10 of The Best Stocks To Buy In 2021
Here are 10 of the best stocks to buy in 2021 with a rundown of how each is fairing up on the market today.
As the S&P 500 is currently up around 16.67% YTD, and is anticipated to gain another 7% before the year is out, here are 10 of the best stocks to buy in 2021 that look set to continue or establish further momentum as the economy continues its rebounding story.
Top 10 Best Stocks To Buy In 2021:
Every Year Trading Education selects top 10 stocks to buy. Here's a look at the best stocks to buy list for 2021 and how each pick has performed.
- Amazon (AMZN)
- The Walt Disney (DIS)
- Facebook (FB)
- Newmont (NEM)
- Exxon Mobil (XOM)
- Victoria’s Secret (VSCO)
- Capital One Financial (COF)
- Allegiant Travel (ALGT)
- Darling Ingredients (DAR)
- UnitedHealth Group (UNH)
Best Stocks To Buy in 2021:
1. Amazon (AMZN)
Holding a market capitalization of $1.67 trillion, the world's biggest retailer Amazon (AMZN) looks set for the long haul as it continues to evolve overtime.
During the unprecedented year of 2020, only a few companies significantly benefit from the strict lockdown measures that were imposed across the globe. But this was far from the case for AMZN stock who witnessed its revenue soar to a new record of $386 billion, an increase of $100 billion YoY as individuals across the globe made use of the next day delivery on almost 353 million products available on the Amazon marketplace.
As we made our way into 2021, many analysts anticipated that the ease of restrictions was going to impact Amazon and cause the stock to take a backwards step following the re-opening of malls that were anticipated to be more favourable for consumers across the globe.
Within Amazon’s recent Q2 report, the tycoon company confirmed that it missed analysts' estimates based on last year's performance with the stock reporting its first revenue miss in over three years to $113.08 billion, from $115.2 billion expected. Nevertheless, the company’s revenue is up by 27% year over year with its earnings growing to $15.12 per share, from $12.30 per share that analysts expected.
Looking ahead, Amazon has forecast to see slower growth over the coming months due to ease of lockdown restrictions, but Amazon expects net sales to grow between 10% and 16% to $106.0 billion and $112.0 billion compared to Q3 2020 and operating income to witness a decrease of between $2.5 billion and $6.0 billion from $6.2 billion in Q3 2020. Analysts estimate revenue for Q3 to reach $111.68 billion and earnings estimated at $9.01 for the quarter.
AMZN stock has set a strong trend that will more than likely continue to maintain for many more years to come, making this stock a buy and one to hold for the long term.
2. The Walt Disney (DIS)
Disney shares have rallied in 2021 and it's clear to see why.
Following the widespread COVID-19 pandemic, Disney was arguably one of the biggest hit blue-chip stocks in 2020 as the company witnessed revenues lose significantly through the likes of its theme park closures, cruise liners coming to halt and its retail stores all having to seize operations. But thanks to its Disney+ streaming service growing impressively, reaching 73 million paid subscribers throughout the year caused DIS stock to keep afloat.
Moving to recent times, Disney’s theme parks have once again made an impact as restrictions ease across the globe reaching revenue of $4.34 million for Q3, with the U.S theme parks pushing into profitability by making a profit of $2 million for the quarter. The stocks Disney+ segment also confirmed its presence as being on par or close to one of its rivals Netflix, as the platform totaled 116 million paying customers at the end of Q3, ahead of 115.2 million customers expected by analysts.
Moving forward Disney has confirmed that demand is strong in all areas. Bookings for all of the stock’s ships remain strong especially after its marketing launch of its fifth ship, the Disney Wish that is due to set to sail in summer 2022. The stock’s parks businesses are set to continue to recover and are set to witness heavy demand in growth with the company adding to the mix its latest release of its new annual pass membership, Magic Key that will enable members to make advanced reservations and seek additional benefits. Additionally, Disney’s Disney+ stream has been projected to more than double by the end of 2021 with analysts predicting revenue for this segment to reach $10 billion for FY 2021.
3. Facebook (FB)
As of the second quarter of 2021 results, the social media giant Facebook Inc (FB) continued to be the social platform for individuals across the world. The stock confirmed monthly active users totalled to 2.90 billion for the quarter, Facebook’s revenue grew by an impressive 56% year over year to $29.08 billion, advertising revenue grew by 47% over the quarter and lastly, earnings blew past analysts predictions of $3.61 per share against $3.03 per share estimated.
