If there's one takeaway from 2020, it's that making careful investment choices is as important as ever. This month, the stock market has continued to react to sharp domestic and global spikes in new coronavirus cases and a fraught U.S. presidential election. Few stocks have proven entirely recession and crisis-proof, and many have been scraping the bottom since the market crash in March.
On the bright side, the COVID-19 recession has certainly put a spotlight on those companies that are more resistant to economic volatility, and these could be shrewd plays to help safeguard your portfolio if renewed troubles send the market diving again. If you're looking to beef up your portfolio against economic volatility, these are five hot stocks you can buy in November and hold for the long haul.
Virtual healthcare was a rapidly growing field before the pandemic -- in 2019, the American Medical Association reported that the use of telehealth services had doubled compared to 2016. As millions of people choose to stay at home to avoid risking exposure to and spread of the coronavirus, Teladoc (NYSE:TDOC) and its peers have seen demand for their services surge.
In the third quarter ended Sept. 30, Teladoc's revenue grew by 109% year over year, while the number of consultations with healthcare professionals conducted on its platform rose by 206%. Its revenue for the first nine months of 2020 rose 79% compared to the same stretch of 2019. Teladoc's third-quarter gross margin totaled 63.3%, a slight uptick from its second-quarter gross margin of 61.7% but a decline from its Q3 2019 gross margin of 68.1%.
The growth surge doesn't look to be slowing down anytime soon. The company finalized its merger with Livongo Health on Oct. 30. According to management, in "joining the market leaders in virtual care and applied health signals, the combined company becomes the only consumer and healthcare provider partner to span a person's entire health journey."
Shares of Teladoc are up over 140% year to date, and the stock barely moved during the market's March slump. This indicates that shareholders were and continue to be confident in the company's growth potential, regardless of pandemic-driven volatility in the wider market.
2. Johnson & Johnson
Johnson & Johnson (NYSE:JNJ) has earned headlines recently for its work to develop a coronavirus vaccine. The Dividend Aristocrat's Janssen Pharmaceutical subsidiary is developing the vaccine candidate, but progress hit a snag last month when researchers had to pause the phase 3 Ensemble trial after reporting "a serious medical event" in one participant.
In a follow-up statement released on Oct. 23, Johnson & Johnson said that it was gearing up to resume the late-stage safety and efficacy trial upon receiving green lights from both the Data Safety and Monitoring Board and the U.S. Food and Drug Administration (FDA). Regarding the subject's adverse event, which was not directly linked to the vaccine itself, management noted that such incidents "can occur in study participants during any clinical study, especially large studies; they can occur in both vaccine and placebo groups and require evaluation."
For Q3, Johnson & Johnson reported $21.1 billion in sales, up 1.7% from the same period in 2019. Sales in the company's consumer health and pharmaceutical segments rose by 3.1% and 4.7%, respectively, during the quarter. Those gains were attributable to key products such as Tylenol, immunosuppressant Stelara, and multiple myeloma treatment Darzalex. Even more impressive was the fact that management raised its sales guidance for the full year by $1 billion.
Johnson & Johnson has been in business since 1886, which means it has survived many crises. Even if its COVID-19 vaccine doesn't prove sufficiently effective to earn regulatory approval, the pharmaceutical stock will be a reliable stalwart to have in your portfolio for slow but dependable growth.
Look at the company's Q3 earnings report, and several figures will jump out at you. First, there's its net sales growth -- 37% on a year-over-year basis to $96.1 billion. Operating income rose by $3 billion. And management reported a 56% increase in operating cash flow during the 12-month period starting Sep. 2019 and ending at the conclusion of the third quarter. Finally, during this year's Prime Day event in mid-October, third-party sellers generated 60% more sales than in 2019, with total sales of $3.4 billion.
Other highlights from the period included the launch of its Amazon One secure payment processing system, the opening of the first Amazon Fresh grocery stores in California, and the launch of the Fire TV Stick and Fire TV Stick Lite devices.
Few companies are projecting double-digit sales growth amid the pandemic, but Amazon's diversified business model and robust retail presence make it as close to a recession-proof and coronavirus-proof operation as you'll find. Management expects between 28% and 38% year-over-year sales growth in 2020's final quarter.
4. Procter & Gamble
Procter & Gamble (NYSE:PG) has relied on the fortitude of its varied portfolio of consumer staples to maintain its recession-resistance this year. Given the fact that its brands -- among them Tide, Bounty, Puffs, Gillette, and Charmin -- are always in steady demand, it's not surprising that the nearly 200-year-old company has performed well in 2020.
During its fiscal year 2020, Procter & Gamble's sales rose 5% to $71 billion, and earnings per share gained 13%. In the first quarter of its fiscal 2021, which ended Sept. 30, net sales were up 9%. Among the key drivers of that growth, sales in its beauty division rose by 7%, sales in its baby, feminine, and family care segment were up by 4%, and sales popped by 12% in its healthcare business.
Procter & Gamble certainly isn't a get-rich-quick stock, but its steady incremental growth and premium portfolio of brands should be appealing to long-term investors. It's also one of a very few to earn the title of Dividend King, with an unbroken 60-year streak of annual dividend hikes, and its current yield of 2.3% is slightly better than average of the S&P 500's dividend payers -- 1.8%.
Shares of Pinterest (NYSE:PINS) have exploded this year as the social networking platform's popularity continues to skyrocket. The stock, trading at roughly $63 as of this writing, is up approximately 240% year to date.
Last quarter, which ended on Sep. 30, Pinterest grew its base of monthly active users by 37% year over year, while its global revenue jumped 58%. In the U.S., Q3 revenue increased by 49%; internationally, it was up 145%. "More than ever before, people are coming to Pinterest to get inspiration for their lives -- everything from planning early for a socially distant Halloween to creating great home schools for their kids," said co-founder and CEO Ben Silbermann.
Management expects the company will outperform even those strong Q3 results in Q4, projecting 60% year-over-year revenue growth for the period. Analysts have high hopes for Pinterest: They estimate that it will boost its earnings at an annualized rate of more than 152% over the next five years alone.