Three Beauty Investments to Purchase for Income as Putin Escalates War
By: Paul Dykewicz,
Three beauty investments to purchase for income offer strong potential to outperform the market even though Russia’s President Vladimir Putin announced plans to call up 300,000 civilians to go to serve in the country’s military to replenish its attack against Ukraine that began Feb. 24.
The three beauty investments to purchase for income offer hope for those who desire a chance to grow their money to avoid succumbing to inflation, a recession and continuing fallout of Russia’s invasion. All three beauty investments to purchase for income allow people to invest in companies that traditionally remain important to their customers who want to present themselves attractively, even when negative circumstances disrupt their lives.
Further, these three beauty investments to purchase for income give users of such products and services enhanced self-esteem and an escape from turbulent times. In troubling times, such satisfying results can spur sales.
“Beauty products are among the consumer staples that tend to do well through recessions and inflation,” said Bob Carlson, a pension fund chairman who also leads the Retirement Watch investment newsletter. “Their customers tend to buy the products except in the worst times.”
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Three Beauty Investments to Purchase for Income as Putin Orders 300,000 Civilian into War
Russia’s President Putin announced that he would ask roughly 300,000 military reservists to join the war in Ukraine that he prefers to describe as a “special military operation.” Those called up include many reserve officers, including some over the age of 60, who had retired from service.
In addition, Russia’s government announced it will hold four referendums in parts of Ukraine that are currently under Russia’s control, even though such action violates international law, according to the United Nations.
Despite the evils of war that has killed tens of thousands of people in Ukraine, beauty and personal care grew 7% year over year (y/y) in 2021. As consumers exited the pandemic, the beauty and personal care category was ready for accelerated growth globally as consumers bought high-quality, premium products and found more occasions to use fragrance and makeup, while prioritizing self-care and placing a high value on clean beauty, BofA reported.
Beauty products companies have been giving positive earnings reports and outlooks, while the management of many other companies have shared “pessimistic” forecasts, Carlson counseled. Beauty products stocks are included in a diversified consumer staples portfolio, with such stocks able to hold up well in recessions and inflation due to their pricing power for coveted products.
Bob Carlson, head of the Retirement Watch newsletter, meets with Paul Dykewicz.
ETF Is One of Three Beauty Investments to Purchase for Income
A good way to establish a diversified consumer staples portfolio is through an exchange-traded fund (ETF), Carlson counseled. He suggested iShares U.S. Consumer Staples ETF (IYK).
The ETF’s 52 stocks are led by Procter & Gamble (NYSE: PG), Coca-Cola (NYSE: KO), PepsiCo (NASDAQ: PEP), CVS Health (NYSE: CVS), and Mondelez International (NASDAQ: MDLZ). About 64% of the fund is in its 10 largest positions. It has slid lately and may be poised for a strong recovery when the market turns up.
Chart courtesy of www.stockcharts.com
Procter & Gamble Picked as One of the Three Beauty Investments to Purchase for Income
Jim Woods, who heads the Intelligence Report investment newsletter, has an Income Multipliers portfolio in that publication that includes Procter & Gamble, a Cincinnati, Ohio-based company with diversified consumer products that include many focused on beauty, grooming and cleanliness. Plus, Procter & Gamble offers strong cash flow that allows it to provide its shareholders an alluring dividend yield of 2.7% compared to the paltry payouts of many others.
In addition, Procter & Gamble has a rising dividend policy. In fact, the company has boosted its dividend annually for the past 66 years. Procter & Gamble, founded in 1837, features 22 brands that generate at least $1 billion in sales.
Chart courtesy of www.stockcharts.com
Investing Involves Managing Risks
Potential risks to Procter & Gamble include inflation weighing on its profit margins, weakened sales from emerging markets in China and the effects of a strong U.S. dollar, said Michelle Connell, president and owner of Dallas-based Portia Capital Management.
Another risk is that consumers may use private-label and generic products more than those of Procter & Gamble, Connell continued. Even though the stock is down so far this year, it has a potential to ascend, she added.
“I think PG would be good here,” Connell continued, especially due to its “reasonably priced” cosmetics, beauty and grooming products.
