Defensive Stocks to Consider Amid Geopolitical Turmoil

Strategic Insights -

With the Russia-Ukraine war injecting volatility into the equity market, investors may be turning to defensive stocks for stability. A list of defensive names compiled by Goldman Sachs suggests Microsoft, Johnson & Johnson, Visa, Procter & Gamble, and other companies have a long history of beating the overall market. Morningstar analysts are bullish on these stocks, citing strong earnings and growth prospects.

Key Takeaways:

  • Microsoft, Johnson & Johnson, Visa, Procter & Gamble, Mastercard, AT&T, UnitedHealth, Verizon, Coca-Cola, and Merck are defensive stocks recommended by Goldman Sachs.
  • Morningstar analyst Dan Romanoff is bullish on Microsoft, citing solid earnings and growth prospects, with a fair value estimate of $352, compared to the current price of $294.59.
  • Johnson & Johnson's fourth-quarter results were reassuring, with Morningstar analyst Damien Conover citing solid future growth and a wide moat, with a fair value estimate of $167, compared to the current price of $158.14.
  • These defensive stocks have a history of beating the overall market, making them attractive to investors seeking stability amid geopolitical turmoil.
  • Analysts at Morningstar are optimistic about the growth prospects of companies like Microsoft and Johnson & Johnson, driven by strength in personal computing and innovation in the drug and device groups.
  • The list of defensive stocks from Goldman Sachs provides a starting point for investors looking for stability and relatively lower volatility.

Statistics:

  • Microsoft has a fair value estimate of $352, according to Morningstar analyst Dan Romanoff.
  • Johnson & Johnson's fair value estimate is $167, according to Morningstar analyst Damien Conover.
  • The list of defensive stocks from Goldman Sachs includes 10 companies with a history of beating the overall market.
  • The current prices of the companies mentioned are $294.59 (Microsoft), $158.14 (Johnson & Johnson), and others.
  • Geopolitical turmoil such as the Russia-Ukraine war can inject volatility into the equity market, making defensive stocks an attractive option for investors seeking stability.

Sources:

  • CNBC (https://www.cnbc.com/2022/02/24/here-are-some-choices-for-stock-investors-during-this-geopolitical-turmoil.html)
  • Morningstar, commentary by Dan Romanoff