The stock market has taken a beating this year amid sky-high inflation and the Fed’s series of rate hikes. The CBOE Volatility Index has gained 59.2% year-to-date. However, there are signs that the bulls will overtake the bears in the new year.
Additionally, Morgan Stanley’s Mike Wilson opines that the bear market in U.S. equities may conclude sooner than investors think. On the other hand, according to the Bureau of Economic Analysis, the U.S. economy’s third-quarter GDP increased at a 2.6% annualized pace, surpassing consensus estimates and easing recession fears.
Furthermore, benchmark indices have posted gains over the past month. The S&P 500 climbed 4.4%, while the Dow Jones Industrial Average gained 9.9%.
Given the backdrop, investors should consider buying fundamentally sound stocks Pfizer Inc. (PFE), Ryerson Holding Corporation (RYI), and Kronos Worldwide, Inc. (KRO) in the fourth quarter. These stocks are trading under $50.
Pfizer Inc. (PFE)
Pharmaceutical major PFE discovers, develops, manufactures, markets, distributes, and sells biopharmaceutical products worldwide. It offers medicines and vaccines in various therapeutic areas.
On October 20, 2022, PFE and Erasca, Inc. (ERAS), a clinical-stage precision oncology company, announced a clinical trial collaboration and supply agreement for the CDK4/6 inhibitor palbociclib (IBRANCE®). The co-developed trial aims to discover advanced treatment alternatives for colorectal cancer.
Also, on October 12, 2022, PFE and BioNTech S.E.’s (BNTX) received the U.S. Food and Drug Administration’s Emergency Use Authorization for a 10-µg booster dose of Omicron BA.4/BA.5-adapted bivalent COVID-19 vaccine in children. The approval is expected to boost the companies’ revenue generation.
PFE’s revenues came in at $27.74 billion for the second quarter that ended July 3, 2022, up 46.8% year-over-year. Its net income came in at $9.91 billion, up 78.1% year-over-year, while its EPS came in at $1.73, up 76.5% year-over-year. Moreover, its income from operations came in at $11.45 billion, up 64.7% year-over-year.
For 2022, analysts expect PFE’s revenue to be $99.60 billion, indicating a 22.5% year-over-year rise. In addition, the company’s EPS is expected to increase by 44.3% year-over-year to $6.38 in 2022. It surpassed EPS estimates in all the trailing four quarters. Over the past year, the stock has gained 6.5% to close the last trading session at $45.74.
PFE’s POWR Ratings reflect this promising outlook. The POWR Ratings assess stocks by 118 different factors, each with its weighting. PFE has an overall A rating, which equates to a Strong Buy in our POWR Ratings system.
Also, the stock has an A grade for Value and a B for Quality. Within the Medical – Pharmaceuticals industry, it is ranked #9 out of 162 stocks. Click here for the additional POWR Ratings for Growth, Momentum, Stability, and Sentiment for PFE.
Ryerson Holding Corporation (RYI)
RYI and its subsidiaries process and distribute industrial metals in the United States, Canada, Mexico, and China. It offers various products in carbon steel, stainless steel, alloy steel, aluminum, nickel, and red metals in different shapes and forms.
On September 1, 2022, RYI acquired Howard Precision Metals, Inc., one of the largest aluminum distributors in the Midwest. Mike Burbach, RYI’s CEO, said, “Howard’s processing capabilities complement Ryerson’s existing non-ferrous franchise, and we are excited to recognize these synergies as we welcome them to the Ryerson Family of Companies.”
RYI’s net sales came in at $1.74 billion for the second quarter that ended June 30, 2022, up 22.9% year-over-year. Its net income increased by 74% year-over-year to $196.40 million, while its EPS increased by 75.3% year-over-year to $5.10.
Street expects RYI’s revenue to increase 9.6% year-over-year to $6.22 billion. Its EPS is expected to increase 74.4% year-over-year to $13.01 in 2022. It surpassed EPS estimates in all four trailing quarters. Over the past year, the stock has gained 36.3% to close the last trading session at $34.04.
RYI has an overall A rating, which translates to a Strong Buy in our proprietary rating system.
RYI has an A grade for Value and a B for Growth, Sentiment, and Quality. Within the B-rated Industrial – Metals industry, it is ranked #3 out of 35 stocks. Click here for the additional POWR Ratings for Momentum and Stability for RYI.
Kronos Worldwide, Inc. (KRO)
KRO produces and markets titanium dioxide pigments (TiO2) in Europe, North America, the Asia Pacific, and internationally. The company has TiO2 in two crystalline forms, rutile and anatase, to impart whiteness, brightness, opacity, and durability for various products.
KRO’s net sales came in at $565.30 million for the quarter that ended June 30, 2022, up 18.1% year-over-year. Its net income came in at $45.90 million, up 78.6% year-over-year, while its EPS came in at $0.40, up 81.8% year-over-year.
KRO’s revenue is expected to increase 8.6% year-over-year to $2.11 billion in 2022. Its EPS is expected to increase 17.3% year-over-year to $1.15 in 2022. It surpassed EPS estimates in three of four trailing quarters. The stock has gained marginally over the past month to close the last trading session at $9.45.
KRO has an overall B rating, which translates to a Buy in our POWR Ratings system. It has an A grade for Value and a B for Quality.
KRO is ranked #19 out of 87 stocks in the B-rated Chemicals industry. Click here to check additional ratings for KRO (Growth, Momentum, Stability, and Sentiment).
PFE shares were trading at $46.26 per share on Friday morning, up $0.52 (+1.14%). Year-to-date, PFE has declined -19.80%, versus a -18.50% rise in the benchmark S&P 500 index during the same period.
About the Author: Riddhima Chakraborty
Riddhima is a financial journalist with a passion for analyzing financial instruments. With a master's degree in economics, she helps investors make informed investment decisions through her insightful commentaries.
Here Are 3 Stocks to Buy Under $50 in Q4 StockNews.com
