‘Safe Money’ Stocks Are Surging

Wednesday, April 07, 2021

One is a distributor of key products used in housing and commercial construction, with a dividend yield that’s almost double that of the S&P 500 Index.

Another is a Canada-based planning, engineering and consulting giant active in the infrastructure project business.

The third is a familiar name in a sector that’s already seeing strong demand and product shortages ... and that’s likely to get a major influx of aid from an unlikely source.

These three companies share four key attributes:

•  They earn high Weiss Ratings from our completely unbiased, data-driven grading system.

•  They support solid, generous yields that can pad your income in a world of rock-bottom interest rates.

•  They offer direct or indirect exposure to the “money flood” spewing from Washington.

•  They’re perfectly positioned for the current confluence of credit, economic and political cycles.

OK, here’s one more thing they share in common: They’re all hitting new highs. And that’s good news for Safe Money Report subscribers and their total return. Click here to learn more about those companies.

Now, the fact that these stocks are hitting new highs illustrates my key point today: The market’s character is changing. And, if you change your investing approach in response, I believe you’ll be much happier with the results.

The averages are no longer simply being dominated by a handful of over-owned, overhyped technology giants.

In fact, as The Wall Street Journal noted on Tuesday, formerly tame, Steady Eddie, relatively overlooked stocks are trouncing high-flying, popular growth names by the largest margin in 20 years.

It’s not just that dynamic. Look at all the supposedly sizzling special purpose acquisition companies (SPACs) and other white-hot public offerings that have been dominating the airwaves. Many of them roared out of the gate to much fanfare last winter.

But now, with the coming of spring, they’re getting left in the dust by safe money-style names.

Stock No. 1 from my list above has risen almost 15% in the last three months. Stock No. 2 has gained even more — roughly 32%.

Care to guess what, say, a popular tech name like Tesla, Inc. (Nasdaq: TSLA) has done in that same time period?

Would you be surprised to hear “it is down 8%” as an answer? A diversified SPAC ETF called the Defiance Next Gen SPAC Derived ETF (NYSE: SPAK) has lost around 4% during that same period. Even Apple Inc. (Nasdaq: AAPL) has gone essentially nowhere.

Of course, the numbers will look different if you use different timeframes. But my point is simple: The character of the market is changing.

At this phase in the credit, economic and political cycles, you’re much better off zeroing in on safe money-style names that are much better positioned to win now ... and keep winning in the rest of 2021 and beyond.

Think yield. Think economic sensitivity. Think relative cheapness.

And forget about hype.

I know my Safe Money Report subscribers will be doing so.

Until next time,

Mike Larson

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