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Top 5 Value Stocks To Watch Right Now

 Warren Buffett is so good at picking winning businesses that he grew Berkshire Hathaway’s book value by more than 19.1% annually between 1965 and 2017. That astounding track record easily qualifies him as the greatest investor of all time.

So which of Buffett’s stocks do we Fools think are great buys right now? We asked a team of Motley Fool investors to weigh in and they picked the following stocks:

Top 5 Value Stocks To Watch Right Now: Clarke(T)

AT&T Inc. (NYSE:T) delivered decent, if not outstanding, earnings the other day. Investors sold the stock off. AT&T stock is trading at $31.54. Along with a yield that now exceeds 6%, I think we are going to see income investors and bottom fishers step in here.

More to the point, the antitrust trial regarding AT&T’s merger with Time Warner Inc (NYSE:TWX) is over. By all accounts, including my own, AT&T probably crushed the DOJ in the trial. The judge will rule on the case by June 12, and I believe the merger will go through. With that, AT&T will transform into a completely different company and become a great member of the growth stocks community. As a result, this combined entity will be a media and advertising powerhouse.

Even if the merger is not approved, not only T but also TWX remain excellent media companies. You can buy either entity here for growth for your portfolio.

Top 5 Value Stocks To Watch Right Now: Southern Company (SO)

Southern Co (NYSE:SO) announced a 3% raise to its quarterly dividend, increasing it from 58 cents per share to 60 cents. Shareholders of record as of May 21 will receive their higher dividends from the regulated electric and gas utility on June 6  Therefore, SO shares will be ex-dividend on May 18.
SO Dividend Yield: 5.28%

Top 5 Value Stocks To Watch Right Now: Grupo Aeroportuario Del Pacifico, S.A. de C.V.(PAC)

In fact, foreshadowing again — spoiler alert — this is the one stock that has underperformed the market. It’s still up 9%, but Grupo Aeroportuario del Pacifico — or PAC is the ticker symbol — the company that is the leading operator of airports in Mexico was at $100 a share a year ago. It’s up to $109 today. So, simple math is a 9% gain.

And so, against the S&P 500 of +15%, that’s a -6%. So, this one’s in the loss column. I don’t have a lot to say about PAC other than this is a stock that we’ll continue to recommend. It’s a very hard business to compete with. They basically operate these airports with a contract with the government, and they get to run all the concessions and the mall within the airport. That’s all part of this business.

I like the stock a lot and it’s recovered pretty well since diving right after President Trump was elected and Mexico fell out of favor for a couple of months. If Mexico were a stock for the long term, I’m a buyer and one way you can participate in Mexico’s growth over the next couple of decades would be through a stock like Grupo Aeroportuario del Pacifico. Again, pronounced by somebody who took French in high school.

Top 5 Value Stocks To Watch Right Now: Concho Resources Inc.(CXO)

RBC Capital’s Scott Hanold wrote “Time to Flex Your Muscles” on our second energy stock pick. Concho Resources Inc (NYSE:CXO) is now poised to become the biggest player in the Permian Basin. Earlier in April, Concho announced a $9.5 billion deal to snap up fellow Permian fracker RSP Permian.

According to Concho, this deal “creates the largest crude oil and natural gas producer from unconventional shale in the Permian Basin.” Specifically, JPMorgan analyst Arun Jayaram is forecasting 23% annual production growth through 2021 and “significant” free cash flow generation. To top it all off: management is modelling for an impressive $2 billion in acquisition synergies. After the deal closes in Q3, these efficiencies should materialize quickly says management.

In his post-announcement report, Hanold tells clients he is impressed by the ‘complimentary’ deal. He notes that “our well data shows RSPP wells are among the most prolific, portending to improving returns.” As a result: “Core activity should generate industry-leading returns, margins, and growth. CXO has a well-established asset base and is one of the largest producers and the most active operator in the Permian Basin. We think this scale provides significant advantages over its peers.”

According to the Street there is still big upside potential of 25% from current prices. This is based on the stock’s average price target of $186. Plus, our data shows that in the last three months, 11 out of 12 analysts have rated the stock a ‘Buy’.

Top 5 Value Stocks To Watch Right Now: Texas Instruments Incorporated(TXN)

Although you might recognize the brand because of its calculators, Texas Instruments is actually one of the leading suppliers of advanced semiconductors in the world. It functions as one of the top players in the analog IC and embedded processor fields. The company has also developed into a major IoT pick, reporting year-over-year sales growth of 20% in the unit that handles this business during its most recent quarter.

Meanwhile, the semiconductor firm surpassed revenue estimates and released in-line guidance. This has led to more bullish analyst sentiment and propelled the stock to a Zacks Rank #1 (Strong Buy). The stock also has a Forward P/E of 20.5 and a PEG of 2.1, so investors are getting a decent price for its earnings and earnings growth outlook.

