Large-cap stocks offer a degree of safety in an inconsistent economic environment
In this kind of market it’s hard to tell where we’re headed. That’s why sticking with the best large-cap stocks is the best idea for now.
Is the economy too hot or is it cooling due to the delta variant? Is there too much money in the system or is there still too much economic dislocation?
These aren’t small questions and that’s why the market, while still trending upward, is doing so cautiously. Chinese manufacturing stocks are down, yet U.S. jobless rates continue to decline.
But quality large-cap stocks are well-positioned here. Institutional investors love the stability they bring. And individual investors see them as rational growth with more safety than mid- and small-cap stocks. That’s why the best large-cap stocks are a great choice now and for the long term.
- BioNTech SE (NASDAQ:BNTX)
- Carrier Global (NYSE:CARR)
- Capital One Financial (NYSE:COF)
- Alphabet (NASDAQ:GOOG, GOOGL)
- Goldman Sachs (NYSE:GS)
- Nucor Corp (NYSE:NUE)
- Thomson Reuters (NYSE:TRI)
Large-Cap Stocks to Buy: BioNTech SE (BNTX)
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If you want the poster child for the modern ground-floor opportunity stock, BNTX is it. It’s a German biotech company researching novel medical solutions using messenger RNA (a DNA building block) in the treatment of cancer and other diseases using the body’s immune system to boost drug efficacy and safety.
It just so happened to be in the right place in the right time when the pandemic hit and partnered with drug giant Pfizer (NYSE:PFE) to create the now well-regarded Pfizer-BioNTech vaccine. The rest is history — or the future, in BNTX’s case.
This small firm now sports an $84 billion market cap. It has gained 326% year-to-date (YTD) and 494% in the past 12 months.
It may be new to large-cap stocks, but its leap to the spotlight marks a watershed event in immunotherapy development and applications. It’s had a big year, but it has years of growth ahead — BNTX is still trading at a trailing price-to-earnings (P/E) ratio of 18.
This stock holds an A rating in my Portfolio Grader.
Carrier Global (CARR)
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Founded in 1915 in Florida, CARR is one of the world’s leading HVAC companies. It’s also one of the heroes of summers for many households around the world. Willis Carrier is recognized as the inventor of air conditioning in 1902.
With climate change upon us, heating and cooling homes, businesses, warehouses and transportation vehicles is becoming more of a necessity than an option.
CARR was purchased by a large multinational conglomerate in 1979 when that was the trend. It was spun off from that company in 2000, when focused multinationals became the trend.
On its own for the past two decades, CARR sits comfortably among large-cap stocks, with a market cap of $49 billion. That makes it one of the biggest HVAC players in the world. And it continues to produce some of the best products in its various sectors.
CARR is up 49% year to date, yet still trades at a current P/E of 20. It’s not sexy, but it’s a solid earner with a long, reliable history.
This stock holds an A rating in my Portfolio Grader.
Large-Cap Stocks to Buy: Capital One Financial (COF)
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Launched in 1994 in Richmond, Virginia, COF was originally a monoline banking company. That means it had one product — credit cards. By 1996, it was operating in the U.K. and Canada.
But it wasn’t until 2005 that COF purchased a bank and began operating beyond credit cards. It has since then become a full-fledged bank complete with financial services.
It was one of the first big banks to see the demands of younger demographics and begin to shift its business to cater to Gen X and Gen Z customers. Its “cafes” — new relaxed spaces instead of legacy bank lobbies — are part of this effort.
Given it commands a $69 billion market cap, it’s certainly in the large-cap stocks category and is one of the leading money center banks. COF stock has gained an impressive 56% YTD, yet it still has a 1.53% dividend and a current P/E just above six.
This stock holds an A rating in my Portfolio Grader.
Alphabet (GOOG, GOOGL)
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First, let’s get one thing out of the way. The difference between GOOG shares and GOOGL shares is that with the latter, you get voting rights for your shares.
Now, you may want a toehold inside Alphabet, but with 320 million shares outstanding you’d have to have a pretty big position to make your voice heard. Plus, the voting shares are about $15 per share more expensive on average.
GOOG is a massive stock sporting a nearly $2 trillion market cap. It’s one of those stocks that’s bought in good markets for growth and bad markets for safety. It’s one of the handful of mega large-cap tech stocks that will continue to dominate its markets for years to come.
It currently has 92% of the global search market and that may draw some lawsuits, but that won’t stop that kind of market dominance.
GOOG has returned 66% YTD.
This stock holds an A rating in my Portfolio Grader.
Large-Cap Stocks to Buy: Goldman Sachs (GS)
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The markets around the world are back in growth mode again. And one of the best ways to play the rebound of growth and economic expansion is with an investment bank.
Although, to be accurate, now that it’s possible for investment banks to operate like traditional consumer deposit-driven banks, GS is on both sides. Its consumer side is geared more toward a neobank and it is moving hard into cryptocurrencies as well as retail investment vehicles. All these products are digital operations.
But GS also remains one of the most prestigious investment banks in the world, working with governments, industries, and even its peers investing in projects and assets. And in a era of low interest rates, GS has been able to leverage its power to secure great returns. It’s the financial partner of many large cap companies.
GS stock is up 55% YTD, provides a solid 1.95% dividend and trades at a current P/E of about seven.
This stock holds an A rating in my Portfolio Grader.
Nucor Corp (NUE)
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When you get to the core of an expanding economy, you get back down to industrial commodities. They’re the building blocks of growth. Without them you don’t have steel, iron and copper.
That’s why there’s so much competition to access emerging markets in developing nations with abundant raw materials. Firms from around the world are in Africa, South America, South Asia and other regions fueling the world’s infrastructure growth.
Interestingly, NUE began as a venture of Ransom Olds, after leaving Oldsmobile to start REO Motor Car Company. For all you 1980s rock n’ rollers, that’s the company that made the renowned truck, REO Speedwagon.
As the company shifted from steel to cars, steel operations were eventually sold off and evolved into NUE, the largest U.S. steelmaker. It’s also the biggest recycler of scrap steel in North America.
With a $33 billion market cap, it’s one of the best large-cap stocks in the steel industry. It should see a lot more growth as infrastructure spending ramps up in the U.S., especially with the proposed $1 trillion infrastructure plan moving closer to approval.
NUE has gained 113% YTD, yet still has a 1.41% dividend and a P/E slightly above 11.
This stock holds an A rating in my Portfolio Grader.
Large-Cap Stocks to Buy: Thomson Reuters (TRI)
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While half of its name may be familiar to many of you, Canada-based TRI is one of the largest publishers in the world. Much of its publishing empire focuses on professional products for the tax and accounting, legal, regulatory and professional services sectors. But Reuters is one of the leading news companies in the world, which helps fuel the rest of the empire.
With a market cap near $60 billion, it has a global footprint and is another quiet giant among large-cap stocks. It’s not a flashy business, but it’s very well run and continues to grow, especially in this digital and mobile age.
The unexpected battle against fake news and the consumption of social media as fact has led to many to turn toward respected, objective news sources like Reuters for the real scoops.
TRI stock has gained 45% YTD, yet still trades at a current P/E below nine, with a dividend of 1.38%.
This stock holds an A rating in my Portfolio Grader.
On the date of publication, Louis Navellier has positions in BNTX, GOOG, and NUE in this article. Louis Navellier did not have (either directly or indirectly) any other positions in the securities mentioned in this article.
The InvestorPlace Research Staff member primarily responsible for this articledid not hold(either directly or indirectly) any positions in the securities mentioned in this article.
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