Seeking Alpha Stocks To Buy

When interest rates hit record lows in 2020, who would have thought inflation would reach 40-year highs shortly thereafter Investors rotated from bear markets to bull markets growth stocks to value stocks. Powell's recent \"disinflationary\" remarks were seen as positive, and the market sentiment received an uptick. But the Fed has made crystal clear it plans to raise rates and keep them higher for longer. So don't fight the Fed!

Some investors believe that the Fed may appear more dovish as inflation and costs decline, but the Fed works to tame inflation. Investors may best be served by considering higher-quality companies that offer solid dividend yields as a hedge in this macro environment. The best route for acquiring stocks with the safest dividends is to use the Top Quant Dividend Stocks screen. With that thought in mind, this particular article aims to reach a little outside of the parameters of the safest dividend stocks and obtain stocks that offer a combination of capital appreciation potential, high dividend yields, dividend growth, dividend safety, and solid overall fundamentals.

Perhaps not the highest-ranked, these stocks still have good Dividend Safety grades. The intent of this article is to shoot for both high yield and safety - two investment characteristics that often contradict each other. Dividend investing matters for a number of reasons.

Investment Alternative - Income-oriented investors may want to invest in something other than high-growth securities and are willing to consider dividend-paying stocks that take on equity market risk.

Because inflation has resulted in investors budgeting for every dollar, building a portfolio that generates income offers an opportunity to hedge against potential downturns. Because not all dividend stocks are created equal, I have selected three dividend stocks in varied sectors whose overall Quant Ratings & Factor Grades complement their high yields.

Better-than-expected economic data has signaled to some investors that there may be less recession risk and a smoother ride in 2023 than anticipated. CPI has trended lower, and solid jobs reports have the markets excited. But Fed Chair Powell's mention of disinflation does not mean that investors are in the clear. Powell specifically cautioned that \"these are the very early stages of disinflation. It has a long way to go.\" Whether you believe he's dovish or hawkish may or may not make a difference. What's clear is that the Fed plans to continue to temper costs. Whether in an up or down economy, the right high-yielding dividend stocks can help be the monsters needed to bite back against inflation eating at your portfolio.

Whether or not we're in an economic environment experiencing disinflation remains to be seen. Being preemptive with stocks like SQM, BLN, and PRU, each is collectively strong on fundamentals like valuation, growth, profitability, and revisions, offering benefits during periods of high inflation. Additionally, when seeking investments that offer a steady income stream, each of my picks possesses a strong forward dividend yield, outstanding overall dividend scores, and a significant excess cash flow.

Each of these picks is from a different sector, which is a great way to diversify a portfolio. With average four-year yields near or over 4%, investors should be able to thrive in a rising or falling environment without sacrificing quality or growth during market swings. Not only do my picks offer solid value, their strong profitability, and significant cash help ensure shareholders that these stocks' dividend payout should remain consistent. If you prefer alternate dividend stocks with higher Dividend Safety or strong Dividend Growth grades, or perhaps would like to customize your picks into the desired sectors you like, consider using Seeking Alpha's 'Ratings Screener' tool.

For over a decade, small-cap stocks have outperformed large-caps. To start the new year, iShares Russell 2000 ETF (IWM) is up 6.81%, outperforming the large-cap stocks YTD, as evidenced in the chart above, and small-caps are very attractive on a valuation basis. Typically smaller-sized companies with market capitalization between $300 million and $2B tend to be some of the more risky equity classes. In diversifying even further, my favorite picks for this article are all foreign stocks, quant-rated Strong Buys, and selected and sorted by market caps $1B or greater using a screen called Top Stocks Under $10. While I generally do not recommend stocks under $10, the key to smart investing is identifying stocks that possess strong fundamentals and, in this case, with low prices.

