcing revenues of $12 billion, a 34% increase YOY. This growth was partly driven by a 4% increase in semiconductor solutions revenue, which reached $7.4 billion. A staggering 153% increase in infrastructure software revenue, which soared to $4.6 billion, largely due to the integration of VMware, was also helpful.
Since the start of the year, AVGO stock has gained nearly 25% and offers a 1.5% dividend yield. Shares are currently trading at 29 times forward earnings and 15.9 times sales. With a median 12-month price forecast of $1,572, AVGO stock has an upside potential of 13%.
General Motors (GM)
We conclude our discussion on retirement stocks with the automotive giant General Motors (NYSE:GM). Its diversification efforts, including strategic investments in electric vehicles (EVs) and autonomous driving technology, highlight GM’s commitment to leading the automotive transformation.
The automaker reported strong first-quarter fiscal 2024 metrics and raised its full-year guidance. Revenue increased 8% YOY to $43 billion. Despite higher interest rates, GM’s sales and pricing contributed to robust profit margins. U.S. retail sales grew 6% without resorting to significant price cuts and incentives. Meanwhile, adjusted EPS jumped 19% YOY to $2.62.
GM’s recent focus on EVs and autonomous vehicles has become a key growth driver, suggesting strong upside potential for its long-term profit prospects. The automaker reported significant progress with its Ultium EV platform. Production increased, and battery costs declined, leading to improved profitability. Meanwhile, the company focuses on connected vehicle software and subscription services to unlock recurring revenue opportunities beyond traditional vehicle sales.
Since January, GM stock has returned 18%. Additionally, it offers a modest 1.1% dividend yield. The company’s forward price-to-earnings (P/E) ratio is an attractive 4.9x, and its trailing price-to-sales ratio (P/S) is just 0.3x, presenting a bargain valuation for long-term investors. Finally, analysts have set a 12-month median price forecast of over $51, indicating an upside potential of over 21% from current levels.
On the date of publication, Tezcan Gecgil 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.
