10 Hot Stocks for 2023

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  • Sean Williams is a respected authority on the stock market with over two decades of experience.
  • These stocks have been hand-picked to provide safety and stability in an uncertain environment.
  • The list includes stocks from various industries to ensure diversity and risk mitigation.
  • Each stock has the potential for significant growth, making now an ideal time to invest.

Investing for uncertain times can be made safe and profitable with pre-selected stocks across various industries for long-term potential.

The stock market has been wild in the past few years. From the pandemic, recovery, inflation, and the threat of recession, it’s hard to know what to buy in such an uncertain environment. 

Fortunately, there is always something for investors to buy. In a downturn, there are safe places in the market to hide out and stocks ready to rebound. The following list features great investing ideas for 2023 that will not only keep your money safe but may provide a robust return. Sean Williams of the Motley Fool recommended the following. 

Enterprise Products Partners (NYSE: EPD)

Enterprise Products Partners is ideal for investors looking for high-yielding stocks that they can use to compound their investments. This oil and gas company yields an astounding 7.5% and has raised its base payout for over two decades. 

Although it’s wise to be careful about energy companies during a coming recession, EPD has several things in its favor, given the uncertainty about oil and gas prices. It has a long tradition of stability, and its fixed-fee and volume-based contracts can take the edge off uncertainty and fluctuating gas prices. Also, the high dividend will pay investors while they wait. 

MasterCard (NYSE: MA)

Mastercard has been a port in a financial storm. Millions of consumers have relied on this credit card company for decades, and for a good reason–it is a solid, stable company that is almost inflation-proof. 

Even with higher consumer prices, people will still need to buy things, and increasingly, consumers are abandoning cash and paying for their groceries with credit cards. The company is also bolstered by its prudence. Unlike other credit card companies, Mastercard has stayed out of the loan business. This has allowed it to avoid the costs of loan defaults and remain stable, even in tough times. 

NextEra Energy (NYSE: NEE)

Utilities are another consumer product that will still be needed, even in an economic slowdown. Although people vow to reduce their electricity when bills go higher, they seldom do to any significant degree. This is what makes utility stocks an essential part of every portfolio. 

NextEra Energy’s commitment to alternative energy sets it apart from other utilities. It stands out from other utilities in its solar and wind power use. This isn’t just good for the environment but will also benefit NextEra Energy as oil and gas prices rise. 

United Health Group (NYSE: UNH)

This insurance company may not be a fast grower, but it has provided a consistent return for its investors for decades. The advantage of insurance is that it can easily compensate for payouts with higher premiums for customers. This means more stability, which is what any investor needs in uncertain economic times. 

What makes United Health Group a standout insurance company is its subsidiary Optum which provides software to the insurance company. Its growth rate is double that of the insurance sector and will continue to grow in the coming years. 

Paypal Holdings (NASDAQ: PYPL)

Paypal may be one of the oldest fintech stocks, but it’s certainly not an old hat. In the past few years, user engagement has increased significantly, and this trend has remained steady since the pandemic’s end. 

With more consumers shopping online for groceries and other necessities, it will perform well even with increasing economic pressure. Paypal executives are scrupulous when cutting costs and proving top service affordably. In addition, its stock buybacks bring its stock prices up and reward investors handsomely. 

Alex Sirois of Investor Place recommends the following stocks.

Apple (NASDAQ: AAPL)

Apple, like the fruit, is still sweet. Even with a staggering decline in the tech industry, Apple is still afloat and is the best stock in an ailing sector. The Nasdaq fell 33% in 2022, but Apple declined 23% year to date. Despite a record quarter, this indicated the problem was with sector weakness and not Apple in particular. 

Apple is an outstanding stock on the decline because it is a bellwether for the tech sector, yet it doesn’t fall as far as other tech stocks. Its customers are loyal (it isn’t jokingly called a cult for nothing), which is advantageous for stocks. 

