If the Stock Market Continues Sinking, Here's How I'd Invest My Next $500

Market Overview - The stock market has started the year poorly, with the S&P 500 down approximately 15% from its recent peak [1] NextEra Energy - NextEra Energy is a leading utility company, operating Florida Power & Light, the largest electric utility in the U.S., and is a major renewable energy producer [3] - U.S. electricity demand is projected to increase by 55% by 2040, driven by data centers, AI applications, onshoring of manufacturing, and electrification of transportation, providing NextEra with significant investment opportunities [4] - The company anticipates its adjusted earnings per share to grow at the high end of its 6% to 8% annual target range through 2027, with expected annual dividend growth of around 10% through at least next year [4] - Despite the expected surge in demand, NextEra's shares have fallen over 20% from their peak, increasing its dividend yield to 3.4% [5] Broadcom - Broadcom is experiencing rapid growth, with a 25% revenue increase in its fiscal 2025 first quarter and a 28% rise in free cash flow to $6 billion, largely driven by AI-related semiconductor sales, which surged by 77% [6] - The company expects a further 19% revenue growth in the second quarter, supporting continued dividend increases, having raised its payout by 11% last year [7] - Broadcom's shares have declined more than 30% from their recent peak, resulting in a valuation of approximately 25.7 times forward earnings, which is higher than the S&P 500's valuation of less than 20 times [8] Invitation Homes - Invitation Homes is a REIT focused on single-family rental properties, owning over 85,000 homes outright and managing nearly 17,700 properties for third parties [9] - The demand for rental housing remains strong due to a significant affordability gap, with rents being about $1,100 cheaper per month in its markets, maintaining high occupancy levels [10] - The company expects a modest 2% increase in net operating income this year, with long-term rent growth expected to accelerate once economic uncertainties subside [11][10] - Invitation Homes' stock price has decreased less than 10% amid a broader market decline, pushing its yield up to 3.5% [12]