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Beta is a measure of a stock's systematic risk or volatility in comparison to the overall market. The S&P 500 is often used as the benchmark, with a beta of 1.0 representing the market average.
A beta greater than 1.0 indicates that a stock is more volatile than the market, while a beta less than 1.0 suggests the opposite. Essentially, low-beta stocks provide a higher level of ‘defense,’ whereas high-beta stocks are known for their higher returns, or ‘offense.’
By adding low-beta stocks to a portfolio, investors can help balance out their risk profile, helping during intense volatility spikes like the market has recently witnessed.
Over recent months, several low-beta stocks – Northrop Grumman , Pfizer, and Kimberly-Clark– have enjoyed positive earnings estimate revisions, landing them into favorable Zacks Ranks.
For those looking for a higher level of defense, let’s take a closer look at each.
Pfizer Bounces Back Big
Pfizer shares have been quietly strong off their 2024 lows in late April, gaining more than 20% since. Analysts have taken their expectations higher across the board, landing the stock into a Zacks Rank #2 (Buy).
The stock has been shoved to the side in the post-COVID world, with weakening quarterly results regularly causing post-earnings pressure. Still, the trend has seemingly shifted over recent releases, with the stock catching a nice boost post-earnings following both of its last two prints.
Regarding the latest release, non-COVID products saw a nice 11% year-over-year boost in operating revenue. The company also raised its adjusted EPS outlook for the year while maintaining all previous guidance.
In addition, the stock could attract income-focused investors, with shares currently yielding a solid 5.5% annually. Pfizer paid out $2.4 billion in dividends throughout its latest period, with the company’s 3% five-year annualized dividend growth rate further reinforcing a shareholder-friendly nature.
Northrop Grumman Raises Outlook
Similar to PFE, Northrop Grumman saw its shares make a strong positive move following the release of its latest quarterly results, up nearly 15% just over the last month. The stock presently sports a Zacks Rank #2 (Buy), with earnings expectations moving higher following a guidance upgrade in the mentioned release.
The company maintains a bright internal outlook, with CEO Kathy Gordon stating, “We are laser focused on performance and continue to expand profitability through the deliberate actions we are taking. With strong support for our programs, growing global orders for our products, and solid execution in our business, we are increasing our revenue and EPS guidance for the year.”
Kimberly-Clark Sees Profitability Boost
KMB shares have delivered a strong performance year-to-date, gaining more than 15%. The company carries a defensive nature thanks to its placement in the consumer staples sector, as these companies’ products have an advantageous ability to generate consistent demand in the face of many economic situations.
The stock sports a Zacks Rank #2 (Buy), with earnings expectations for its current fiscal year drifting notably higher over the last month following a guidance upgrade.
Cost management practices have aided the company’s profitability in a big way, with adjusted EPS of $1.96 throughout its latest quarter seeing a 20% climb year-over-year. Margin expansion has also kept investors happy.
Bottom Line
During periods of heightened volatility, low-beta stocks can provide a valuable layer of defense and a more balanced risk profile.
And over recent months, several low-beta stocks – Northrop Grumman , Pfizer , and Kimberly-Clark – have enjoyed positive earnings estimate revisions, landing them into favorable Zacks Ranks.
Why Haven’t You Looked at Zacks' Top Stocks?
Since 2000, our top stock-picking strategies have blown away the S&P's +7.0 average gain per year. Amazingly, they soared with average gains of +44.9%, +48.4% and +55.2% per year.
Today you can access their live picks without cost or obligation.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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Zacks Investment Ideas feature highlights: Northrop Grumman, Pfizer and Kimberly-Clark
For Immediate Release
Chicago, IL – August 6, 2024 – Today, Zacks Investment Ideas feature highlights Northrop Grumman (NOC - Free Report) , Pfizer (PFE - Free Report) , and Kimberly-Clark (KMB - Free Report) .
Volatility Spikes: 3 Low Beta Stocks to Buy
Beta is a measure of a stock's systematic risk or volatility in comparison to the overall market. The S&P 500 is often used as the benchmark, with a beta of 1.0 representing the market average.
A beta greater than 1.0 indicates that a stock is more volatile than the market, while a beta less than 1.0 suggests the opposite. Essentially, low-beta stocks provide a higher level of ‘defense,’ whereas high-beta stocks are known for their higher returns, or ‘offense.’
By adding low-beta stocks to a portfolio, investors can help balance out their risk profile, helping during intense volatility spikes like the market has recently witnessed.
Over recent months, several low-beta stocks – Northrop Grumman , Pfizer, and Kimberly-Clark– have enjoyed positive earnings estimate revisions, landing them into favorable Zacks Ranks.
For those looking for a higher level of defense, let’s take a closer look at each.
Pfizer Bounces Back Big
Pfizer shares have been quietly strong off their 2024 lows in late April, gaining more than 20% since. Analysts have taken their expectations higher across the board, landing the stock into a Zacks Rank #2 (Buy).
The stock has been shoved to the side in the post-COVID world, with weakening quarterly results regularly causing post-earnings pressure. Still, the trend has seemingly shifted over recent releases, with the stock catching a nice boost post-earnings following both of its last two prints.
Regarding the latest release, non-COVID products saw a nice 11% year-over-year boost in operating revenue. The company also raised its adjusted EPS outlook for the year while maintaining all previous guidance.
In addition, the stock could attract income-focused investors, with shares currently yielding a solid 5.5% annually. Pfizer paid out $2.4 billion in dividends throughout its latest period, with the company’s 3% five-year annualized dividend growth rate further reinforcing a shareholder-friendly nature.
Northrop Grumman Raises Outlook
Similar to PFE, Northrop Grumman saw its shares make a strong positive move following the release of its latest quarterly results, up nearly 15% just over the last month. The stock presently sports a Zacks Rank #2 (Buy), with earnings expectations moving higher following a guidance upgrade in the mentioned release.
The company maintains a bright internal outlook, with CEO Kathy Gordon stating, “We are laser focused on performance and continue to expand profitability through the deliberate actions we are taking. With strong support for our programs, growing global orders for our products, and solid execution in our business, we are increasing our revenue and EPS guidance for the year.”
Kimberly-Clark Sees Profitability Boost
KMB shares have delivered a strong performance year-to-date, gaining more than 15%. The company carries a defensive nature thanks to its placement in the consumer staples sector, as these companies’ products have an advantageous ability to generate consistent demand in the face of many economic situations.
The stock sports a Zacks Rank #2 (Buy), with earnings expectations for its current fiscal year drifting notably higher over the last month following a guidance upgrade.
Cost management practices have aided the company’s profitability in a big way, with adjusted EPS of $1.96 throughout its latest quarter seeing a 20% climb year-over-year. Margin expansion has also kept investors happy.
Bottom Line
During periods of heightened volatility, low-beta stocks can provide a valuable layer of defense and a more balanced risk profile.
And over recent months, several low-beta stocks – Northrop Grumman , Pfizer , and Kimberly-Clark – have enjoyed positive earnings estimate revisions, landing them into favorable Zacks Ranks.
Why Haven’t You Looked at Zacks' Top Stocks?
Since 2000, our top stock-picking strategies have blown away the S&P's +7.0 average gain per year. Amazingly, they soared with average gains of +44.9%, +48.4% and +55.2% per year.
Today you can access their live picks without cost or obligation.
See Stocks Free >>
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.