Runaway inflation was a serious problem in 2022. High inflation coupled with rising Treasury yields around the world and a Federal Reserve that tried to rein in inflation by hiking key interest rates led to a very bad year for the U.S. and the stock market.
In 2023, inflation began to cool off and the Fed stopped raising key interest rates in the latter half of the year. However, there were still plenty of issues for Wall Street to contend with, like surging Treasury yields, the U.S. government’s spending spree, rising unemployment, as well as tensions boiling over in the Middle East.
Unfortunately, the problems of 2023 – especially inflation – will likely remain a thorn in investors’ sides in 2024, but the good news is there is a way to not only protect your portfolio, but to profit in the current environment.
All you need to do is invest in fundamentally superior stocks. Here’s why…
Historically, growth stocks and dividend stocks are your best defense against rising inflation. The reality is that stocks are great inflation hedges because they represent ownership in real businesses.
Even better, great businesses function as inflation “pass through” vehicles. An inflation “pass through” vehicle is a business that “passes along” the price increases that result from inflation.
The nominal price of inputs and product prices might change, but the businesses’ profit margins do not. They simply “pass through” the inflation, which allows their profits and market values to rise along with prices.
Of course, you don’t want to invest in just any stock. You want the best of the best… the companies whose growth won’t be curtailed by inflation and will continue to boast strong earnings and sales growth.
In this report, I’m going to show you five companies that have emerged as the crème de la crème that you should buy in 2024.
With strong sales growth and profits ahead, these stocks are must-haves for your portfolio as we navigate our way through the year…
Top Stock No. 1: Dorian LPG Ltd.
Dorian LPG Ltd. (LPG) operates a fleet of “very large gas carriers,” or VLGCs, that primarily haul liquified petroleum gas around the world. The company’s fleet consists of 22 VLGCs, each with the capacity to carry 1.8 million cubic meters (cbm). Dorian LPG has offices in the U.S., U.K., Greece and Denmark, and it partners with several big-name oil companies, including BP, Petrobras and Shell.
Due to record natural gas production and steadily rising crude oil production, the U.S. is reasserting its energy clout and helping the world break away from Russian crude oil. In fact, the U.S. recently reported record energy exports.
In January 2023, the U.S. exported 1.53 million barrels of crude oil per day – and there weren’t any releases from the Strategic Petroleum Reserve during this time. As the U.S. continues to ship more crude oil, as well as natural gas, overseas, there’s one industry that should reap the rewards: tanker and liquified natural gas (LNG) shipping companies.
I should also add that Bloomberg reported that there is a lack of liquified natural gas to satisfy world demand in a transition to a green economy. This essentially means that Dorian LPG should be able to charge high day rates for its ships. There is no doubt that burning natural gas is cleaner than burning coal, but global coal consumption continues to steadily rise, since emerging markets like China, India, Indonesia, Malaysia and Vietnam rely on coal for cheap electricity.
Given this, Dorian LPG should benefit immensely. For full-year 2024, analysts expect earnings of $6.02 per share and revenue of $520.39 million, up from earnings of $4.22 per share and revenue of $389.75 million a year ago.
Top Stock No. 2: NVIDIA Corporation
NVIDIA Corporation (NVDA) is a leading computer graphics company – and it’s been in the business for more than two decades. The company first invented the graphic processing unit (GPU) back in 1999. From video games to professional visualization, data center and automotive applications, NVIDIA’s graphics cards enhance processing capability for its users’ computers.
Today, NVIDIA employs more than four million developers who create thousands of applications for advanced computing. It owns a portfolio of more than 8,000 active patents, which is the largest portfolio of its kind. So, it’s no surprise that NVIDIA’s technologies have been utilized by more than 40,000 companies, including 15,000 startups, since its founding 24 years ago.
But NVIDIA refuses to rest on its laurels. The company continues to innovate, and since 2014, the company has shifted its focus to five major markets – gaming, professional visualization, data centers, auto and artificial intelligence (AI).
Today, NVIDIA is at the forefront of the AI movement. In fact, NVIDIA dominates the AI chips that are used in everything from data analytics to autonomous vehicles, from data centers to supercomputers and from medical devices to cybersecurity. The opportunities are virtually endless!
So, in my opinion, AI is hotter than hot – and given its strong earnings and sales, NVIDIA is the clear leader.
