Cover story: Barron’s list of best income investments for 2019 includes picks from 11 sectors that should deliver yields from three to 10 percent: MLPs, junk bonds, European dividend stocks and funds, U.S. dividend stocks and funds, preferred stock, REITs, telecoms, municipal bonds, utilities, investment-grade bonds, Treasuries.
Features: 1) Positive on AAPL: Despite the company’s recent guidance bombshell, investors should hold onto their shares—the stock is currently tied to iPhone sales, but its future is tied to a lucrative installed base of about 1.3B devices; 2) Positive on T, DXC, MS, MYL: These four humbly price stocks are worth a look by bargain hunters—they have single-digit P/E ratios, and have received fresh Buy recommendations from analysts during the past three months; 3) Roy Johnson, known for his success at reinventing AAPL’s stores and his failure to rejuvenate JCP, is running a Silicon Valley startup called Enjoy that hopes to make online shopping less impersonal; 4) A growing number of companies are working to build more inclusive and diverse workplaces, bolstered in party by an expanding body of research about the benefits of such efforts; 5) “As sustainable investing evolves, it looks more and more like good, old-fashioned stock picking.”
Tech Trader: The Consumer Electronics Show, which kicks off in Las Vegas on January 6, comes “against a backdrop of a shaky stock market, tariff talks with China, and threat of a recession roiling the tech and chips markets.” Trader: The stock market isn’t at the ‘end of bear market’ cheap, says Jim Paulsen of Leuthold Group, but is at a level that offers some potential upside again, provided inflation and interest rates stop rising; Columnist Ben Levisohn says his best call last year was a recommendation on March 3 to sell LB, shares of which continued to fall amid changing consumer tastes; “Utility stocks lived up their reputation as a solid defensive play in 2018, and they have the potential to keep outperforming, especially if more volatility ensues.”
Mutual Fund Quarterly: 1) Given enough time and positive shifts in corporate policy, ESG investors should be able to forgives companies that have engaged in egregious behavior; 2) Q&A with Carson Block, founder of Muddy Waters, who talks about his approach to investing according to environmental, social, and governance factors; 3) Barron’s list of the top 20 sustainable mutual funds—all of which beat the market by focusing on good corporate governance—is topped by Polen Growth, Fidelity Focused Stock, and Calvert Equity; 4) Jerome Dodson, founder of Parnassus Investments and a major player in sustainable investing, takes far more than three or four metrics into account when deciding whether to buy a stock, and he rarely wavers from his own strict guidelines; 5) Of the 78 actively managed U.S. stock funds that have a sustainability goal of some sort, 54 did not make Barron’s list of the most sustainable funds, some because of their small size, others because they had an average or below-average sustainability rating.
European Investor: Positive on Fugro: Netherlands-based company is a good contrarian play: a small cap hit hard by the drop in oil prices and Europe’s yearlong economic and geopolitical woes.
Emerging Markets: Geopolitics are top of mind for emerging markets investors this year, but national politics in countries such as Brazil—where newly elected president Jair Bolsonaro may push through market reforms—also loom large.
Commodities: “African swine flu, possibly brutal winter weather, and falling beef production could propel prices for cattle futures more than 15% higher over the next two quarters or so.”
