Zacks Value Trader Highlights: Exact Sciences, Edwards Lifesciences, Bristol Myers-Squibb, Occidental Petroleum And Exxon Mobil

Chicago, IL – September 20, 2019 – Zacks Value Trader is a podcast hosted weekly by Zacks Stock Strategist Tracey Ryniec. Every week, Tracey will be joined by guests to discuss the hottest investing topics in stocks, bonds and ETFs and how it impacts your life. To listen to the podcast, click here:

Stock Investors: Do You Need a Late-Cycle Plan?

Welcome to Episode #159 of the Value Investor Podcast.

Every week, Tracey Ryniec, the editor of Zacks Value Investor portfolio, shares some of her top value investing tips and stock picks.

Recently a lot of the analysts and portfolio managers have been mentioning in interviews that the economy is in the “late cycle.”

The late cycle usually indicates that growth is slowing, both in earnings and even revenue. It’s harder for companies to make that next big threshold level because they’ve been growing the business throughout the beginning and mid-cycle periods.

Quality of the earnings begins to matter and that usually means investors become more defensive as they seek out companies that will provide some protection in the case of an end cycle, or recession.

In 2019, utilities and REITs, both defensive sectors, have performed well.

But can value investors find some late cycle investments of their own?

Healthcare Can Be Defensive

The healthcare industry can be defensive in a late cycle because you basically have to spend on it no matter what the economic conditions.

1. Exact Sciences ( (NASDAQ:EXAS) ) has been one of the hottest stocks in the sector. Over the last 5 years it’s up 451%. While sales are still growing at double digits and are expected to surpass $1 billion in 2020, the earnings took a dive this year.

2. Edwards Lifesciences ( (NYSE:EW) ) is another big healthcare winner, with shares up 318% in the last 5 years. But it’s not cheap with a forward P/E of 41. But won’t people still get their heart surgery even in a recession? Earnings expected to rise double digits this year and next.

3. Bristol Myers-Squibb ( (NYSE:BMY) ) is a true value stock by its P/E which is just 11.6. It also pays a dividend, yielding 3.3%. But it’s 5-year return is terrible. It’s down 2.3% during that time versus a gain of 51% for the S&P 500.

What About Energy?

Normally, you wouldn’t want to be in energy stocks late in the cycle because a recession means lower oil and chemical demand. But some of the big energy stocks have already took it on the chin ahead of an economic slowdown.

1. Occidental Petroleum ( (NYSE:OXY) ) shares have plunged 43% in the last year and now trade with a forward P/E of 15.6. But it’s the dividend that is luring in investors as it’s currently yielding 7%. However, Occidental is a Zacks Rank #4 (Sell) as its earnings estimates continue to be cut.

2. Exxon Mobil ( (NYSE:XOM) ) is expected to see a 38% decline in earnings in 2019 but then analysts forecast a rebound in 2020 of 52%. It also pays a nice dividend, currently yielding 4.8%. Exxon is a dividend aristocrat. It didn’t even cut its dividend during the financial crisis.

What else should investors know about late cycle investing?

Find out on this week’s podcast.

Biggest Tech Breakthrough in a Generation

Be among the early investors in the new type of device that experts say could impact society as much as the discovery of electricity. Current technology will soon be outdated and replaced by these new devices. In the process, it’s expected to create 22 million jobs and generate $12.3 trillion in activity.

A select few stocks could skyrocket the most as rollout accelerates for this new tech. Early investors could see gains similar to buying Microsoft (NASDAQ:MSFT) in the 1990s. Zacks’ just-released special report reveals 7 stocks to watch. The report is only available for a limited time.

See 7 breakthrough stocks now>>

Media Contact

Zacks Investment Research

800-767-3771 ext. 9339

support@zacks.com

https://www.zacks.com/performance

Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.