3 stocks for low-risk investors

Successful investment does not involve excessive risk. There are many companies that provide shareholders with compelling upside without high risk and volatility.

Here, we will explore three low-risk investment opportunities to enhance your investment portfolio.

1. Nike-Digital Power

in Nikeof (New York Stock Exchange: OF) In the latest earnings report, the company’s revenue fell by 1%. Due to the pandemic, many of Nike’s distributors have closed their business, and this downturn in decline is actually encouraging.

In addition, the company’s digital sales increased by 82%, reflecting strong demand for its products in any environment. This is encouraging for several reasons: The shift allowed Nike to improve inventory efficiency by providing a clearer and more comprehensive product demand map. Nike also expects this digital shift will accelerate the growth of its ladies and apparel categories.

Perhaps the most important by-product of digital shifts is the simultaneous increase in profits. The company’s digital revenue gross margin is approximately 10% higher than wholesale revenue. CEO John Donahoe predicts that as the company automates throughout the organization, the increase in profitability will continue to expand.

Donahoe is working with Current service with EBay. Now, he is doing similar things at Nike.

2. CVS Health continues to impress

CVS Health (NYSE: CVS) Revenue growth and operating margin growth in the most recent quarter. Revenue increased by 3.5% to $67.1 billion, and operating profit margin expanded from 4.5% to 4.8%. Encouragingly, the company raised its 2020 operating cash flow guidance from US$11 billion to US$11.5 billion, and then to US$12.75 billion to US$13.25 billion. For companies, the improved guidelines can be attributed to the number of prescriptions and more diagnostic tests, especially for COVID-19. Despite the good quarterly performance, CVS currently has a P/E ratio of 11.5 times. why?

As a physical chain, CVS is vulnerable to the threat of competition from e-commerce. The company’s decision to transform its store into HealthHUB is one of its main responses to this threat. HealthHUB will act as a medical service center for routine services, such as blood tests, physical examinations and so on.Although a company likes Amazon It is easy to ship goods sold by CVS in its stores, but not the services provided by CVS itself.

In addition to HealthHUB, CVS also began to expand its telemedicine business. In the past two years, the company’s professional digital solutions have grown rapidly at a compound annual growth rate (CAGR) of 25%. Since the beginning of the pandemic, 40% of CVS’s professional orders have been placed digitally. Obviously, consumer preferences are changing, and CVS is positioned to provide care for patients anytime, anywhere.

3. Qualcomm is on fire

Qualcommof (Nasdaq: QCOM) The company is clicking on all cylinders. The semiconductor company reported a 35% revenue growth in the most recent quarter, breaking expectations. In addition, the company expects revenue for the next quarter to be between US$7.8 billion and US$8.6 billion, while it is expected to be slightly more than US$7.1 billion, and this year’s revenue will increase by 38.5%. Thanks to a staggering 41.3% operating profit margin, the company’s operating cash flow increased by 41%.

The semiconductor industry has been growing steadily for decades. With the promotion of 5G globally, the semiconductor industry should continue to grow at a faster rate. Although semiconductors are traditionally used in mobile phones and laptops, the popularization of 5G will eventually lead to digitization of everything. Factories, farms and other sectors will increasingly rely on semiconductor technology.

YCharts global semiconductor sales data

CEO Steve Mollenkopf believes that thanks to the connectivity provided by the Internet of Things (IoT) and its reliance on semiconductors, his company is ready to earn new 5G revenue in the next few years source. According to Mollenkopf, this will drive revenue growth in the long term.

In addition, Apple’s 5G mobile phones use Qualcomm chips to run. For the company, this is a very good omen, it is now possible to buy new 5G phones. With the successful launch of Apple, so should Qualcomm.

Despite the strong and optimistic financial performance, the company’s price-to-earnings ratio is still less than 19 times, which is very attractive for the growing technology stocks.

The perfect balance between risk and reward

Here, we have three companies that provide investors with strong fundamentals without excessive risk. All three have the ability to create meaningful returns for shareholders, and all three should do so without all the dramatic circumstances associated with high-risk investments.