High inflation and negative macroeconomic factors make investing in the current environment difficult. Fluctuating currencies, high inflation, and interest rates pose challenges to many companies. Because small-cap companies tend not to be as profitable as larger ones, they typically go through high growth periods and possess higher leverage. In rising rate environments, this can pose problems to smaller companies with a lot of leverage, as they tend to sell off sharply when rising interest rates are threatened. Factor in fear of slowdown, recession, or contraction; small-cap stocks typically sell off more from a day-to-day trading perspective than large caps.

Because globalized economies are in a rut due to inflation, now may be a good time to seek out bargains, especially international stocks and/or emerging markets that have the potential to deliver upside over the long term. During periods of downturn, bargain hunting for attractive stocks along with collective financial traits like valuation, growth, EPS revisions, profitability, and momentum can pay off handsomely.

Despite the global recession risk in 2023, the bulls and my quant ratings indicate ASX is a strong buy, and improving supply chains can serve as tailwinds. Despite currency fluctuations and higher costs amid an unfavorable macro environment, ASX was able to offset the impacts given its local currency depreciation and passing higher costs off onto consumers. Last year was rough on many stocks, especially tech, and ASX bottomed in early July, trading at $4.45 but has managed to recover, trading near its 52-week high of $7.82.

Like U.S. stocks, international companies have been affected by high inflation, rising interest rates, geopolitical concerns, and slowing economic growth. In addition to the war in Ukraine, further challenges include potential increasing headwinds from China, lower-than-expected profits from companies around the globe, supply chain issues, volatile energy prices, and central bank tightening. Because these issues are well known, many of the factors may be discounted in the small-cap segment, and this may lead to bargains in the new year.

In my opinion, undervalued small-cap stocks with strong growth potential can offer upside in the new year. And although some small caps have fewer profits on the books compared to large caps, those with strong investment fundamentals and solid balance sheets, as showcased by our Quant System, can offer the risk-reward needed for portfolios. NWG, CPG, FUJHY, RLX, and CAAP are five unique companies that may help to diversify your portfolio into the new year. If international stocks do not fit your risk tolerance, you can choose from many more Top Stocks Under $10.

As the riskiest of U.S. equity asset classes, small caps can have whipsawing price swings, especially amid rising rates that can affect the outlook of individual stocks. Where the markets reacted well initially to the latest 75-basis point hike, cheap stocks with a lot of leverage can quickly sell off sharply when rising interest rates are threatened, and emotions dictate the markets. But over long periods, small-caps have paid out handsomely, especially those based on our Quant System. And where past performance is not a guarantee of future results, a focus on stocks with attractive collective financial traits like valuation, strong growth, EPS revisions, profitability, and momentum, can offer upside for a portfolio. These characteristics are currently found in the below five stocks under $10.

Like many stocks that fell from June to July, Quest experienced a decline after missing Q1 earnings. Since then, the stock has been on an uptrend, focusing on differentiated services and accounts that have increased gross margins and profits.

Stocks trading under $10 with discounted valuations and strong growth can offer portfolios upside. Risk can bring reward, but stocks with strong investment fundamentals can take a bite out of the risk to help make well-informed investment decisions. Historically, small-cap stocks tend to outperform large-cap stocks in the long run. Although small-caps tend to be more volatile (as we saw with the September price swings), the stock picks mentioned here were selected by identifying low-cost stocks with strong fundamentals using our Quant System.

When considering the most profitable stocks to invest in, it is crucial to check out earnings quality and fundamental metrics beyond P/E ratios, which are most susceptible to misconception. Look to EBITDA margins, which are less vulnerable to accounting manipulation and are often normalized by data vendors.

While there are always risks when investing, especially during extreme fear and volatility, this article encourages investors to seek out stocks with great overall metrics and a focus on profitable stocks. Diversification in the stock market is key and ensuring you find companies with low debt, enormous amounts of cash from operations, high returns on equity, significant EBITDA margins, and solid, long-term profitability outlooks, which is precisely what the stocks featured here. Strongly consider our top picks, ATKR, CF, CAT, AVGO, and CMCSA, or use our Quant System to find stocks with strong fundamentals.

As we look at the decline in international markets like China, investors willing to take some risk