For full-year 2025, analysts expect earnings of $16.07 per share on revenue of $77.86 billion, up from earnings of $10.02 per share and revenue of $51.66 billion a year ago.
Top Stock No. 3: Novo Nordisk A/S
Novo Nordisk A/S (NVO) develops treatments to combat diabetes, obesity and other chronic illnesses, as well as rare blood and rare endocrine diseases.
With headquarters in Copenhagen, Denmark, Novo Nordisk operates 80 offices around the world, and its products are available in 170 countries. Breaking it down further, the biotech company has 16 production sites in nine countries, as well as 10 research and development facilities in five countries.
Novo Nordisk has dominated the diabetes treatment market, as its main goal is to develop a cure for type 1 diabetes and help prevent type 2 diabetes and obesity. To do this, Novo Nordisk provides care to more than 30,000 children with type 1 diabetes through its Changing Diabetes in Children program, and it aims to help more than 100,000 children by 2030. It also slashed the cost of insulin in low- and mid-income countries.
In regard to treatment options, Novo Nordisk offers a variety of insulin pens for folks to administer their diabetes medication, as well as provides injection needles and growth hormone pens. The company has also developed several medications for the treatment of obesity, diabetes, hemophilia and growth disorders, as well as hormone replacement therapies.
You’ve likely seen commercials for one of Novo Nordisk’s diabetes treatments, Ozempic. The company has experienced increased demand for the treatment, which should boost its top and bottom lines growth this year.
For full-year 2024, analysts expect earnings of $2.63 per share on revenue of $37.89 billion, up from earnings of $2.22 per share and revenue of $31.83 billion in full-year 2023.
Top Stock No. 4: PBF Energy, Inc.
PBF Energy, Inc. (PBF) is a leading refiner and provider of petroleum products in the U.S. and Canada. The company operates six refineries in the U.S.: Delaware City, Delaware (180,000 bpd); Paulsboro, New Jersey (105,000 bpd); Toledo, Ohio (180,000 bpd); New Orleans, Louisiana (185,000 bpd); Torrance, California (166,000 bpd); and Martinez, California (157,000 bpd).
Through these facilities, PBF Energy produces gasoline, diesel fuel, jet fuel, kerosene, liquified petroleum gases (LPGs), asphalt, coke, sulfur, distillates, specialty chemicals, petrochemicals, heating oil and lubricants. PBF Energy also operates logistics assets at each refinery, including pipelines, barges, tankers, trucks, rail, ships and distribution terminals, to ensure the products reach its customers.
For full-year 2024, analysts expect earnings of $7.43 per share on revenue of $36.43 billion.
Top Stock No. 5: Super Micro Computer
Founded back in 1993, Super Micro Computer, Inc. (SMCI) has been at the forefront of technological change, developing a lot of firsts in the industry: the very first x86 server boards based on Orion semiconductors, the first server boards to support Intel Pentium processors, the first redundant cooling power supply, the first dual Intel Xeon server – just to name a few!
Today, Super Micro Computer is well-known as a global leader in high-performance server technology solutions. The company continues to provide a wide range of servers, storage, motherboards, workstations and networking solutions, as well as server management software. Super Micro Computer’s solutions are utilized in several markets, including artificial intelligence, 5G, Internet of Things (IoT), data centers, cloud computing, big data, enterprise, embedded and edge computing.
While the company’s main headquarters are based in the U.S., Super Micro Computer has operations in more than 100 countries around the world. Primarily, these operations are in the U.S., Asia and Europe. And the company has a three-million-square-foot global manufacturing footprint.
SMCI is also a well-known, global leader in high-performance server technology solutions. The company primarily provides a wide range of servers, storage, motherboards, workstations and networking solutions, as well as server management software. And like NVIDIA, Super Micro Computer is well-positioned to profit from the rising demand for AI technologies.
For full-year 2024, analysts expect earnings of $16.97 per share on revenue of $10.1 billion, up from earnings of $11.81 per share and revenue of $7.12 billion in full-year 2023.
There’s Always a Bull Market Somewhere
There’s always a bull market somewhere – and right now the bulls are piling into fundamentally superior stocks that will profit from runaway inflation.
The five top stocks we discussed today fit this description to a “T” and are great bets for your money in 2024.
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