In order to invest with confidence, investors must be comfortable with the company’s ability to sustain earnings, debt, dividend payments and, ideally, continue to grow. In an uncertain economic environment, this can be difficult as the full impact of weakening demand and spending is not known.
It may not seem like there are many stocks that investors can buy with confidence right now. After all, S&P 500 is down 20% from last year, and economic uncertainty carries over into the new year.
Still, some blue-chip stocks are doing great, boasting healthy financials, continued growth opportunities, and reliable dividend yields despite their stock prices crashing.
Here are three stocks that look particularly strong as the bear market continues. prologue (PLD 3.37%), real estate income (O 1.09%)When Alexandria Real Estate Stocks (that is 3.18%)Here you will find details about each company and why Motley Fool contributors believe they are worth investing in.
Demand for industry leaders continues unabated
Liz Bloomer-Smith (prologue): Prologis is the world’s largest real estate investment trust (REIT) by market capitalization and the world’s largest industrial operator. Despite its huge size and excellent credit rating, the stock has suffered from investor pessimism in the market.
REITs, which own and lease about 1 billion square feet of industrial space in 19 countries, are down 30% since early last year. This is partly due to a general bear market, but mostly due to recent statements about slowing sales and the need to shrink warehouse space from some of the largest tenants. fedex When Amazonearly 2022.
Despite these statements, Prologis is doing incredible work today. As of the third quarter of 2022, the REIT’s funds under management (FFO) and his net earnings per share were up 66% and 40% year-over-year, respectively. REITs are seeing unprecedented increases in lease rates with effective rents 58% higher than last year, thanks to the continued strain on the undersupplied industrial market. And its uptime rate is over 97%. It also just completed its acquisition of previously publicly traded industrial REIT Duke Realty, which will add to earnings in the first quarter of 2023.
The company lowered its outlook for the rest of 2022 as demand weakened slightly. But even if rents don’t continue to rise, the company can still achieve healthy FFO and net income growth by simply taking out expiring leases at much higher rates today. An A rating and low debt ratios also mean the company is well equipped to weather any possible market disruptions this year and beyond.
Given its attractive 2.8% dividend yield and today’s very favorable pricing, it’s easy to see why investors are confident in the stock at the moment.
Property income has consistently outperformed for decades
mark report (real estate income): Property income is a REIT that can be included in a “widows and orphans” investment. For the most part, it’s the kind you can set up and forget as a reliable source of dividend income, with a high potential for capital appreciation over time.
The San Diego-based REIT was founded in 1969 by a couple who bought Taco Bell directly from the famous company’s founders, and has since become one of the most trusted and widely held stocks in the income investment market. I have set an enviable record. .
Over the last 53 years, Realty Income has paid out 630 consecutive monthly dividends, increasing that dividend 118-fold since going public in 1994 while delivering a total return of 5,100%. That’s about four times the S&P 500 over the same period.
This retail REIT is backed by major retailers and generates revenue from a tenant list of over 1,100 clients in all 50 states with additional locations in Puerto Rico, Spain and the United Kingdom. Its portfolio continues to grow steadily, with the announcement on December 30 that Realty Income will purchase up to 185 single-tenant properties from private REIT CIM Real Estate Finance Trust for $894 million. is also included.
If your New Year’s resolutions include confidently buying, holding, and investing in big stocks to add to over time, you’re far more than this venerable outperformer. You may do bad things.
Unique products from Alexandria Real Estate Equities help you succeed
Christy Waterworth (Alexandria Real Estate Co.): It makes sense that investors are looking for stocks that can weather an economic storm in 2022 and beyond. Many of his REITs fit the bill, but one solid foundation in my portfolio is a REIT aimed at supporting biological sciences and medical research. After all, the country is still in a pandemic and its aging population has not gotten younger.
Alexandria Real Estate Equities has everything you need to stay a hot commodity. Not only does it have a solid asset-to-liability ratio, it has made a name for itself by redesigning its research campus to facilitate collaboration among more types of companies.
At the heart of Alexandria Real Estate Equities’ business model, these campus clusters are the desired destinations for top names in biotech, pharmaceutical and other technology companies. As of the end of Q3 2022, Alexandria had an average occupancy rate of 94.3% and a weighted average remaining lease term of over seven years. Additionally, more than 87% of leasing activity in Q3 2022 was generated from the company’s existing tenant roster.
And these aren’t small potato tenants… Top names in the industry work with Alexandria Real Estate Equities to create the ideal working environment for their specific studies.Top tenants include Bristol-Myers Squibb Company, modern, Eli Lilly, Sanofi, NovartisMIT, Harvard, US Government, MerckWhen PfizerThe top 20 tenants account for 31.1% of the company’s average rental income.
Even buildings that are not yet ready for rent at the end of Q3 2022 are inundated with interest. Approximately 76% of the more than 8 million square feet of rentable space that was under construction or pre-leased during the quarter has already been leased or is in negotiation by the end of Q3 2022. Many of these projects are unprepared. For first occupancy by 2023 or 2024.
Alexandria Real Estate Equities is the epitome of a company that found a niche need and filled it, and since 1997 has done so successfully and paid solid dividends for its success.
John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Kristi Waterworth works for Alexandria Real Estate Equities, Amazon.com, and FedEx. Liz Brumer-Smith has held positions at Prologis and Realty Income. Marc Rapport has held positions at Alexandria Real Estate Equities, Amazon.com, Prologis, and Realty Income. The Motley Fool invests in and recommends Alexandria Real Estate Equity, Amazon.com, Bristol-Myers Squibb, FedEx, Merck, Pfizer and Prologis. The Motley Fool recommends Moderna stock. The Motley Fool’s U.S. headquarters has a disclosure policy.