It is also worth noting that TXN offers investors a dividend yield of about 2.3% right now.

Top Canadian Stocks To Buy Right Now

Technology stocks are staples in growth portfolios because of their eye-popping revenue growth, but technology isn’t the only sector of the stock market that boasts fast-growing companies. For example, many healthcare stocks are growing at rates that Silicon Valley would envy. In fact, these stocks all reported year-over-year sales growth north of 100% in the first quarter of 2018.

Are these stocks worth including in your portfolio?

Top Canadian Stocks To Buy Right Now: AbbVie Inc.(ABBV)

Our first pick is AbbVie Inc (NYSE:ABBV). This North Chicago, IL-based company has an Earnings ESP of +0.24% and a Zacks Rank #3.

The stock has seen the Zacks Consensus Estimate for first-quarter 2018 earnings being pegged at $1.78 per share. Besides this, the company boasts an encouraging earnings track record, exceeding expectations in all the last four quarters with an average beat of 1.81%.

Top Canadian Stocks To Buy Right Now: Amazon.com, Inc.(AMZN)

Hey, I’m as big a fan of Jeff Bezos and Amazon.com Inc. (NASDAQ:AMZN) as anyone, but how on earth did the world’s biggest e-commerce company beat analyst estimates by 157%?

I’ll admit I love using analysts for sound bites in my coverage of public companies but there’s something definitely wrong when a business on as big a roll as AMZN gets a Q1 2018 estimate of $1.27, 21 cents lower (!?!) than the year before.

Are these men and women not reading Amazon’s financial reports?

If you are an Amazon shareholder, the one thought you should have after examining its first-quarter results is: Please keep losing money internationally — the unit had a $622 million operating loss in the quarter, 29% higher than a year earlier — because we know what happened with its North American e-commerce business after losing lots of money; it’s now making lots of money.

Throw in its AWS business which grew operating margins by 140 basis points year-over-year while pulling down $1.4 billion in operating profits and I’m not sure there’s an argument against owning its stock for the next 10-30 years.

Top Canadian Stocks To Buy Right Now: Facebook, Inc.(FB)

Following iRobot, Facebook reports its first-quarter results on Wednesday. As usual, the bar is high for Facebook. In Facebook’s fourth quarter, revenue climbed 47% and adjusted earnings per share surged 83%. In addition, Facebook’s user base grew to 2.1 billion people using it every month and 1.4 billion people using it daily. The results capped off a year of excellent financial performance.

But Facebook also admitted during the last earnings call that 2017 "was also a hard year" in some ways. "We’ve seen abuse on our platform, including interference from nation states, the spread of news that is false, sensational and polarizing, and debate about the utility of social media," said Facebook CEO Mark Zuckerberg in the company’s fourth-quarter earnings call. Problems were exacerbated in March when Facebook announced that a third-party developer had mishandled user data.

In 2018, Facebook will most likely try to renew user and advertiser confidence. Beyond looking for more strong revenue growth, look for Facebook to comment on how recent developments will impact its guidance for spending on security and safety.

Top Canadian Stocks To Buy Right Now: Clarke(T)

With its big yield, history of delivering regular dividend growth, and a non-prohibitive valuation, AT&T is a stock that’s worth building a super-long-term position in. The telecom giant’s yield comes in at 5.7%, and a 34 year history of delivering annual payout growth and massive cash flow suggest there’s a good chance the company will continue to raise its payout. 

The company’s stock performance has been tepid in recent years due to pressures in both the wireless and television spaces. Competition from budget priced rivals like T-Mobile has put pressure on mobile service sales and the rise of cord-cutting and skinny bundles is impacting the performance of its DirecTV subsidiary. AT&T has been leveraging its advantage when it comes to bundling mobile, internet, and television services to create meager sales growth, but it’s also taking hits when it comes to its margin.

The good news is that the company may be able to reclaim pricing strength and create new revenue streams with the introduction of 5G networks. 5G is the next generation of wireless internet technology, and it’s on track to deliver dramatic speed increases that will pave the way for better consumer-level service and a range of new technologies including connected cars, augmented-reality hardware, and smart-city devices.

Another positive catalyst on the horizon is its pending acquisition of Time Warner — so long as it survives an antitrust suit from the Department of Justice. If AT&T is allowed to integrate the entertainment company, it’ll diversify into a new space and open up new bundling and advertising opportunities that could do a lot to brighten its long-term earnings trajectory.

Shares trade at just 10 times forward earnings estimates and nine times this year’s projected free cash flow. With its top-notch dividend profile and the company making some smart moves to fortify its business, AT&T looks like a smart long-term play.

