Stocking Stuffers: The Best Sectors for the Year Ahead
What to Expect in 2015
Five Stocks for the New Year
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The holiday season is my favorite time of the year! I love the cooking and baking, and most of all, the chance to come together with friends and family to just enjoy the season.
Of course, when you’re in the investment business—at almost any gathering—the conversation often turns to how everyone did in 2014, as well as how our strategies and goals may change for the new year.
And with the stock market going gangbusters last year, everyone wants to know if 2015 will bring more of the same. It may be hard to beat the great returns we’ve seen:
* Dow Jones Industrial Average, up 8.3%
* S&P 500 Index, a 12.4% gain
* NASDAQ, the best of all, with a 15.0% return
But from what I read and hear, I think experts agree that 2015 should be a positive year for the markets-barring any unforeseen adversity. After all, the unemployment rate has steadied at 5.8%, mortgages are still in demand (up 7.3% this week) as a result of the better economy and low interest rates, and consumer confidence remains high.
That means we have a lot of opportunities to look forward to!
Our Digest contributors have had a lot to say about what to expect in 2015. Most of them remain bullish-with a bit of caution thrown in-and are positive about investor prospects for the year. Some of the sectors they are recommending include retail, technology, finance, and even energy.
It stands to reason that with more money to spend, consumers will boost the retail coffers.
Our Spotlight Stock in Dividend Digest this month focuses on technology, a sector that will benefit from the rapid expansion in cloud computing. Other tech sectors should also win as many companies have cash piled up that they were too afraid to spend when the economy was weak.
Banks and brokerage firms should do well as credit has eased a bit and more consumption generally means additional borrowers, and a growing economy contributes to rising investment.
Real Estate Investment Trusts continue to hum along, benefiting from low rates and rising real estate demand.
And incredibly low oil prices have discounted the prices of scores of energy companies. As you know, the best time to buy is often when there is “blood in the streets,” as Warren Buffett has been known to say, and that may ring true for a host of energy companies.
Here are some of the investments our contributing experts have recommended in the past few weeks that you may want to consider for your portfolio in the new year:
Wal-Mart (WMT, retail sector) is recommended by John Buckingham of The Prudent Speculator. The company’s e-commerce sales and Neighborhood Markets helped Wal-Mart exceed analysts’ expectations for the latest quarter, and price targets were raised.
Microsoft (MSFT, technology) is recommended by Tyler Laundon of The 100% Letter. Prospects are high for the company’s cloud product, Office 365, with analysts expecting double-digit revenue increases.
TD Ameritrade (AMTD, discount brokerage) is recommended by Sean Christian of The Personal Capitalist. The brokerage firm is growing assets (up $13.4 billion in the September quarter) and revenues (up 12%), and beating earnings estimates.
CoreSite Realty (COR, REIT) is recommended by John Dobosz of Forbes Dividend Investor. The REIT of 18 data center properties serving 800 clients has rewarded shareholders with rising dividends (3.6% yield) and double-digit growth in revenues.
Global Partners (GLP, energy) is recommended by Robert Rapier and Igor Greenwald of The Energy Strategist. Global distributes fuel to more than 1,000 gas stations and its logistics business moves crude and fuel around the country. Debt is reasonable, growth is good, and the dividend is more than 6% as of this writing.
Amid the holiday celebrations, I hope you’ll take some time to think about (and record) your investment goals for 2015, and analyze the strategies you’ll need to achieve them. It looks like 2015 will offer an array of opportunities to fit almost any investment need.
I hope the above recommendations are just a taste of the gifts to fill your stockings with cheer!
For more guidance on the best stocks to buy in the New Year, consider taking a risk-free trial subscription to the Dividend Digest. You’ll receive the best investment idea sent directly to your inbox every day. And each year in January we feature the top picks for the year from the Wall Street’s top analysts. Don’t miss your copy.