We’re in the midst of a bear market. That’s something investors haven’t seen in quite some time. While many stocks are getting crushed, it does create an opportunity for patient buyers, especially with top blue-chip stocks to buy.
While some may say it’s irresponsible to buy in an environment like this, I think it’s irresponsible for long-term investors not to be buying. At the very least, investors should be putting together a list of stocks they want to own and at what price they want to own them at.
I’ve been doing just that, accumulating a list of companies that have high-quality businesses but have seen their stock price come under pressure. In fact, let’s look at some blue-chip stocks to buy that are tapping into a hidden bull market. Or, at least a bull market that’s flying under the radar.
|JNJ||Johnson & Johnson||$165.54|
Johnson & Johnson (JNJ)
Johnson & Johnson (NYSE:JNJ) is one of the top blue-chip stocks to buy. Shares are down just 2.5% so far this year and are only 11% off the all-time high. By contrast, the S&P 500 is down about 23% so far in 2022 and is 23.5% below its all-time high.
Despite turmoil in bonds, stocks and now currencies, J&J continues to chug along well. Admittedly, this multinational company will likely experience some currency pressures that eat into its margins. However, by and large, its business has been consistent.
Estimates may call for low single digit earnings and revenue growth this year. Still, investors are accumulating this stock for its dependability and durability. Case in point, the company just announced a new $5 billion buyback plan and reaffirmed its full-year outlook.
Admittedly, there’s nothing too incredible about its outlook (as consensus estimates suggest), but to come out at a time like this and commit $5 billion to the buyback says something. That is, JNJ management is talking the talk and walking the walk.
Then there’s the fact that Johnson & Johnson has raised its dividend in 59 straight years. That’s another example of discipline and consistency.
Cardinal Health (CAH)
Healthcare is great because regardless of the economy or stock market, the population needs to take care of itself. If you have a medical emergency, you’re going to the hospital regardless of where the S&P 500 is trading.
Like JNJ, Cardinal Health (NYSE:CAH) has found itself in a favorable position. The stock hit new multi-year highs earlier this month and is down “just” 9.5% from those highs after the recent pullback. Further, shares are actually up 27.5% on the year.
Cardinal Health is fresh off a monstrous reaction to earnings, after revenue grew more than 10% year over year and beat expectations by more than $2 billion. The stock yields 2.95% and management has raised its dividend for the last 27 years.
Lastly, analysts expect about 9% revenue growth this year, and while they expect just 4% growth in FY 2024, consensus earnings expectations call for 4.3% growth this year but a huge acceleration up to 17% growth in FY 2024.
Enphase Energy (ENPH)
Enphase Energy (NYSE:ENPH) continues to deliver the goods.
While the stock market is struggling near its 2022 lows, solar stocks are, for the most part, hanging in there. In fact, most continue to trade well in what has become a rare combination of strong fundamentals and bullish technicals.
The bullish party really got started in late July, when Enphase beat on earnings and revenue estimates, while growing sales 67% year over year. Then guidance came well above analysts’ expectations. It was a lights out quarter with First Solar (NASDAQ:FSLR) delivering dazzling earnings results, as well.
As it stands now, Enphase is forecast to grow revenue 62% this year and 33.5% next year. On the earnings front, analysts expect 70% growth this year and 22% growth next year. At a time where we’re staring down a recession and barreling through a bear market, Enphase continues to generate strong growth and maintain strong technicals. Of course, it helps that the stock is up a whopping 50% year to date.
On the date of publication, Bret Kenwell 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.