The year 2015 has been full of ups and downs for the U.S. economy. Though the economy is said to be growing at a moderate pace, the latest robust consumer spending data as well as employment report turned out to be the positives, sparking the chances of an interest rate hike decision in this year’s final Federal Reserve meeting in December.
While the next month is anticipated to mark the end of the Fed’s accommodative policy, the move will come slowly and steadily without shocking the system as hinted by Fed Chair Janet Yellen on Monday.
“We all hope and expect that the economy will continue to expand, that the jobs market will continue to make progress, and that inflation will move toward our 2 percent price stability objective,” Yellen wrote. “If that is the case, my colleagues and I have indicated it will be appropriate to begin to normalize interest rates.”
Though expectations of a strong pick up in fourth-quarter economic growth are bleak, investing in companies that are expected to significantly grow their earnings can help us avert the drag of a strengthening dollar, lower business spending as well as slower U.S. gross domestic product growth.
Along with strong earnings growth prospects, investing in stocks that have already proven their worth by successfully beating the market so far this year could be a good idea. Though some investors may be wary of purchasing such high-priced stocks, high valuations and rise in share prices do not always mean that the stock has reached its ultimate potential.
A solid price increase implies robust demand for the stock, which is often explained either by a good fundamental performance or some positive news. And these may keep boosting the stock price. A company with strong fundamentals and future prospective growth can easily carry the momentum forward.
5 Stocks to Bet on
Founded in 1994, Washington-based Amazon.com Inc. (AMZN - Analyst Report) is a well-known market leader, which operates as an online retailer in North America and internationally. This Zacks Rank #2 (Buy) company seeks to be the world’s most customer-centric platform, where customers can find and discover anything they may want to buy online.
Compared with the S&P 500 index’s year-to-date return of 1.3%, Amazon’s investors were rewarded with more than a two-fold increase so far this year justifying its strong international expansion along with robust performance of its cloud services arm. Further, the company’s projected EPS growth (F1/F0) of 447.6% signals continuation of an uptrend in the price chart in the near term.
Nevada-based Boyd Gaming Corp. (BYD - Snapshot Report) is a leading diversified owner and operator of 22 gaming entertainment properties located in Nevada, Illinois, Indiana, Iowa, Kansas, Louisiana, Mississippi and New Jersey. This Zacks Rank #1 (Strong Buy) organization operates as a multi-jurisdictional gaming company in five segments: Las Vegas, Downtown Las Vegas, Midwest and South, Peninsula and Borgata.