Former portfolio manager Michelle Connell, CEO, Portia Capital Management
“I don’t like being early on stocks when they have disappointed so much,” Connell advised.
Procter & Gamble has a very strong and diversified consumer product portfolio, while trading at a bit of a discount after dropping 14% since the start of 2022. However, Connell projects that PG has an upside of 20%.
Giant Retailer Walmart Is Another of the Three Beauty Investments to Purchase for Income
Walmart Inc., a superstore chain headquartered in Bentonville, Arkansas, has slumped since mid-May but now is showing some resiliency amid the market pullback in recent months. Investors seeking to buy Walmart at a discount should take into account the stock is down since the start of the year but has been climbing since mid-May.
Walmart is one of the few stores that’s likely to benefit from rising inflation, as the store offers the best discounts of any major retailer,” said Jim Woods, leader of the Intelligence Report newsletter, plus the High Velocity Options and Bullseye Stock Trader advisory services.
Woods told me he recommends Walmart in the Income Multipliers portfolio of his Intelligence Report newsletter due to its history of raising annual dividends and its five-year total return of more than 71%.
Chart courtesy of www.stockcharts.com
U.S. COVID Cases Exceed 96 Million
COVID-19 cases and deaths can significantly impact supply and demand for beauty products and many others. Investors who monitor COVID-19 outbreaks and lockdowns position themselves to foresee supply chain problems.
In the wake of China locking down more than 70 cities fully or partially to preserve its COVID-19 zero-tolerance policy, 27 people were killed and 20 more were injured when a quarantine bus overturned on a mountain road last Sunday. China reported 918 new COVID-19 infections for Sept. 23, including 188 symptomatic and 730 asymptomatic, according to the country’s National Health Commission. It marked an increase from a day earlier on Sept. 22, when 901 new cases were reported, including 175 symptomatic and 726 asymptomatic infections.
U.S. COVID-19 deaths rose for the eighth consecutive week by 3,000 or more, jumping to 1,056,373, as of Sept. 23, according to Johns Hopkins University. Cases in the United States climbed to 96,056,075. America remains the nation with the most COVID-19 deaths and cases.
Worldwide COVID-19 deaths totaled 6,535,438, as of Sept. 23, according to Johns Hopkins. Global COVID-19 faded to a gain of less than 3.4 million for the second straight week, down from almost 4 million three weeks ago. The new worldwide case total reached 614,512,193.
Roughly 79.5% of the U.S. population, or 263,812,108, have received at least one dose of a COVID-19 vaccine, as of Sept. 21, the CDC reported. Fully vaccinated people total 224,980,931, or 67.8%, of the U.S. population, according to the CDC. The United States also has given at least one COVID-19 booster vaccine to 109.6 million people.
The three beauty investments to purchase for income appear primed to shine. Despite high inflation, the risk of recession fallout after 0.75% rate hikes by the Fed in June, July and earlier this week, as well as other potential hikes ahead, the three beauty investments to purchase for income pay dividends and offer the allure of share price gains.
Paul Dykewicz, www.pauldykewicz.com, is an accomplished, award-winning journalist who has written for Dow Jones, the Wall Street Journal, Investor’s Business Daily, USA Today, the Journal of Commerce, Seeking Alpha, Guru Focus and other publications and websites. Paul, who can be followed on Twitter @PaulDykewicz, is the editor of StockInvestor.com and DividendInvestor.com, a writer for both websites and a columnist. He further is editorial director of Eagle Financial Publications in Washington, D.C., where he edits monthly investment newsletters, time-sensitive trading alerts, free e-letters and other investment reports. Paul previously served as business editor of Baltimore’s Daily Record newspaper. Paul also is the author of an inspirational book, “Holy Smokes! Golden Guidance from Notre Dame’s Championship Chaplain,” with a foreword by former national championship-winning football coach Lou Holtz. The book is great as a gift and is endorsed by Joe Montana, Joe Theismann, Ara Parseghian, “Rocket” Ismail, Reggie Brooks, Dick Vitale and many others. Call 202-677-4457 for multiple-book pricing.