Stocks to buy

Don’t expect the massive volatility we’re experiencing to end soon. That’s why “A”-rated stocks are crucial to your portfolio now.

While the pandemic and then the Russian invasion of Ukraine have been extremely disruptive events in the market, the fact is, what we’re undergoing right now has as much if not more to do with 2008’s crash as it does current events.

Remember, back then the entire global financial system was on the brink of collapse. The world’s top central banks all focused on stopping it by dropping rates to near zero to provide liquidity to financial companies and backstop the mortgage markets.

That has provided us with 13 years of a low-growth, low-interest rate environment that helped the global banking system recover and kept companies and individuals’ access to capital flowing.

But that’s changing now. And this transition is just as unique as what happened in 2008. We’ve never been here before.

Here are seven “A”-rated stocks to buy:

  • Amphastar Pharmaceuticals (NASDAQ:AMPH)
  • Black Stone Minerals (NYSE:BSM)
  • Sociedad Química y Minera (NYSE:SQM)
  • Commercial Metals (NYSE:CMC)
  • Matson (NYSE:MATX)
  • Cactus (NYSE:WHD)
  • CONSOL Energy (NYSE:CEIX)

“A”-Rated Stocks to Buy: Amphastar Pharmaceuticals (AMPH)

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On March 10, AMPH announced its Q4 numbers. It beat on revenue and earnings. That’s becoming a theme for this small — market capitalization of $1.6 billion — pharmaceutical company that focuses on technically challenging drug delivery solutions.

Its most well-known product is Primatene Mist, an inhaler for asthma sufferers. But AMPH is constantly looking to pair its proprietary inhalation, injectable and intranasal therapies with novel — and common — drugs.

The key reason these dosing methods make a big difference is that medicine is more quickly and evenly absorbed into the blood stream than it is through pills. And that improved uptake means you don’t have to use as much medication to get the same result.

The stock has had a fine year. It’s gained 87% in the past 12 months and 48% year to date. And it’s in a unique niche, relatively undisturbed by current market machinations.

This stock has an “A” rating in my Portfolio Grader.

Black Stone Minerals (BSM)

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When oil remains above $100 a barrel and natural gas prices are also at multi-year highs, one of the best places to be is in the exploration and production (E&P, or upstream) sector of the energy patch. That’s because there’s a fixed cost per barrel of getting the oil headed downstream. The higher the price of oil, the bigger the profit margin.

And that’s precisely where BSM is. It’s not a huge player, but its $2.7 billion market cap makes it more than a wildcatter. Plus, it’s set up as a limited partnership, so shareholders receive a cut of net profits in the form of dividends. Right now, it’s paying a hefty 7.2% dividend.

What’s more, BSM stock is up 18% year to date and is still trading at a price-to-earnings ratio of 16.

This stock has a triple-“A” rating in my Portfolio Grader.

“A”-Rated Stocks to Buy: Sociedad Química y Minera (SQM)

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A couple decades ago, one of the big sectors to have exposure in was agriculture. Potash, potassium, nitrogen and other chemicals, whether harvested, converted or processed, were the way to go for solid long-term growth.

That’s still the case and is much of the reason why this Chile-based chemical company has a very respectable $22 billion market cap and lineage dating back six decades.

But now, the agriculture sector is nice, but there’s one new chemical that’s worth equally as much: lithium. Yes, SQM is a leading lithium miner. And given the growing EV market and energy storage in general, this is a great play a key reason it’s one of my “A”-rated stocks.

SQM stock has gain 46% year to date, and it has gained 33% in the past 12 months. Its P/E is a little high, but it’s not surprising its trading at a premium given its business. And earnings will certainly expand for many quarters to come.

This stock has an “A” rating in my Portfolio Grader.

Commercial Metals (CMC)

Source: Postmodern Studio / Shutterstock.com

Another significant Old Economy trend that is making its way back to life is the steel and metals industry. CMC has exposure to the U.S. and market and Europe with new steel as well as significant recycling operations.

Given both continents have massive infrastructure stimulus plans in place, there will be plenty of demand for CMC products for many years to come. And one of the best things about CMC is it has been in the business since 1915, so it has seen plenty of ups and downs over the decades.

CMC stock is 44% in the past 12 months and 12% year to date. Yet it trades a P/E just below 9. And it has a 1.4% dividend.

This stock has a triple-“A” rating in my Portfolio Grader.

“A”-Rated Stocks to Buy: Matson (MATX)

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Sailing the seas since 1882, MATX is specialized shipping and logistics company that does a lot of business out of the west coast of the U.S. (and Alaska) to the South Pacific, Hawaii and Asia. Obviously, these routes have become significantly more important as the years have gone by.

But MATX was never interested in becoming a global force. The world has grown up around its routes and that has turned this company into a credible force with a $4.8 billion market cap.

Given the current supply chain issues and the pent up demand to clear the ports on both sides of the Pacific, MATX is bound to see a lot more business for years to come. Plus, this typically seasonal business is likely to see demand grow all year around.

MATX stock has gained 57% in the past 12 months, 30% year to date. Yet it still trades at a surprisingly low P/E of just 5.

This stock has a triple-“A” rating in my Portfolio Grader.

Cactus (WHD)

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If energy stocks are hot because demand is running high, then you need to look down the supply chain to find some of the less obvious winners like WHD.

It may be odd to have a ticker that doesn’t match up with the corporate name, but the ticker represents the business Cactus is in, wellhead and pressure control equipment for wells. It’s very important to keep the internal pressure of oil and gas wells at an ideal level so that the product and the gas that manages the pressure are optimized. If it flows too quickly, then the pressure will drop while there’s still plenty of oil in the well. If it flows too slowly, you may build too much pressure and damage equipment.

WHD specializes in this equipment. And given the mounting desire to drill more in the U.S., WHD has a long runway.

WHD stock is up 57% in the past 12 months and 31% year to date, and it currently has a market cap of $3.4 billion. It’s a bit expensive, but its earnings will continue to rise, bringing down that cost.

This stock has a triple-“A” rating in my Portfolio Grader.

“A”-Rated Stocks to Buy: CONSOL Energy (CEIX)

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King Coal has been in exile for quite a while. But the current energy crunch and rising economic growth has meant that coal is witnessing a rebound. And that’s happening both in the U.S. and abroad.

CEIX has been around since 1860, so it has seen a few things along the way. And there are still plenty of places where coal is still an important fuel. There are also power plants that converted to natural gas when it was cheap and can be reconverted to coal while it’s cheap (if this trend lasts a while).

Simply put, coal is doing well. And with a market cap of just $1.2 billion, it can be a niche player for a while. It also has marine terminals which will certainly be a strategic advantage now and in the future.

CEIX stock has soared 207% in the past 12 months, 40% year to date. But its P/E is just 33.

This stock has a triple-“A” rating in my Portfolio Grader.

On the date of publication, Louis Navellier has positions in AMPH, BSM, CMC, MATX and WHD in this article. Louis Navellier did not have (either directly or indirectly) any other positions in the securities mentioned in this article.

 The InvestorPlace Research Staff member primarily responsible for this article did not hold (either directly or indirectly) any positions in the securities mentioned in this article.

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