3 Defensive Stocks To Watch In August 2022

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3 Defensive Stocks To Watch In August 2022


Check Out These Three Top Defensive Stocks In The Stock Market This Week

As investors gear up for key economic data on Wednesday this week, defensive stocks may be worth your attention right now. After all, defensive stocks are a type of investment that can help to protect your portfolio during times of stock market turmoil. As a result, they can help to reduce the overall risk of your portfolio. Defensive stocks can come from a variety of sectors, but they typically have strong balance sheets and consistent earnings.

Notably, Utilities, Consumer Staples, and Health Care are often considered defensive sectors. Specifically, we can take a look at top defensive stocks such as UnitedHealth Group (NYSE: UNH) and The Procter & Gamble Company (NYSE: PG). While the S&P 500 is down over 9% year-to-date, these defensive stocks have seen their share price increase by over 8% so far this year.

However, it is important to remember that no stock is completely immune from market risk. Defensive stocks can still lose value if the overall market declines sharply. But if you are looking for a way to help weather the storm during a market downturn, defensive stocks may be worth considering. If you’re keen on investing in defensive stocks now, here are three to check out in the stock market today.

Defensive Stocks To Buy [Or Avoid] Now

United Parcel Services (UPS Stock)

United Parcel Service (UPS) is a global leader in logistics, offering a wide range of solutions including the transportation of packages and freight, the facilitation of international trade, and the deployment of advanced technology to more efficiently manage the world of business. As one of the largest companies in the world, UPS has a vast network of air, ground, and ocean transport capabilities, and its stock is widely traded on major exchanges. Given its size and reach, UPS is often considered a bellwether for the global economy, and its stock price is closely watched by investors. Despite some recent challenges, UPS remains a powerful force in the logistics industry, and its stock remains a popular choice for investors.

Just last month, UPS announced its second quarter 2022 earnings results. Diving in, the company posted earnings per share of $3.29, with revenue of $24.8 billion for Q2. This was a beat versus analysts’ consensus estimate of earnings of $3.14 per share and revenue of $24.6 billion. Also, UPS recorded a 5.7% increase in revenue on a year-over-year basis. Following up on that strong quarter, the company also announced its regular dividend of $1.52 per share. As a result of this announcement, UPS has either maintained or raised its dividend every year since it went public on the stock market in 1999. Given the financial strength, and track record, do you have UPS on your list of defensive stocks to watch?

Source: TD Ameritrade TOS

[Read More] Stock Market Today: Dow Jones, S&P 500 Open Mixed; Walmart, Home Deport Rally On Better-Than-Expected Earnings

McKesson (MCK Stock)

Next up, let’s dive into McKesson (MCK). The company is a healthcare supply chain management solutions company. McKesson’s solutions help streamline the entire healthcare continuum, from patient care to administration. Additionally, the company also provides a wide range of software and hardware solutions for healthcare providers, payers, and other organizations. MCK stock is a well-established name in the healthcare industry, and its shares are up over 50% year-to-date. McKesson’s strong fundamentals and growth prospects could make it a compelling investment for long-term investors.

Earlier this month, McKesson reported a beat for its Q1 2023 fiscal results. In detail, the company reported earnings per share of $5.83 on revenue of $67.2 billion. This is in comparison to wall street’s consensus earnings estimates of $5.31 per share, on revenue of $64.4 billion. Additionally, revenue increased 7.1% on a year-over-year basis.

McKesson had a solid start to fiscal 2023. Our results this quarter demonstrate the strength of our streamlined portfolio and successful execution as a diversified healthcare services company,” commented Brian Tyler, CEO. “Our talented associates continue to deliver exceptional performance, and we remain confident that our strategy positions McKesson for long-term growth and value creation.

MCK stock chart
Source: TD Ameritrade TOS

Northrop Grumman Corporation (NOC Stock)

Following that, we have Northrop Grumman (NOC). For starters, the company is an American aerospace and defense technology company headquartered in Falls Church, Virginia. Northrop Grumman ranks among the world’s largest defense contractors, with over 125,000 employees and operations in 30 countries. Northrop Grumman’s products include aircraft, spacecraft, radar systems, and missiles.

At the end of July, Northrop Grumman reported Q2 earnings of $6.06 per share on revenue of $8.8 billion. This is in comparison with the consensus estimates of $6.03 earnings per share on revenue of $9.1 billion. Meanwhile, the company did reaffirm its 2022 guidance, providing an earnings estimate range of $24.50 to $25.10 per share, on revenue of $36.54 billion. Year-to-date shares of NOC stock have advanced over 26%, and the stock is currently trading at $486.94 per share on Tuesday afternoon.

Kathy Warden, CEO and President commented in her note to shareholders, “Northrop Grumman’s strategy to provide differentiated solutions in our customers’ highest priority areas is delivering results. In the second quarter, we had outstanding bookings and backlog growth, and strong segment operating margins, Demand for Northrop Grumman products and our operational performance remain strong. We are affirming our full year guidance, as we see the tight labor market, that has impacted our growth in the first half, beginning to ease in the second half of the year.” Considering all of this, is NOC stock a buy right now?

NOC stock chart
Source: TD Ameritrade TOS

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


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