3 Stocks Set to Soar if the Fed Cuts Interest Rates in September

Core Viewpoint - Anticipated interest rate cuts by the Federal Reserve are expected to create favorable conditions for several stocks, particularly in a low-interest environment, as investors look for potential opportunities amidst economic slowdown and recession fears [1]. Group 1: Ford (F) - Ford's stock has decreased by 19% this year, making it a potential buy despite missing analyst expectations for earnings per share (EPS) in Q2, which were 47 cents compared to the anticipated 68 cents [2]. - The company's net income fell to $1.83 billion, although revenue grew by 6% year-over-year, attributed to increased warranty reserves for older vehicles [2]. - Ford's electric vehicle (EV) segment continues to incur losses, but the company is optimistic that upcoming EV models will drive growth, especially with potential interest rate cuts that could boost demand through lower borrowing costs [3]. Group 2: Verizon (VZ) - Verizon's stock has declined following its Q2 earnings report, but it offers a dividend yield of 6.56% and trades at a low valuation of 8.9 times its estimated fiscal year 2024 earnings [5]. - The company's revenue for the previous quarter was $32.8 billion, slightly below the estimated $33.06 billion, impacted by increased phone plan prices and a low number of phone upgrades as consumers reduce spending [5]. - Interest rate cuts could significantly benefit Verizon by lowering debt costs and enhancing demand for its services, while also allowing for more efficient maintenance of its wireless network [6]. Group 3: PayPal (PYPL) - PayPal's stock shows promise with a Q2 revenue growth of 8% year-over-year to $7.9 billion, driven by an 11% increase in payment volumes and an 8% rise in payment transactions [7]. - The company maintains a strong liquidity position with free cash flow of $1.4 billion, indicating financial health [7]. - Anticipated interest rate cuts are expected to boost PayPal's earnings by increasing spending in the economy, which could lead to higher payment volumes and a revival in active account growth [8].