3 stocks to have in your portfolio when the market crashes

The stock market is experiencing a period of increasing volatility, with Wall Street showing signs of a slowdown. According to JPMorgan, it may be time to adopt a defensive strategy. Major stock indexes, including the S&P 500 and Nasdaq Composite, have seen significant declines since the start of the year, as enthusiasm for the artificial intelligence sector seems to be decreasing. Since the peak in March, the S&P 500 has lost around 1.70% and the Nasdaq Composite has lost 1.65%.

In this uncertainty environment, JPMorgan suggests focusing on traditionally defensive stocks, such as utilities and consumer staples stocks. These sectors are known to offer greater stability during economic turbulence, thanks to their resilience and consistent returns. Here are some of the best stocks recommended by JPMorgan for dealing with periods of market instability.

1. NRG Energy

NRG Energy (NRG) is a major component of the Utilities Select Sector SPDR (XLU) fund, with a weighting of 14.37%. NRG Energy, a mainstay of the energy industry, reported an exceptional first quarter of 2024, exceeding expectations with a notable increase in its adjusted EBITDA, which grew 31% versus ’last year. This result is due to growing energy demand, fueled by electrification and the growth of GenAI data centers. NRG Energy has reaffirmed its financial guidance for 2024, indicating confidence in its diversified strategy and growth prospects.

NRG Energy daily graph

Source: Tradingview

NRG Energy has identified Texas and Northeast markets as strategic locations to meet growing electricity demand. The company outlined four pillars for value creation: residential energy, business-to-business platforms, Texas generation fleet, and co-location real estate. With 21 sites spread across 21,000 acres, NRG Energy has significant development potential for the future.

Looking ahead, NRG Energy is committed to maintaining a solid growth target of between 15% and 20%, anticipating further growth in free cash flow due to the optimistic forecast curve forecast. The company will continue to return value to shareholders and explore new investment opportunities, leveraging its diversified supply strategy to generate long-term sustainable value.

2. Duke Energy Corporation

Duke Energy Corporation daily graph

Source: Tradingview

Duke Energy Corporation (DUK), a major energy provider in the United States, announced strong financial results for the first quarter of 2024.

The company reported adjusted earnings per share (EPS) of $1.44, beating analysts’ consensus of $0.06, set at $1.38. Quarterly revenue also beat forecasts, coming in at $7.67 billion versus the $7.31 billion expected. This robust growth reflects Duke Energy’s strategic approach as it continues to invest in clean energy and grid enhancements to support the long-term sustainable energy transition.

Duke Energy is committed to its goal of achieving net-zero emissions by 2050. The strong performance in the first quarter confirms that the company is making the most of its investments to expand and modernize energy infrastructure. Lynn Good, president and CEO, said, “Our strong performance reflects a commitment to operational excellence and our strategy for cleaner energy solutions.” Looking ahead, Duke Energy provided cautious but stable guidance, indicating adjusted EPS of $5.85 to $6.10 for 2024.

3. Philip Morris International

Philip Morris daily graph

Source: Tradingview

Philip Morris International (PM) is a company that continues to generate interest among investors due to its ability to generate consistent growth and returns. After splitting from Altria in 2008, Philip Morris International gained the right to sell its brands outside the United States, diversifying its customer base and offering greater flexibility in sales and marketing strategies. The historical earnings per share (EPS) growth rate is 4.8%, but the outlook for the future looks even more promising. Analysts expect Philip Morris’ EPS to grow 6% this year, beating the industry average of 5.8%.

In the last reported quarter, the company posted earnings of $1.38 per share, confirming its ability to generate consistent profits. With this solid foundation, Philip Morris International remains an attractive choice for investors looking for growth stocks with solid return potential.

|DISCLAIMER
The information and considerations in this article should not be used as the sole or primary basis for making investment decisions. The reader maintains full freedom in his own investment choices and full responsibility in making them, since he alone knows his risk propensity and his time horizon. The information contained in the article is provided for informational purposes only and its disclosure does not constitute and should not be considered an offer or solicitation to the public for savings.|

Original article published on Money.it Italy 2024-06-01 21:29:00. Original title: 3 azioni da avere in portafoglio quando il mercato crolla (secondo JP Morgan)