Not only is Facebook a force within itself, but the tycoon company also has Instagram, Whatsapp and Messenger under its wing that contribute hugely within their own right to this stock’s solid performances. On that note, CEO Mark Zuckerberg’s plans on making this stock a “metaverse” company are well underway that aims to enable billions of users to interact in the world of virtual reality. Additionally, the company’s Oculus virtual reality segment is becoming one of its main concentrations moving forward.
Facebook sits on a healthy balance sheet with approximately over $64 billion in cash, a staggering amount that enables the stock to expand its future growth prospects.
As of today, Facebook holds a valuation of just over $1 trillion, and it looks clear to see that there is plenty more room for growth for this mega stock. Although slower sales are expected in the coming third-quarter, the company is still poised to reach full year revenue given by analysts of $119.2 billion, up from $84 billion in 2020 confirming that there is more room for growth for this FAANG stock.
Read Also: 10 Tech Companies To Invest In
4. Newmont (NEM)
When uncertain times arise investing in gold comes to be the safer investment for investors. Welcome the gold mining company Newmont Corporation (NEM) that looks to be a cut above the rest within this long regning market.
Within the unprecedented year of 2020, NEM stock benefitted impressively due to the uncertainty that surrounded both the market and the globe, as NEM generated record $4.9 billion of cash from operations and gained $3.6 billion of free cash flow. The company also produced 5.9 million ounces of gold over the year resulting in the stock declaring a fourth quarter dividend of $0.55 per share totalling to $1.45 per share for full year 2020.
Moving into 2021, NEM released its Q2 report that witnessed its earnings beat analysts expectations to gain $0.83 per share, from $0.76 per share that was estimated and the stock’s EPS of $0.32 per share it gained a year prior. The stock also beat Zacks Consensus Estimate by 0.04% to reach revenue of $3.07 billion for Q2 compared to $2.37 billion in Q2 2020.
The gold mining company has witnessed its shares decline over recent days to where it sits today at $56.91, - 3.31% down from yesterday's close with analysts predicting this stock to reach an average price target of $70.00, showing a 23.00% increase for the year.
Although Newmont Corporation has underperformed the market in 2021 and realistically looks like momentum will remain this way for the remaining months of 2021, makes now a good time to consider this stock whilst it sits under the radar slightly, especially if once again uncertainty surrounds this gold mining stock looks set to deliver.
5. Exxon Mobil (XOM)
As Oil-Energy stocks look to be on the rise in 2021, Exxon Mobil Corporation (XOM) looks to be one that is gaining the most attention within the market that has returned approximately 33.00% to investors over the past 12 months.
Within the stock's recent Q2 earnings report, the oil company is continuing to showcase its solid run in 2021 as the company is now sitting in a profitable position with earnings of $4.7 billion or $1.10 per share compared to a loss of $1.1 billion or a loss of $0.70 per share a year prior. Total revenues also beat expectations reaching $67,742, more than doubling from $32,605 million the company reached a year prior.
The rise comes from stronger consumer demand within the stocks products following the recovery from the COVID-19 pandemic, with operations within the U.S recording the biggest profit of $663 million compared to a loss of $1,197 million for the quarter. Upstream operations had an income of $3.2 billion compared to a loss of $1.65 billion a year prior, alongside income from chemicals rising to $2.3 billion from $467 million, downstream operations income did take a loss to $227 million from $976 million.
ExxonMobil’s future growth plans include investing in lower-carbon technologies to help expand growth opportunities over the long term as the world edges to a greener environment, with the stock introducing its ExxonMobil Low Carbon Solutions business that is looking to help lower emissions across various sectors that is poised to create multi-million pound markets by 2040.
According to analysts, revenue is predicted to rise by 21% for the year. Zacks Investment Research has also given the stock an A grade for growth, alongside expected earnings to grow at a rate of 17.15% over the coming 3-5 years as the world continues its economic recovery.
Check Out: 5 UK Growth Stocks That Could Make You Rich
6. Victoria’s Secret (VSCO)
In light of the recent split from its parent company L Brands (LB), Victoria’s Secret & Co (VSCO) has rallied in recent days. L Brands was made up of both VSCO stock and Bath and Body Works (BBWI) that combined resulted in a valuation as of August 2021 of $21.5 billion.
There is no denying that the VSCO brand has witnessed many challenges both pre-pandemic and during, but looking ahead into a post-pandemic world it looks as though the stock could see good gains moving forward with its re-structure that the brand has undergone for the past year.
Following the recent stock split, VSCO released its first standalone earnings that witnessed net sales rising to $1.61 billion, up by 51% compared to $1.07 billion YoY. Moving into the second quarter net sales were down by 10% from $1.79 billion in 2019 taking into account net closures of 240 stores from 2019, and lastly the stock's online sales witnessed a decline by 24% within Q2 2021 but showed a 26% rise from 2019.
