Bet on These 5 Low-Leverage Stocks to Avoid Industrial Volatilities

Core Viewpoint - The U.S. stock market experienced a decline primarily due to Nvidia's ban on H200 AI chips in China, which negatively impacted major technology stocks and bank earnings [2][10]. Market Overview - The three major U.S. stock indices fell on January 14, 2026, with Nvidia's decline leading the way, affecting other technology stocks [2]. - Major banks like Citigroup and Wells Fargo reported disappointing fourth-quarter results, contributing to the market's downturn [2]. Investment Strategy - Investors are advised to favor low-leverage stocks over high-growth technology stocks to mitigate risks associated with high-debt companies [3][10]. - Recommended companies include REV Group (REVG), TechnipFMC (FTI), Resmed (RMD), Zurn Elkay Water Solutions (ZWS), and SEI Investments (SEIC), all of which exhibit low leverage and solid growth prospects [3][10]. Significance of Low-Leverage Stocks - Leverage refers to borrowing capital for operations and expansion, typically through debt financing, which can pose risks if not managed properly [5][6]. - Companies with excessive reliance on debt financing may face significant losses during economic downturns, making low-leverage stocks a safer investment choice [6][7]. Debt Analysis - The debt-to-equity ratio is a key metric for assessing a company's financial risk, with lower ratios indicating better solvency [8]. - Investors should focus on stocks with solid earnings growth and low debt-to-equity ratios, especially during earnings seasons [8][10]. Stock Recommendations - REV Group (REVG): Reported a 11.1% year-over-year increase in net sales to $664.4 million and a 62.7% surge in adjusted earnings per share [14][15]. - TechnipFMC (FTI): Awarded a significant contract by BP, with a projected revenue increase of 6.6% for 2026 [16][17]. - Resmed (RMD): Received FDA clearance for an AI-enabled medical device, with an expected 8.4% revenue growth for 2026 [18][19]. - Zurn Elkay Water Solutions (ZWS): Recognized as one of America's Most Responsible Companies, with a projected revenue increase of 5.3% for 2026 [20][21]. - SEI Investments (SEIC): Completed multiple client projects, with a forecasted revenue growth of 9.3% for 2026 [22][23].