Watching the Dow Jones Industrial Average tumble by hundreds of points a day -- or by over 1,000 points as it did recently -- can make for a fearful time, and many investors may believe it is best to take their money out of stocks and wait for the storm to blow over.
But other investors may see the market today as what the military might call a "target-rich environment" with more buying opportunities available. While everyone loves to see the market go up and watch their investments steadily climb in value, it's like buying a house in a seller's market; you're paying top dollar and not getting as much value for your money.
While no one knows when the current downdraft might stop -- and there's a good chance this sell-off isn't anywhere near the bottom yet -- it's true that when markets fall, this is when opportunities arise. It's when good companies are suddenly cheap, allowing you to realize potentially excellent returns. As Warren Buffett has said, "Be fearful when others are greedy and greedy when others are fearful."
If you only have $100 to invest today, the following two companies are among the best stocks to consider now.
Another investing legend, Peter Lynch, thought boring stocks tended to make for great stocks to own. Because they were sleepy, they flew under Wall Street's radar and were able to surprise everyone with fantastic returns. That's why I like ABM Industries (ABM 2.99%), a janitorial services and facilities management company that's been steadily growing for over 100 years and will likely be around for another century or more.
Hurt by the pandemic as businesses and offices were shuttered for months on end, it's on the mend and revenue is growing once more, rising 30% in the first quarter to $1.9 billion. Operating profits, though, were down 3% from last year, but with office occupancy rates now rising, management raised full-year adjusted earnings guidance to a range of $3.50 to $3.70 per share, up from its previous call of $3.30 to $3.55 per share and better than last year's $3.58 per share.
What has been especially attractive to investors has been the company's record of paying a dividend, which has continued uninterrupted for 56 years. ABM has also increased the payout for 50 consecutive years -- even through the pandemic -- making it a Dividend King.
Apple (AAPL 0.73%) is also a dividend-paying tech stock, though admittedly with a yield of 0.6%, few if any investors really buy it for the payout. Rather, its long record of leading-edge innovation in consumer electronics that is Apple's biggest draw.
Some analysts worry the end of the smartphone upgrade supercycle will hit the iPhone maker hard, with recent data from Canalys showing smartphone shipments falling 11% worldwide. But Apple, which is the second-biggest smartphone maker with an 18% share, "continues to capture consumer demand" with the iPhone 13 while the new iPhone SE "is becoming an important mid-range volume driver for Apple," according to Canalys.
Yet as much of a key to its future as the iPhone, iPad, Mac computers, and other devices are, look for services to play an increasingly important role over the next 20 years, because they are critical to its success now.
Service revenue reached an all-time high in Apple's fiscal second quarter at $19.8 billion. Services now account for over 20% of total revenue, up from under 19% last year. As it leans more into growing that base of business -- it's reportedly restructuring it to concentrate on streaming and advertising -- the ebb and flow of upgrade cycles will have less influence on its continued success, allowing for smoother growth in the years to come.