Despite the stock still trailing behind the momentum is positive and according to Chief Executive Martin Waters, VSCO had its “most profitable spring season in five years” and continued to express “Our vital signs are strong and, with our exceptional leadership and associate teams, I continue to be confident in our long-term growth in all channels”.
As the brand continues to separate its past from its present, analysts are bullish on the VSCO stock to perform. Holding a consensus ‘Strong Buy’ rating with an average price target set to reach $100, showing a 39.49% upside from where the stock is currently trading today at $71.69 confirms that Victoria’s Secret & Co has a lot more to offer that investors may not want to miss out on as it continues to reinvent itself.
7. Capital One Financial (COF)
The Virginia-based financial service holding company Capital One Financial Corp (COF) is looking to be a value stock that investors may wish to add to their portfolio in 2021.
For the full year 2020 banks witnessed some saddening losses brought on due from the COVID-19 pandemic, but moving forward to the end of 2020 this financial stock managed to gain total net revenue of $28.5 billion, showing a 1% decrease YoY.
Moving into 2021, the banking industry is showing strong trends with analysts estimating the stock to reach sales of $29.23 billion for full year 2021. This is due to the industry witnessing more individuals borrowing and investing, lower unemployment levels and increased consumer spending globally. Capital One’s consumer loan services along with its credit card business are two key areas where the stock witnessed and is continuing to witness strong consumer demand.
As of the stock’s recent Q2 report, COF reported earnings of $7.71 per share compared to Zacks Consensus Estimate of $4.78 per share, total net revenues grew to $7.37 billion, up by 12% from the same quarter last year, alongside net interest growing by 5% to $5.74 billion.
Despite low interest rates remaining one of the major concerns for banks globally, the economy is continuing its road to recovery placing Capital One as one of the top financial companies that looks to show great long term growth for the future.
8. Allegiant Travel (ALGT)
The low-cost American passenger airliner Allegiant Travel Company (ALGT) is one travel stock that looks to be benefitting well following the opening of air travel.
Within the company’s recent Q2 report the company witnessed total revenue reaching $472 million for the quarter, showing a 3.9% change over the year. As a result of the revenue, the stock posted earnings of $5.49 per share for the quarter, up from $0.42 per share that the stock gained in Q1.
Moving forward ALGT stock has confirmed that it is to further pass pre-pandemic levels by continuing to grow its growth-capacity by 20% year over year as travel demand remains strong. As of writing this report, ALGT has today released its new signature non-credit card loyalty program, Allways rewards, that is designed specifically for leisure travelers to experience many opportunities and earn points from booking along with many exclusive benefits.
Bank of America analyst Andrew Didora has upgraded the stock to a ‘Strong Buy’, alongside giving an average price target of $260.00, showing a 39.66% upside from where the stock sits on the market today at $186.16.
9. Darling Ingredients (DAR)
A consumer staples stock that has been on the minds of many is Darling Ingredients Inc (DAR).
According to data, DAR has returned just above 28% so far this year whilst the consumer staples sector has returned 8.20% over the past 10 years according to the S&P Dow Jones Indices. This confirms that the stock is performing better than this sector based on its yearly returns.
Within the company’s recent Q2 report, DAR reported net sales reached $1.2 billion compared to net sales of $848.7 million in the same quarter YoY, net income reached $196.6 million or $1.17 per share for the quarter, alongside combined adjusted EBITDA of $353.7 million.
Looking ahead, analysts are bullish on the stock expecting revenue to rise by 12.61% to $4.6 billion in 2021, alongside earnings to reach $3.52 over the next year.
As the world continues to edge towards a sustainable future, look to DAR stock to be a clear leader within its industry as it continues to produce sustainable products to feed the world.
10. UnitedHealth Group (UNH)
The last stock to come on the list of 10 top stocks to buy in 2021 is UnitedHealth Group Inc (UNH).
UNH has gained just under 32% over the past year compared to the medical sector's 23.3%, with the medical stock surpassing earnings in the past four quarters. Within the stock's latest Q2 results UNH grew revenues to $71.3 billion, confirming a 15% increase YoY with earnings from operations of $6.0 billion with adjusted earnings being $4.70 per share.
Moving forward, Zacks Investment Research has given UNH a grade B for value alongside a grade A for growth in light of the stock’s performance. Aside, the stock holds an average price target of $500, showing a 20% upside within its shares from today's price with revenue expected to rise by 5% to $284 billion for full year 2021.
As the stock continues to provide healthcare benefits globally, UnitedHealth Group is dedicated to improving the value consumers receive by reducing care costs and enhancing the quality of care making UHN a standout medical stock that looks to be a leader for the long run.
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