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Top Stocks To Invest In 2019

Money Morning Quantitative Specialist Chris Johnson has two top picks for the best healthcare stocks to buy in July.

Chris’ proprietary "Best in Breed" (BiB) system finds both aggressive companies and discovers undervalued sectors poised for massive gains.

The Gains on This One $10 Stock Alone Could Earn You Enough to Retire – Click Here Now for Details

And his BiB system has uncovered breakout potential for the healthcare industry.

That led Chris to take a deep dive into the sector, and he came away with two healthcare stocks with huge upside potential…

Top Stocks To Invest In 2019: Celgene Corporation(CELG)

I’ve owned Celgene when its stock was hot, and I’ve owned it when it was not. There hasn’t been much heat for the big biotech over the last year. However, my hunch is that will change.

Celgene stock trades at less than eight times expected earnings. The biotech stock is cheap for two primary reasons. First, Celgene depends on Revlimid for 63% of its total revenue, and generic-drug makers are challenging the patents for Revlimid. Second, the company has experienced some pipeline setbacks, which makes investors even more anxious about the potential threat to Revlimid. These factors arguably make Celgene the riskiest big biotech stock on the market.

But Celgene continues to deliver exceptionally strong earnings. I don’t see the stock going much lower as long as that doesn’t change — and I don’t think it will. Any good news should provide a nice catalyst for the biotech. What’s more, the mere anticipation of good news should boost the stock.

Investors have plenty of anticipating to do. Celgene should file yet again for approval of ozanimod in treating multiple sclerosis in early 2019. Solid phase 3 results for luspatercept in treating myelodysplastic syndromes (MDS), a group of rare blood disorders, should lead to regulatory filings in the first half of next year. Celgene also expects to submit cell therapy liso-cel (formerly known as JCAR017) for approval in 2019.

Those are just three potential blockbusters that Celgene has percolating in its pipeline, and there are more. In my view, the growth prospects for the biotech are really good. They’re so good that I don’t think Celgene will remain such a bargain for much longer.

Top Stocks To Invest In 2019: Royal Dutch Shell plc(RDS-A)

Royal Dutch Shell put up an almost unbelievable $14.2 billion in free cash flow in the last 12 months. That allows it to simultaneously reward shareholders with a 5.5% dividend yield and and position itself as a prime player in the future of energy — more specifically, in the coming transition from gas to electric transportation. 

The world’s largest oil companies are getting hip to that game by making giant, multibillion-dollar investments in electric utilities and renewable energy technologies. Holland’s prized oil producer isn’t risking getting left behind, planning to spend up to $2 billion per year on non-fossil energy sources. So far, so good. 

Royal Dutch Shell owns a 44% stake in solar project manager Silicon Ranch, it acquired U.K. electricity provider First Utility, and it owns natural gas distributor and solar technology developer MP2 Energy. That provides a solid foundation upon which to build, but it’s important for investors to note that management sets a high bar for its renewable investments.

All of its acquisitions in electricity distribution and electricity generation are expected to deliver equity rates of return of 8% to 12%, in addition to free cash generation within the next five years. In other words, Royal Dutch Shell (and a few other oil majors) isn’t just gobbling up renewable energy assets to collect shiny objects for an expensive PR game; it’s thinking strategically when deploying capital. That long-term thinking, when coupled with its impressive dividend yield, makes this oil stock a buy for investors committed to the long haul. 

Top Stocks To Invest In 2019: Eli Lilly and Company(LLY)

On Feb. 9, LLY dropped to a three-year low. Since then, it’s risen 16%. That climb moved the stock to trading higher than its 50-day and 200-day moving averages.

That sort of momentum – pushing it above its moving averages – is a sign the stock is heading even higher.

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In fact, the trend lines just formed a "golden cross," one of the most bullish technical indicators investors can use. In a golden cross, the 50-day moving average rises higher than the 200-day moving average, a classic bullish sign.

The last time that happened was in February 2017 when LLY was in the midst of a killer rally that sent the market up 35% over a five-month stretch.

It gets even better. Short interest grew 20% over the past month, which means a short squeeze could push the stock even higher if the rally continues.

Given that all the signals are indicating more upside, Chris has a price target on LLY of $90 per share. That’s slightly above the highs of October and December. That move might give a double if investors play the $85 call with an Aug. 17, 2018 expiration.

But LLY isn’t the best healthcare stock on our list…

Top Growth Stocks To Watch For 2019

You see, certain dividends are taxed at a much lower rate than other gains, thereby protecting a portion of your income. This is the case with qualified dividends – dividends earned from stocks you’ve held for at least 60 days before the ex-dividend date.

Instead of being taxed at the normal income rate, like short-term gains, qualified dividends are taxed at a significantly lower rate – up to nearly 50% less, depending on your tax bracket. With qualified dividends, you not only get reliable returns – you get to keep more while the tax man gets less.

As Keith notes, dividend stocks are the perfect insurance against market downturns. According to Keith, dividend stocks are "fantastic insurance against market corrections, and they’re indispensable when the U.S. Federal Reserve is punishing savers and income investors by keeping interest rates near zero."

