Core Insights - Defensive consumer staples stocks are becoming increasingly popular among investors during market volatility, as they provide essential goods regardless of economic conditions [2] - Walmart Inc. has emerged as a strong performer in the defensive sector, with its stock up 23.8%, although it is trading at a premium valuation of approximately 39 times earnings [3] - Costco Wholesale Corp. has seen a decline of 5.5% in its stock price, currently trading at 46 times earnings, which is a discount compared to its historical average [3] - Procter & Gamble is down over 14% due to competition from private label brands, but it is trading at around 21 times earnings, indicating a potentially attractive valuation [4] - The outlook for these defensive stocks varies depending on economic conditions, with analysts divided on whether the U.S. economy will experience growth, a slowdown, or stagnation [4] Company Summaries - Walmart has been the standout performer in the defensive category, but investors are paying a premium for its consistent performance [6] - Costco's recent stock pullback does not necessarily make it a bargain, as it is still priced for strong execution despite a challenging year [6] - Procter & Gamble appears to be reasonably valued, but ongoing pressure from private-label brands may limit its growth potential if the economy slows [6]

Economic Overview - Consumer confidence in the United States fell to 89.1 in December, a decline of 3.8 points from November's 92.9, indicating growing concerns over jobs and income amid a weakening economy [4][10] - The Present Situation Index dropped 9.5 points to 116.8, reflecting a negative assessment of current business and labor market conditions [4] - The Expectations Index remained unchanged at 70.7, staying below the 80 mark for 11 consecutive months, which signals a potential recession [5] Federal Reserve Actions - The Federal Reserve cut interest rates by 25 basis points three times in the current year but indicated only one rate cut for the next year due to persistent high inflation [5][6] Market Trends - A significant tech selloff has occurred, with investors offloading tech stocks due to concerns over profitability against high valuations, leading to a loss of momentum in the tech rally [6][10] Investment Recommendations - Investors are advised to focus on low-beta, defensive stocks from the utility and consumer staples sectors to mitigate market volatility [2][10] - Recommended stocks include: - **Atmos Energy Corporation (ATO)**: Expected earnings growth rate of 6.7%, beta of 0.75, and a dividend yield of 2.38% [8][7] - **American States Water Company (AWR)**: Expected earnings growth rate of 5.1%, beta of 0.70, and a dividend yield of 2.76% [12][11] - **Sempra (SRE)**: Expected earnings growth rate of 12.1%, beta of 0.73, and a dividend yield of 2.91% [13] - **Ingredion Incorporated (INGR)**: Expected earnings growth rate of 1.6%, beta of 0.72, and a dividend yield of 2.94% [14]

Core Viewpoint - Apple has demonstrated resilience in its stock performance throughout 2025, achieving a year-to-date gain of 12.1% despite market volatility [1][4]. Stock Performance - Apple's stock closed at $273.40 on December 29, 2025, up from approximately $243.85 at the beginning of the year [1]. - An investment of $1,000 at the start of 2025 would now be worth about $1,121, reflecting a gain of approximately $121 [3]. Market Dynamics - The stock experienced a dip below $200 during a market pullback in Q1 but gradually recovered, with significant gains in the second half of the year [4]. - By November, AAPL shares reached new highs above $280 before slightly consolidating at year-end, indicating strong investor demand for Apple's defensive characteristics [5]. Revenue and Growth Drivers - Apple's performance has been supported by growth in its high-margin services segment and ongoing share repurchases, which have stabilized earnings and investor sentiment [6]. - Despite mixed hardware demand, recurring revenue from subscriptions, payments, and digital services has been crucial for maintaining performance [6]. Capital Return Strategy - The company has maintained an aggressive capital return strategy, which serves as a long-term benefit for shareholders, especially during uncertain market conditions [7]. Analyst Outlook - Analysts view Apple as a core long-term holding heading into 2026, with expectations for moderate growth compared to AI-centric stocks [8]. - Apple's pricing power, brand strength, and ecosystem lock-in continue to attract institutional capital, positioning it as a defensive anchor within technology portfolios [9].

Core Viewpoint - The focus is on gradually increasing positions in defensive stocks that offer decent dividends in an unpredictable market [1] Group 1 - The strategy involves seeking relatively safe investments to mitigate risks associated with market volatility [1]

With markets trading close to all-time highs, defensive stocks such as Carrefour SA ( OTCPK:CRRFY , CA.PA) have naturally not been on the radar for investors. This is actually quite good if youI ventured into investing in high school in 2011, mainly in REITs, preferred stocks, and high-yield bonds, starting a fascination with markets and the economy that has not faded despite the years. More recently I have been combining long stock positions with covered calls and cash secured puts. I approach investing pu ...

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Core Insights - Consumer sentiment has significantly declined, reaching a record low of 51 in November, down from 53.6 in October, and down 29% year-over-year [4][5] - The uncertainty surrounding the Federal Reserve's monetary policy and the economy's health has led investors to favor low-beta, defensive stocks, particularly in the consumer staples sector [1][2] Consumer Sentiment - The University of Michigan's Surveys of Consumers reported a final reading of 51 for consumer sentiment in November, slightly up from a preliminary reading of 50.3 [4] - The decline in consumer sentiment is attributed to a slowing labor market and high inflation, which pressures consumer spending [6] - Long-term inflation expectations decreased from 3.9% in October to 3.4% in November [5] Investment Focus - In the current market environment, investors are advised to consider low-beta stocks with high dividend yields and favorable Zacks Ranks to mitigate market volatility [2][3] - Recommended stocks include: - **Entergy Corporation (ETR)**: Expected earnings growth rate of 6.9%, Zacks Rank 2, beta of 0.63, and a dividend yield of 2.73% [9] - **CenterPoint Energy, Inc. (CNP)**: Expected earnings growth rate of 9.3%, Zacks Rank 2, beta of 0.60, and a dividend yield of 2.22% [13] - **John B. Sanfilippo & Son, Inc. (JBSS)**: Expected earnings growth rate of 18.1%, Zacks Rank 1, beta of 0.37, and a dividend yield of 1.28% [15] - **Universal Corporation (UVV)**: Expected earnings growth rate of 2.4%, Zacks Rank 2, beta of 0.73, and a dividend yield of 6.19% [16]

Group 1 - Stock futures are climbing following Nvidia's earnings report, indicating positive market sentiment [1] - Defensive stocks, particularly in consumer staples, are experiencing declines, with the Consumer Staples Select Sector SPDR Fund (XLP) down 0.4% [1] - Major holdings in the XLP include Colgate-Palmolive, PepsiCo, Walmart, and Costco, which are facing downward pressure [1] Group 2 - State Street's S&P Dividend ETF is also seeing a decline, reflecting challenges in dividend-paying stocks [2]

Investors are ditching tech winners in favor of more defensive stocks. One of the beneficiaries: companies with juicy dividend payments. https://t.co/548tLhPkte ...

Core Viewpoint - Recent market turmoil, particularly driven by a selloff in artificial intelligence stocks, presents an opportunity for less risky sectors of the market to perform better, although not all sectors are prepared to capitalize on this situation [1] Group 1 - The artificial intelligence sector has experienced significant volatility, leading to a broader market selloff [1] - Less risky areas of the market are being highlighted as potential beneficiaries of the current market conditions [1] - There is uncertainty regarding which sectors will effectively take advantage of the opportunity presented by the market turmoil [1]