Top Canadian Stocks To Buy Right Now: Lam Research Corporation(LRCX)

Lam Research is a designer and manufacturer of semiconductor processing equipment used in the fabrication of integrated circuits. The company is recognized as a leading supplier of front-end wafer processing equipment to the worldwide semiconductor industry. Despite this existing leadership position, LRCX is slated to witness massive earnings and revenue growth soon.

Based on current consensus estimates, we expect Lam Research to post EPS growth of 75.8% and net sales growth of 38.0% this fiscal year. Meanwhile, the firm is generating cash flow growth of 45.8% and RoE of 41.1%. LRCX is also sporting a Zacks Rank #1 (Strong Buy) right now.

Top Growth Stocks To Buy For 2019

The recipe for successful long-term investing is simple in theory but difficult in practice: Buy shares of high-quality companies; pay reasonable prices for those shares; and hold on to them for many years, unless there are legitimate reasons to sell. Failing at any one of those steps will cause trouble.

Any stock could double over the next decade, but only some have an above-average shot at doing so. These Motley Fool investors think following are these such stocks. Here’s what you need to know.

Top Growth Stocks To Buy For 2019: Clarke(T)

Telecom giant AT&T reported first-quarter earnings on April 26, and the market was none too pleased with the results. Sales for the period dipped 3.6% year over year to come in at $38.04 billion, missing the average analyst estimate of $39.37 billion. Earnings per share of $0.85 also fell short of the estimate target of $0.87, and the top- and bottom-line misses prompted the company’s biggest intraday share price decline in nearly a decade. By market close, the stock had dipped roughly 7%.

AT&T also reported that it lost 187,000 pay-television subscribers despite growth for its DirecTV Now skinny-bundle service. The company faces pressure amid changes in the television and mobile industries, but opportunities like the expansion of 5G networks and the pending merger with Time Warner give it avenues via which to growth that I expect will come to fruition. I purchased AT&T shares following the post-earnings sell-off and plan to hold the stock for the long term.

The company now trades at just 10 times this year’s expected earnings and packs a roughly 6% dividend yield. Shareholders can look for AT&T’s payout to continue growing. The telecom leader has a 33-year history of delivering annual dividend raises, and the business’s strong cash flow puts it in good position to deliver slow, but steady payout growth down the line. Even though the company distributed roughly $13 billion in dividend payouts over the last year, its $18 billion in free cash flow over that stretch had it in a good position to keep that streak alive.  

With a great yield backed by a solid business and enticing earnings multiples, AT&T is an underappreciated dividend stock that deserves your attention.

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

Worry that its best-selling drug would soon face competition because of expiring patents may have caused you to remove AbbVie from your radar. However, the likelihood of competition to Humira has fallen considerably, and that suggests income investors ought to be looking at it again.

Humira is a widely used autoimmune disease drug. In 2017, its sales of more than $18 billion accounted for about 65% of AbbVie’s revenue. Patents protecting Humira have already begun to expire, but a favorable patent decision last fall prompted competitor Amgen (NASDAQ:AMGN) to ink a nonexclusive deal with AbbVie that should keep Humira copycats at bay in the U.S. until 2023.

The extra time is great news because AbbVie has a lot of late-stage drugs that could reach the market before Humira’s sales begin to drop. Over the next year, it plans FDA filings for Rova-T, a solid-tumor cancer drug; upadacitinib, a rheumatoid arthritis drug; and risankizumab, a psoriasis drug. All three of those drugs target multibillion-dollar indications and thus could be blockbusters.

AbbVie has FDA approvals pending for an endometriosis drug, Elagolix, and a chronic lymphocytic leukemia drug, Venclexta, that have billion-dollar potential, too.

The company has increased its dividend by 77% since it was spun out of Abbott Labs (NYSE:ABT) in 2013. Since management expects its effective tax rate to fall to 9% in 2018, from over 30% last year, and thinks new drugs could increase non-Humira sales from $9 billion to as much as $35 billion in 2025, there’s reason to think even more dividend increases are coming.

Top Growth Stocks To Buy For 2019: II-VI Incorporated(IIVI)

 II-VI, Inc. (NASDAQ:IIVI) provides engineered materials and optoelectronic components worldwide.

The company’s total revenue reached $972 million as of fiscal year ending June 2017. This is 88.2% higher than the $516 million achieved in fiscal year June 2012. II-VI’s top-line growth has ranged from 6.7% to 24.0% over the last five fiscal years.

Going forward, Wall Street forecasts that II-VI’s total revenue will reach $1,839 million by fiscal year 2022 representing a five-year CAGR of 13.6%.