The only real question about dividend stocks is knowing which ones to buy for the best gains. As Keith points out, there are over 200 great dividend stocks on the Nasdaq alone.

In order to help readers buy only the best dividend stocks, the Money Morningteam has compiled a list of most promising dividend stocks to buy. These stocks have spectacular growth potential – plus, some pay out a whopping yield of up to 15%.

With strong growth potential and dividend payouts, these stocks will be able to provide investors with reliable returns for many years to come, no matter what they do after an earnings report.

Here are our top dividend stocks to buy right now…

Top Growth Stocks To Watch For 2019: JD.com, Inc.(JD)

JD.Com Inc(ADR) (NASDAQ:JD) has a very definitive chart, with support at $36 and resistance at $49.

Resistance has done its part and now it’s almost time for support to kick in. With JD stock about a buck above this one-year level of support, I would consider this a must-hold level. If it breaks, it gives bears a great risk/reward to push it lower. Likewise, bulls have a solid risk/reward should it hold.

Top Growth Stocks To Watch For 2019: AbbVie Inc.(ABBV)

This favorite stock of Wall Street has been trading above its 50-day simple moving average (SMA) since November 2016. Even the February sell-off did not cause the price to violate support at the 50-day SMA. This tells me one thing: Big money is watching the primary technical indicator and buying every pull back!

Fundamentally, the pharmaceutical company is reliable, as evidenced by a recent 35% dividend raise, a $10 billion stock buyback program and a 2017 patent suit victory.

Top Growth Stocks To Watch For 2019: Ecopetrol S.A.(EC)

Ecopetrol is a petroleum company focused on identifying opportunities primarily in Columbia and northern Peru. EC is holding a Zacks Rank #2 (Buy), as well as an “A” grade for Value. The stock is also a nice growth pick, as Ecopetrol is projected to improve its earnings at an annualized rate of 43% over the next three to five years. Shares have risen more than 0% over the past month and could be attractive to momentum investors looking to make a play on rising oil prices.

Top Growth Stocks To Watch For 2019: Government Properties Income Trust(GOV)

While Government Properties Income Trust (NASDAQ:GOV) has not raised its dividend over the last five years, income investors can’t complain about the stock’s generous 8% average dividend yield during this time.

GOV current yields more than 12%, but unlike recent years, the stock is increasingly looking like a yield trap. In fact, Simply Safe Dividends assigns the company an extremely low Dividend Safety Score of 3.

Dividend Stocks to Avoid: Government Properties Income Trust (GOV)

GOV is a real estate investment trust which owns over 100 properties leased primarily to the U.S. government and state governments.

Unfortunately, governments are looking to become much more efficient with their spending, including reducing the amount of office space per employee.

Analysts expect GOV’s adjusted funds from operations (AFFO) per share to slip more than 15% over the next 12 months, which will push the company’s AFFO payout ratio to nearly 130%.

When combined with the firm’s substantial amount of debt, a meaningful dividend cut could be on the horizon.

Top Growth Stocks To Watch For 2019: Celgene Corporation(CELG)

Growth at bargain-basement prices is a bit of an oxymoron because value stocks usually aren’t double-digit growers. That’s not the case for Celgene, though.

A light bulb illuminated above a person's head in front of a blackboard covered by diagrams.

IMAGE SOURCE: GETTY IMAGES.

Even though Celgene reported 20% year-over-year sales growth last quarter, its shares are trading at a forward P/E ratio of only 8.1. That’s a cut-rate valuation for a company that expects to deliver sales of at least $19 billion in 2020, up from $13 billion in 2017.

The low valuation is a result of a big setback Celgene suffered on a lead drug candidate in its pipeline, ozanimod. Celgene had filed for FDA approval of ozanimod for multiple sclerosis, a mega-blockbuster indication, but the FDA rejected the application, and that pushes out the timeline for a potential green light.

Celgene says it will refile for approval early in 2019, and if so, then ozanimod could begin chipping away at sales in the indication in 2020. Until then, there’s plenty going on at the company that could spark a rally in its share price again.

For instance, the company recently acquired Juno Therapeutics to get its hands on a pipeline of chimeric antigen receptor T-cell gene therapies (CAR-Ts). CAR-Ts represent one of the biggest recent advances in treating blood cancer, and depending on trial results, the first CAR-T from this collaboration could be filed for approval next year. Similarly, Celgene is partnering with bluebird bio (NASDAQ:BLUE) on bb2121, a CAR-T for multiple myeloma. So far, bb2121 is delivering 90%-plus response rates in heavily pre-treated patients, and if that success continues, it could end up on regulators’ desk for approval next year, too.

In 2018, Celgene thinks sales will be $14.8 billion, and that adjusted EPS will be $8.45. In 2017, sales and EPS were $13 billion and $7.44, respectively, so the guidance reflects a company that’s far from struggling. Given the sell-off and the potential for sales to climb significantly through 2020, buying Celgene’s shares could be smart.