Top pick Barrick Mining just raised its dividend a whopping 140% as it generates record earnings and continues its strategic asset reorganization.
Warner Music Group Corp. is well-positioned for higher-margin catalog revenues, added streaming adoption, and new AI monetization opportunities.
ARC Resources keeps returning its cash flow to shareholders through a growing dividend and substantial share buybacks.
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TUPPERWARE BRANDS CORP. $58 (New York symbol TUP; Conservative Growth and Income Portfolios, Consumer sector; Shares outstanding: 50.4 million; Market cap: $2.9 billion; Priceto- sales ratio: 1.2; Dividend yield: 4.7%; TSINetwork Rating: Above Average; www.tupperwarebrands.com) makes household goods, mainly plastic food and beverage containers, as well as cosmetics and fragrances. In the three months ended September 26, 2015, Tupperware’s sales fell 11.5%, to $521.0 million from $588.7 million a year earlier. Overseas markets supplied 73% of Tupperware’s sales, so if you exclude the negative impact of the high U.S. dollar, sales rose 7%. Earnings declined 12.2%, to $0.79 a share from $0.90. For all of 2015, the company expects its sales to rise 4% to 5%, along with earnings of $4.39 to $4.44 a share, excluding exchange rates. The stock trades at 13.1 times the midpoint of that range, which is reasonable in light of Tupperware’s large international operations. The $2.72 dividend seems safe and yields 4.7%....
NORDSTROM INC. $58 (New York symbol JWN; Aggressive Growth Portfolio, Consumer sector; Shares outstanding: 185.4 million; Market cap: $10.8 billion; Price-to-sales ratio: 0.7; Dividend yield: 2.6%; TSINetwork Rating: Average; www.nordstrom.com) is down 30% from its peak of $83 in March 2015. The company is seeing slowing sales, and it’s investing in new websites and stores in Canada. That’s squeezing its profit margins. In its fiscal 2016 third quarter, which ended October 31, 2015, sales rose 6.5%, to $3.2 billion from $3.0 billion a year earlier. Same-store sales rose 0.9%, well below the consensus forecast of a 3.6% gain. Earnings fell 21.9%, to $0.57 a share from $0.73. Nordstrom now expects same-store sales growth of 2.5% to 3.0% for all of fiscal 2016, down from its earlier forecast of 3.5% to 4.5%. It also cut its full-year earnings outlook to $3.35 a share from $3.75. The stock trades at 17.3 times the new estimate. That’s a reasonable multiple, as the company’s margins should improve once its new investments begin contributing to its profits....
ARCHER DANIELS MIDLAND CO. $36 (New York symbol ADM; Aggressive Growth Portfolio, Manufacturing & Industry sector; Shares outstanding: 596.7 million; Market cap: $21.5 billion; Price-to-sales ratio: 0.3; Dividend yield: 3.1%; TSINetwork Rating: Above Average; www.adm.com) processes corn, wheat, soybeans, canola, flax seed, peanuts and other crops into a variety of food ingredients, such as flour, oils and sweeteners. It’s also the largest maker of ethanol from corn in the U.S. In the three months ended September 30, 2015, Archer’s earnings fell 66.3%, to $252 million from $747 million a year earlier. It spent $1.8 billion on share buybacks in the first nine months of 2015, so per-share profits declined 64.0%, to $0.41 from $1.14, on fewer shares outstanding. Without unusual items, mainly gains on asset sales, earnings per share fell 30.2%, to $0.60 from $0.86. Revenue declined 8.6%, to $16.6 billion from $18.1 billion. International markets supply half of the company’s revenue, so the high U.S. dollar hurts the contribution from its overseas operations. Record crop harvests have also depressed prices and profits at its grain-trading business....
These two automotive-equipment suppliers have shot up in the past year, partly because strong car sales should spur demand for their products for years to come. Both stocks seem expensive in relation to their earnings right now, but we still see Genuine Parts as a buy, as it has a wider variety of businesses than Snap-On (see next article). GENUINE PARTS CO. $91 (New York symbol GPC; Conservative Growth and Income Portfolios, Manufacturing & Industry sector; Shares outstanding: 150.8 million; Market cap: $13.7 billion; Price-to-sales ratio: 0.9; Dividend yield: 2.7%; TSINetwork Rating: Average; www.genpt.com) gets about half of its sales and earnings by selling replacement auto parts. The company operates 1,100 outlets under the NAPA banner, and its distribution business serves 4,900 independent stores in North America, Australia and New Zealand....