Dividend Stocks
  • Planning for retirement can feel overwhelming in bear markets, but these seven retirement stocks can provide a boost to savings.
  • Caterpillar (CAT): The heavy equipment manufacturer is enjoying strong demand for products.
  • Constellation Brands (STZ): Introduced a new line of pre-mixed cocktails for consumers entertaining at home.  
  • Caterpillar (CAT): The heavy-equipment manufacturer is enjoying strong demand for its portfolio.
  • Enbridge (ENB): The fee-based business generates roughly $2 billion in excess cash flows.
  • GSK (GSK): The pharma giant is one step closer to introducing a vaccine for respiratory syncytial virus (RSV).
  • Johnson & Johnson (JNJ): The cash cow could appeal to investors who expect the healthcare industry to outperform the broader market in recessionary times.
  • Oracle (ORCL): The acquisition of a healthcare data management company is likely to contribute to top line growth.
  • State Street (STT): Was recently selected to administer a new Ethereum (ETH-USD) fund in Australia.

Retirement stocks are at the center of attention for millions of investors. Rising global tensions, declining markets and the expected recession have investors looking more closely at their longer-term saving plans, be it 401(k)s or IRAs.

According to Alicia Munnell, director of the Center for Retirement Research at Boston College, the current selloff has erased around $3 trillion from retirement accounts stateside. This year’s declines on Wall Street remind us the importance of choosing robust stocks for retirement accounts.

Many widely-followed retirement stocks pay stable dividends. According to Barron’s, “well-chosen dividend stocks can help mitigate the effects of market downturns or add juice to rallies, delivering quarterly income that cuts losses and amplifies gains. They can also be a hedge against inflation.”

Current bear market conditions present the perfect opportunity to invest in retirement stocks while they’re trading at bargain valuations. If history is any guide, the market will inevitably rebound in future months.

With that information, here are seven retirement stocks to buy in July:

CAT Caterpillar $183.20
STZ Constellation Brands $245.07
ENB Enbridge $42.61
GSK GSK $43.94
JNJ Johnson & Johnson $177.39
ORCL Oracle $69.40
STT State Street $64.05

Caterpillar (CAT)

Source: Shutterstock

52-week range: $176.02 – $237.90

Caterpillar (NYSE:CAT) is the world’s leading producer of construction and mining equipment, as well as engines, turbines and locomotives. The company maintains 18 brands under its belt, with more than 500 sales, services and research and development facilities around the world.

In late April, Caterpillar reported Q1 financials. Revenue increased 14% year-over-year (YOY) to $13.6 billion. Adjusted profit per share was $2.88, compared to $2.87 the year before. Operating cash flow was $300 million.

When the iconic brand puts out Q2 results in July, Wall Street will be keeping a close eye on the effects of rising prices and supply-chain constraints. Many expect Caterpillar to keep a tab on costs and maintain strong margins.

Recently, the company announced that it will be moving its global headquarters from Deerfield, Illinois, to its existing office in Irving, Texas. According to CEO Jim Umpleby, the move is in the “best strategic interest of the company” and will support “Caterpillar’s strategy for profitable growth.”

CAT stock has lost 11% year-to-date (YTD). Shares are trading at 15 times forward earnings and 2 times sales. The dividend yield is 2.6%. The 12-month median forecast stands at $230.

Constellation Brands (STZ)

Source: ShinoStock / Shutterstock.com

52-week range: $207.35 – $261.52

Drinks giant Constellation Brands (NYSE:STZ) produces beers, wines and spirits. Its well-known brands include Corona, Modelo, Pacifico, Ruffino and Svedka. The manufacturer maintains breweries in Mexico and wineries in California, Italy and New Zealand, as well as spirit distilleries stateside.

In early April, Constellation released Q4 FY22 results. Net sales totaled $2.1 billion, an 8% increase YOY. Diluted earnings per share (EPS) was $2.07, compared to $1.95 the year before. Cash and equivalents totaled $199.4 million.

Constellation Brands recently launched the “Next Round Cocktails” line, its first ready-to-drink boxed wine cocktails. Management aims to cater to those who prefer to drink at home rather than go out. Wall Street will be looking at how sales will come in future quarters.

Since January, STZ stock has fallen 3%. Forward P/E and P/S numbers are 22 and 5, respectively. The dividend yield is 1.4%. Lastly, the 12-month median forecast stands at $271.

Enbridge (ENB)

Source: JHVEPhoto / Shutterstock.com

52-week range: $36.21 – $47.67

Canada-based Enbridge (NYSE:ENB) operates oil and natural gas pipelines and has a natural gas utility operation, as well as renewable energy assets. It transports a quarter of total crude oil production in North America.

The midstream operator released Q1 metrics on May 6. Revenue grew 24% YOY to $11.7 billion. Adjusted earnings came in at 65 cents per share, compared with 63 cents a year ago.

Customers pay Enbridge for the use of its pipelines. Thus, it runs a fee-based business shielded from volatile commodity prices.

Therefore, its cash flows are resilient to energy price swings. Enbridge generates roughly $2 billion in excess cash flows from its carbon operations and uses it to build a renewable power business.

The Dividend Aristocrat currently generates a fat 6.6% dividend yield supported by 27 years of annual dividend hikes.

So far in the year, ENB stock is up 9%. Shares are trading at 18 times forward earnings and 2.2 times sales. Analysts’ 12-month median price forecast for Enbridge stock stands at $47.14.