ASML Holding (NASDAQ: ASML)

This is another tech stock that has faced a decline in 2022 but may be worth buying on the fall. ASML is a chip stock rocked by the same headwinds facing the rest of the sector. However, what sets ASML apart is that its Q3 quarter indicated that demand and sales remain strong. That is a reason to believe ASML may go in the upward direction. 

Microsoft (NASDAQ: MSFT)

MSFT may be hovering around its 52-week low, but the stock is likely to make a reversal. It showed a strong recovery after the pandemic, and its sales were strong. MSFT trades at a healthy multiple, so what was the cause of the decline? It seems that Wall Street punished MSFT for the sluggish performance of Azure, but its other metrics were strong. We predict MSFT will make a rebound and will reward investors in 2023. 

Domino’s Pizza (NYSE: DPZ)

Food companies have a significant challenge with higher prices for raw materials. This impacts companies across the sector, but Domino’s Pizza seems to be handling these headwinds with grace and is seeing rising demand. Its net income decreased but compared to supply chain costs; the loss was much less than expected. In the meantime, people are still buying Domino’s Pizza and will continue to do so in a recession. 

O’Reilly (NASDAQ: ORLY)

In challenging economic times, people are likely to put off buying a new car. They are more likely to repair their existing car or buy a clunker and fix it up. This is a major boon to O’Reilly, which should continue to see strong sales. 

There’s always a place to invest, even in a downturn. These stocks are relatively stable and may even make you a big chunk of change in 2023. 

FAQs

What stocks should I buy in an economic downturn?

You should consider investing in tech stocks like Apple (AAPL), Microsoft (MSFT), and Paypal Holdings (PYPL). Food companies like Domino’s Pizza (DPZ) may also be a good option as people still need to eat. Additionally, you can look at United Health Group (UNH) and O’Reilly Auto Parts (ORLY).

Is it safe to invest in stocks during a recession?

Investing in stocks during a recession may involve more risk than usual. However, if you do your due diligence and research the market carefully, there are opportunities for those with the right strategy. As with any investment, you should always be aware of the risks and diversify your portfolio. It is unknown if and when a recession will occur or how severe it may or may not be.

Are stock buybacks a good idea?

Stock buybacks can be a good way to reward investors and increase share prices. However, they may not always be the best option for long-term growth as they decrease the amount of cash available for reinvestment into the company. Before investing in stock buybacks, it is essential to consider the potential benefits and drawbacks.

Should I invest in stocks or bonds?

Investing in stocks or bonds largely depends on your risk tolerance and objectives. Generally, stocks are considered riskier investments with the potential for greater returns, while bonds tend to be less risky with more stable returns over time. Ultimately, it is up to you to decide which asset class makes the most sense for your portfolio.

What should I look for when investing in stocks?

When investing in stocks, it is essential to research the company thoroughly and pay attention to the fundamentals such as earnings, book value, and cash flow statements. Additionally, look at factors such as market conditions and economic forecasts affecting stock prices. Lastly, make sure you diversify across different sectors to reduce risk.

Is it a good time to invest in stocks?

It depends on your individual financial goals and risk tolerance. Overall, the stock market has been performing well despite the pandemic. However, as with any investment, there is no guarantee of future returns, so make sure you research thoroughly before investing your hard-earned money.

How can I protect my investments during a recession?

The most important thing you can do is diversify your portfolio across asset classes such as stocks, bonds, and real estate. Additionally, you should keep an eye on economic indicators and adjust your portfolio accordingly if needed. Lastly, ensure that you are not taking on too much risk and always stay within your means when investing.

What stocks should I avoid in a recession?

It is best to avoid speculative investments such as penny stocks and day trading. Additionally, you should avoid investing in companies with high debt levels or businesses heavily dependent on the economy. Lastly, avoid companies that have recently experienced significant losses due to the pandemic.

How can I make money during a recession?

In addition to traditional investment strategies such as stock market investing, there are other ways to generate income during an economic downturn. Consider starting a side hustle, freelancing or taking advantage of opportunities in real estate. Additionally, look for new businesses or industries that might be able to benefit from current market conditions and think outside the box!

 

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