With inflation rampant, investors are looking for stocks of companies that can withstand or even benefit from higher prices.
Consumer prices rose 8.5% in the 12 months through March. Some companies were able to raise their prices to avoid suffering, and raise their shares.
Travel stocks, for example, rose last week, as consumers appeared willing to pay for trips after being stuck at home throughout the pandemic, the Wall Street Journal reported.
Shares of airlines, hotels and cruises rose. Delta Airlines (DA) – Get a Delta Air Lines, Inc. report. The rally was sparked when one of its executives said demand was so strong that the carrier would raise prices from 7.5% to 10% in the second quarter.
Delta stock jumped 15% last week. Hyatt Hotels (h) – Get the Hyatt Class A Hotel Company Report jumped 11%. and carnival cruise (CCL) – Get the Carnival Foundation report 7% profit.
List of stocks in Credit Suisse
In February, Credit Suisse presented a list of the top inflation-benefiting stocks.
The bank calculated the stock’s average daily return on the days when inflation was high and on the days when inflation fell over the subsequent 12 months. The company’s inflation sensitivity is the difference between the return on upside days minus the down days.
Among the 50 biggest beneficiaries of inflation in the S&P 500 are:
ExxonMobil (XOM) – Get Exxon Mobil’s report
Schlumberger (SLB) – Get a Schlumberger NV . report
daw (daw) – Get the Dow, Inc. report.
Las Vegas Sands (LVS) – Get a Las Vegas Sands Corp. report
etsy (ETSY) – Get an Etsy, Inc. report.
Norwegian Cruise Line (NCLH) – Get the Norwegian Cruise Line Holdings Ltd. report.
under the shield (UAA) – Get a first-class report for Under Armor, Inc.
State Street (ST) – Get the State Street Corporation’s report
Go to follow
Capital One Financial (COF) – Get the Capital One Financial Corporation reportAnd,
SolarEdge Technologies (SEDG) – Get the SolarEdge Technologies, Inc. report..
The list is full of energy and financial companies.
List of JP Morgan stock
Also in February, JP Morgan created a list of stocks it said were likely to outperform the market and a list likely to underperform when inflation fears or expectations increased.
Among the listed stocks of outperforming companies are Bank of America (buck) – Get Bank of America Corp . report
Boeing (Bachelor of) – Get the Boeing report
Freeport McMorran (FCX) – Get Freeport-McMoRan’s report
General Electric (GE) – Obtaining the General Electric report
American Airlines (AAL) – Get American Airlines Group ReportAnd,
Budget Avis (the cars) – Get an Avis Budget Group, Inc. report..
Among the stocks on the list of underperforming companies is Microsoft (MSFT) – Get a Microsoft report
modern (mRNA) – Get Moderna company report
Walmart (WMT) – Get a Walmart Inc. report.
Johnson & Johnson (JNJ) – Get a Johnson & Johnson report
Verizon Communications (VZ) – Get a Verizon Communications Inc. report.
Procter & Gamble Company (PG) – Get a Procter & Gamble ReportAnd,
Zoom video communication (ZM) – Get Zoom Video Communications, Inc. First class report.
Meanwhile, in an April 18 report, strategists at Morgan Stanley, led by Michael Wilson, said inflation will hamper future corporate earnings.
“We believe the positive effects of inflation on earnings growth have peaked and are now likely to be a headwind to growth, especially as inflation forces the Fed to remain very hawkish,” they wrote in a comment cited by Bloomberg.
Interest rate futures traders see a 74% probability that the Federal Reserve will raise interest rates by at least 2.25 percentage points over the remainder of the year.
“Margin forecasts look overly optimistic for Balance 22 given the myriad cost pressures companies face,” said the strategists.
The writer of this story owns shares in Exxon Mobil, Microsoft, Walmart, Johnson & Johnson, and Procter & Gamble.