Source: Willy Barton / Shutterstock.com

52-week range: $37.80 – $46.97

Global pharma giant GSK (NYSE:GSK) manufactures more than 100 prescription medications and vaccines. It is highly regarded for its work in vaccine development.

Prior to Covid-19, its market share of the global vaccine market was well over 30%. It currently has a “strong pipeline of 21 vaccines and 43 medicines.”

In late April, GSK reported Q1 earnings. Revenue was $11.9 billion, representing a 32% increase YOY. Adjusted EPS was 40 cents, compared to 28 cents the year before. Free cash flow (FCF) was 2.1 billion pounds.

Recently, the company detailed positive results from a phase-3 trial for a vaccine for respiratory syncytial virus (RSV). The results show significant efficacy with no unexpected safety concerns. If approved, it will be the first vaccine to be used to combat RSV in adults aged 60 years or over.

GSK stock has declined around 1% YTD. Shares are trading at 14 times forward earnings and 2.5 times sales. The dividend yield is 4.6%. Wall Street’s 12-month median forecast stands at $45.15.

Johnson & Johnson (JNJ)

Source: Alexander Tolstykh / Shutterstock.com

52-week range: $155.72 – $186.69

Johnson & Johnson (NYSE:JNJ) is one of the most diverse global healthcare conglomerates. Its business covers lucrative areas within the healthcare industry, including pharmaceutical drugs, consumer products and medical devices.

The group issued Q1 results on April 19. Revenue increased 5% YOY to $23.4 billion. Adjusted earnings came in at $2.67 per diluted share, up 3.1% from $2.59 per diluted share a year ago.

Its pharmaceutical segment sales jumped 6.3% YOY to $12.9 billion, generating the majority of sales growth and operating margins. The healthcare stock boasts over a dozen blockbusters in its portfolio, including immunology drug Stelara and antipsychotic drug franchise Invega.

JNJ also has 94 projects in clinical development or the registration phase. Meanwhile, management will spin off its consumer products segment by late 2023. Johnson & Johnson then can focus on the higher-margin pharmaceuticals and medical devices segments.

In April, this Dividend King increased its base annual dividend for the 60th consecutive year. JNJ stock currently generates a 2.5% dividend yield.

Despite market volatility, JNJ shares are up 3% YTD. The stock changing hands at 18 times forward earnings and 5 times sales. Wall Street’s 12-month median price forecast for Johnson & Johnson stock is at $187.

Oracle (ORCL)

Source: Jonathan Weiss / Shutterstock.com

52-week range: $63.76 – $106.34

Enterprise software giant Oracle (NYSE:ORCL) offers integrated suites of applications plus autonomous infrastructure in the Oracle Cloud. Another notable product is the Oracle Database, used for online transaction processing and data warehousing.

By net sales, Oracle trails Microsoft (NASDAQ:MSFT) as the second largest software company. Meanwhile, Oracle’s share of the customer relationship management (CRM) market is over 5%.

In mid-June, Oracle presented Q4 FY22 metrics. Total revenue was $11.8 billion, up 10% in constant currency. Diluted EPS was $1.54, unchanged from the year before. Cash and equivalents totaled $21.4 billion.

Recently, the company completed the acquisition of Cerner, which offers digital information systems for healthcare providers. Together, the two companies’ systems should lower administrative costs and improve patient outcomes and privacy.

ORCL stock has lost 21% YTD. Forward P/E and P/S numbers are 14 and 5, respectively. The dividend yield is 1.9%. Finally, the 12-month median forecast stands at $88.

State Street (STT)

Source: Shutterstock

52-week range: $61.29 – $104.87

State Street (NYSE:STT) provides investment management, fund administration, research and financial data analytics for institutional investors. InvestorPlace readers likely know that State Street Global Advisors, the company’s investment management division, is one of the most important asset managers. 

In mid-April, State Street released Q1 financial results. Total fee revenue was $2.6 billion, representing a 4% increase YOY. Diluted EPS was $1.57, compared to $1.37 a year ago.

State Street announced in May that it was appointed by K2 Asset Management as the fund administrator for the Cosmos-Purpose Bitcoin Access ETF. It is Australia’s first cryptocurrency exchange-traded fund (ETF), backed by physically-settled Bitcoin (BTC-USD).

Furthermore, in June, State Street expanded its partnership with K2 Asset Management. Now it is the fund administrator in Australia for the new Cosmos-Purpose Ethereum Access ETF, giving Australian investors access to the world’s first physically-settled Ethereum (ETH-USD) ETF.

So far in 2022, STT stock has lost around a third of its value. Meanwhile, the dividend yield is 3.5%. Shares are trading at 8 times forward earnings and 2 times sales. Wall Street’s 12-month median forecast stands at $88.

On the date of publication, Tezcan Gecgil, Ph.D., 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.

Tezcan Gecgil has worked in investment management for over two decades in the U.S. and U.K. In addition to formal higher education in the field, she has also completed all 3 levels of the Chartered Market Technician (CMT) examination. Her passion is for options trading based on technical analysis of fundamentally strong companies. She especially enjoys setting up weekly covered calls for income generation.

Articles You May Like

7 Consumer Staples Stocks to Buy at a 52-Week Low in July
3 Robotics Stocks to Buy Now: Q3 Edition
Overpriced and Overcooked: Sell Chipotle Stock Now
IMF sees ‘bumps’ in path to lower inflation
3 Consumer Tech Powerhouses to Buy in July