What Stocks Can Still Work for You? “Safe Money” Names Like These

Wednesday, February 06, 2019

The financial press always wants to talk about flashy tech stocks. But it’s the steady, reliable, income-generating “Safe Money stocks in defensive sectors that are working best.

Sometimes when I watch or read the financial news, I long for a simpler time. A time when the Amazon was just a jungle, an Apple was just a fruit, and a Google (or technically, googol) was just a really big number. 

Why? Because I feel like those are the only stocks you ever hear about. It’s like the thousands of other stocks that change hands each and every trading day don’t even matter.

Frankly, that’s a shame. After all, it’s many of those OTHER stocks you don’t hear about that are actually: A) Leading this market and B) Much better alternatives at this stage in the economic and credit cycle!

Think utilities, REITs, and other defensive stocks, including two companies in my Safe Money Report (one of which just had its best day since September 2014!)

Take the Utilities Select Sector SPDR Fund (XLU, Rated “B”). Stodgy, boring, defensive. Those are some of the nicer adjectives used to describe this sector ETF. But it’s up roughly 15.4% in the last year.

The Real Estate Select Sector SPDR Fund (XLRE, Rated “B-”) is another ETF that invests in higher-yielding and traditionally more defensive REITs. Call it dull if you will. But it has generated a total return of 16.7% in the past year.

Those gains are roughly DOUBLE the 7.7% you could have made in the Technology Select Sector SPDR Fund (XLK, Rated “B”) over the same time period. As for the AdvisorShares New Tech and Media ETF (FNG, Rated “C”), whose ticker symbol recalls the ever-so-popular “FAANG” acronym, it’s DOWN around 22% in the past 12 months. Ouch!

Now it goes without saying that tech stocks rebounded in January as part of the market’s oversold bounce. But which stocks and sectors should you trust in the longer term? Which aren’t just likely to see quick bounces, but remain trustworthy after that?

The same “Safe Money”-style investments" that have been working best for more than a year now! Let the “30-second soundbite” analysts on television beat those other dead-horse stocks all day long. I’ll keep focusing on names that generate reliable, steady gains in the good times, and that won’t let you down when the going gets tough.

Take Clorox (CLX, Rated “B-”), a company I’ve been recommending in my Safe Money Report for a while now. Its shares just jumped the most in any day since September 2014 after the household products maker beat earnings estimates and forecast solid results going forward.

Another utility that I recommended subscribers add only last month has been rocketing higher, with shares hitting their highest level in almost 11 years this week. Why? The company has been paying down debt. It’s wisely restructuring its way out of bad investments made years ago. And it still yields 100+ basis points more than the SPDR S&P 500 ETF (SPY, Rated “C+”).

If you want the details on winners like these, just give my Safe Money Report a try. The names you’ll find may fly under the radar, unlike the companies you hear about every day. But that’s perfectly fine by me, because they’re generating reliable, steady income ... spinning off nice capital gains ... and best suited for this stage of the economic and market cycles.

Until next time,

Mike Larson

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