Now is the time so start broadening out your portfolio into some more defensive stock picks. Indeed, a recent report by Bank of America shows that investors are already starting to take a potential downturn very seriously. The report notes that the top five performing sectors over the last three months have all been defensive — namely, staples, utilities, REITs, health care and telecommunications.
So with that in mind, we used TipRanks to source three very interesting defensive stock ideas. Notably, all three of these stocks have a beta under 1. This means that the security is theoretically less volatile than the market. And they all boast a ‘Strong Buy’ rating from the Street. Let’s dive in now:
1. Costco (NASDAQ:COST)
Five-star Oppenheimer analyst Rupesh Parikh (Profile & Recommendations) has just lifted his Costco price target from $210 to $250. The reason? “We believe COST remains best positioned in our entire food and grocery coverage to deliver sustainable top- and bottom-line performance” explains Parikh.
He continues: “Ongoing market share gains in the grocery category coupled with continued momentum in the company’s more discretionary offerings in a still strong consumer backdrop should help to sustain a mid-single-digit type comp trajectory.”
Most encouragingly, Parikh sees sustainable top and bottom line delivery even in a competitive retail backdrop. And it seems like the Street agrees. Right now ten analysts have published Buy ratings on the stock in the last three months.
2. T Mobile US (NASDAQ:TMUS)
T-Mobile is the third-largest wireless carrier in the US. According to top Oppenheimer analyst Timothy Horan (Profile & Recommendations), TMUS has captured 100% of the industry growth since 2013. He has just reiterated his Buy rating with a bullish $90 price target (37% upside potential).
Excitingly, Horan is optimistic about the prospects of the ‘transformational’ $26 billion TMUS/ Sprint merger going ahead. He writes “we see an 80% chance of regulatory approval given the pro-consumer/investment/jobs focus that scale drives, but with concessions.”
If the deal does go ahead, Sprint/TMUS merger can substantially increase their pro forma value through $6 billion in synergies. As we can see below, this ‘Strong Buy’ stock has racked up 8 recent buy ratings vs just 1 hold rating.
3. Boston Scientific (NYSE:BSX)
Medical device giant Boston Scientific is buzzing right now. The company has just submitted final plans for pre-market approval (PMA) for its Lotus Edge transcatheter aortic valve replacement (TAVR). This puts the company on track for a mid-2019 approval.
And at the same time, BSX also announced it is acquiring the remaining 75% of VENITI it does not already own for up to $160M. Five-star Needham analyst Michael Matson (Profile & Recommendations) believes the deal will further strengthen BSX’s Peripheral Interventions business.
“We are encouraged by the Lotus Edge news and the VENITI opportunity and we reiterate our Strong Buy rating” states Matson. He has a $39 price target on the stock (13% upside potential).
Discover Your Own Top Stock Ideas
Our new screener allows users to find investment inspiration fast. The best part about the screener, apart from the fact that (as you will see) it is very easy to use, is that alongside standard filters like market cap, sector, yield etc. users can also screen for the analyst consensus rating. You can find stocks that only have an analyst consensus rating of strong buy, or if you prefer, strong sell.
