These 3 S&P 500 Index Components Deserve Your Attention
There are plenty of solid reasons why investors view the Standard & Poor’s 500 Index (S&P 500) as a benchmark for both the economy and their individual portfolios. This index contains some of the largest and most successful companies in the world, which means it can offer plenty of insight into the state of the corporate business world. With companies included from a broad variety of industry sectors and required to meet a strict list of qualifications to be added to the index, it’s safe to say that the S&P 500 index is essentially the gold standard of market indexes.
With the stock market off to a shaky start to 2022 due to a variety of headwinds, investors need to focus on adding quality companies to their portfolios now more than ever. Not all of the components of the S&P 500 index are facing the same selling pressure, which is why it might be a good idea to focus on the names that are outperforming this year, as they could be some of the first names to hit new highs when the market finds its footing.
That’s why we’ve put together the following list of 3 stellar S&P 500 stocks to buy now. Let’s take a deeper look at these standouts below. CME Group Inc (NASDAQ: CME)
CME Group is one of the few S&P 500 components in positive territory for the year, as the stock is currently up about 3.5% year-to-date. It’s also a good company to look at if you think that volatility will continue impacting financial markets for the rest of the year, as CME Group generates more revenue as transactions occur on its exchanges. The company operates the world’s largest futures exchange and serves the risk management needs of clients all over the globe with a diverse array of futures and options-on-futures products.
With interest rate hikes on the horizon, rising geopolitical risks, and plenty of question marks about the state of the economy, investors should expect lots of trading activity from institutional investors in the near term, which directly benefits CME Group. The company has a wide economic moat thanks to its market-leading position in futures and its exclusive licenses to issue futures contracts on major indices like the S&P 500 and the NASDAQ, which is another positive to consider. CME Group
reported record trading volume in 2021 and saw its Q4 Net Income increase by 22.2% year-over-year to reach $625 million, both additional signs that the company is thriving at this time. Altria Group (NYSE: MO)
What kinds of stocks can investors feel comfortable buying in a market that is subject to headline risk and sharp pullbacks? Low-beta dividend-paying S&P 500 components like Altria Group. The leading cigarette, smokeless tobacco, and alcoholic beverage producing company has been a true standout in 2022 and is up over 9% year-to-date, reflecting the increasing demand for strong income-producing assets in a “risk-off” market environment. While consumer preferences are indeed changing to favor more health-oriented habits, tobacco products are still considered to be a consumer staple that should hold up well in an inflationary environment.
Investors should also be interested in Altria’s
exclusive rights to Philip Morris International’s cigarette alternative iQOS, which could be a winning product in the United States over the long term. Finally, a 6.96% dividend yield makes Altria one of the best dividend stocks on the market to consider at this time. The stock is close to breaking out to new 52-week highs, so keep an eye on how shares perform in the coming weeks. Newmont Corporation (NYSE: NEM)
This S&P 500 metals and mining stock is another great option to consider in the current market environment. Newmont Corporation is the world’s largest gold producer and is also engaged in the production of copper. When stocks begin to tumble and the economy becomes more difficult to read, investors tend to pile into commodities like gold due to their “safe-haven asset” status. That means Newmont Corporation could be gearing up for a big rally if markets continue on the path of increasing volatility. The company’s earnings results are directly tied to gold production and prices, and the recent price action in the shiny precious metal suggests a breakout could be on the horizon.
Newmont Corporation is currently trading above all of the major moving averages, pays out an attractive 3.25% dividend
yield, and could benefit from strong synergies going forward thanks to a joint venture with Barrick Gold that has created the world’s largest gold complex. The company will report its full-year and fourth-quarter earnings on February 24th, which will provide valuable insight into the company’s prospects for the remainder of the year.
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Before you consider CME Group, you'll want to hear this.
MarketBeat keeps track of Wall Street's top-rated and best performing research analysts and the stocks they recommend to their clients on a daily basis. MarketBeat has identified the five stocks that top analysts are quietly whispering to their clients to buy now before the broader market catches on... and CME Group wasn't on the list.
While CME Group currently has a "Hold" rating among analysts, top-rated analysts believe these five stocks are better buys.
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