Shares of the company are up 23.0% over the last year. The stock last traded at $47.25 as of March 20th and 8 separate valuation analyses imply that the stock is trading near its fair value.

Top High Tech Stocks To Invest In 2019

Most businesses posting rapid expansion right now will not be able to maintain that level of growth over time. On the other hand, there will be standouts — the rare companies with the right makeup and competitive advantages to capitalize on market trends and repeatedly take their businesses to the next level.

Having even a few of these companies working in your favor over the long term can be a life-changing event. To help put readers on to some high-growth stocks that still have big potential, we asked three Motley Fool investors to profile a top growth investment. Read on to see why they identified the following stocks as top stocks for growth-seeking investors.

Top High Tech Stocks To Invest In 2019: Clarke(T)

 There’s no denying AT&T Inc. (NYSE:T) has had its struggles. Wireless telecom as well as broadband have become commodities, and cable television is no longer just available through a literal cable.

Its recent effort to acquire Time Warner Inc (NYSE:TWX) has also run into some political pitfalls. When it’s all said and done though, T stock is entrenched in the markets it needs to be entrenched in, and it’s got the size and cash-stash to but what it needs to buy to remain competitive. It’s not going anywhere.

That said, whether its revenue growth is impressive or not, nobody can deny that AT&T is one heck of a reliable dividend payer. It has been paid out every quarter like clockwork since the mid-80’s, and grown the whole time. Newcomers are going to enjoy a 5.6% yield on their investment.

Top High Tech Stocks To Invest In 2019: Axon Enterprise, Inc.(AAXN)

Now, Axon Enterprise had  just changed its corporate name to that name the very month that we did this podcast a year ago. It used to be known as TASER. But Axon Enterprise — the same company that sells Tasers and has innovated with the Taser — changed its name to its other key product, which is its police body cams. And that’s such an important trend.

I was talking about that a year ago — how Axon Enterprise’s main profit source [still is today] was the Taser, but as it builds out police body cams [not just here in the U.S., but globally], it’s a lower margin. They don’t make as much money off its product and they’re sort of in development stage, still. They started losing money with that a year ago, and so it was depressing the corporate results.

But, if you really thought about where the world is headed and how this company was leading us there, you recognized beyond the body cams themselves [the Axon body cams]; the company has Evidence.com, which is the website where up in the cloud all of these videos from all these police departments are stored, and that is a subscription service that police departments buy. So, Evidence.com, Axon, and Taser the stock was at $23 when we did this podcast and I picked it a year ago. It’s now up to $43.00. So, it’s been a tremendous year for Axon, ticker symbol AAXN, up 87%.

Now, I should mention that the S&P 500 over the last year is up 14.5%. We’ll round that up to 15% just to give Mr. Market his due, so we’re competing against a +15% with each of these picks. I’m going to foreshadow and let you know, dear listener, that this was the best of the five stocks. Nothing did better than +87%. A tremendous year for Axon and I’m really excited that it’s in the Rule Breakers portfolio. I hope it’s in your portfolio, too. In fact, the name of this sampler, when I pick stocks a little later, is going to be something like Five Stocks That I Own And You Should, Too.

Now, I wish I did own Axon. I don’t own all of my 220 picks, but I sure hope you listened a year ago. I know many of you do own Axon through Rule Breakers and wow, what a great year it’s been, and I really like this stock going forward. When I picked these stocks for April The Giraffe, unbeknownst to me at the time a year ago, I did say these are for the next three-plus years, so we’ll be reviewing this list of stocks each of the next three years. Year one awesome, Axon!

Top High Tech Stocks To Invest In 2019: iRobot Corporation(IRBT)

Of these two companies, iRobot is scheduled to report its earnings first. The maker of the popular Roomba vacuum is scheduled to report its first-quarter results on Tuesday. 

In the fourth quarter, iRobot posted record fourth-quarter revenue of $327 million, up an impressive 54% compared to the year-ago period. The growth marked an acceleration compared to full-year revenue growth of 34%. Operating income also increased, rising from $18.7 million in the fourth quarter of 2016 to $23.1 million in Q4 2017.

But there’s more strong growth in front of the company, according to management. iRobot is optimistic about the "tremendous" opportunity ahead. "Global household penetration of robotic vacuum cleaners remains extremely low, in the single digits," said iRobot CEO Colin Angle in the company’s fourth-quarter earnings release. "Strong economic conditions worldwide are fueling overall global growth and positive consumer sentiment."

With management guiding for 2018 revenue to rise about 20% compared to 2017, based on the midpoint of the forecast range, investors should look for first-quarter revenue growth to handily exceed this growth rate. A first-quarter revenue growth rate beyond management’s expected full-year pace would leave more room for revenue growth to decelerate as the year goes on.