With inflation hitting a 39-year high of 7% last month, you may be thinking about which stocks make sense in an inflationary environment.
Credit Suisse Wednesday published a list of the S&P 500 stocks it views as benefiting most from inflation, CNBC reports.
Going alphabetically, the roster includes Charles Schwab (SCHW) - Get Charles Schwab Corporation Report, Devon Energy (DVN) - Get Devon Energy Corporation Report, Diamondback Energy (FANG) - Get Diamondback Energy, Inc. Report, Disney (DIS) - Get Walt Disney Company Report, FirstEnergy (FE) - Get FirstEnergy Corp. Report, Freeport McMoRan (FCX) - Get Freeport-McMoRan, Inc. Report, Hewlett Packard Enterprise (HPE) - Get Hewlett Packard Enterprise Co. Report, Micron Technology (MU) - Get Micron Technology, Inc. Report, Vulcan Materials (VMC) - Get Vulcan Materials Company Report and Zions Bancorp (ZION) - Get Zions Bancorporation, N.A. Report.
As for Disney, Morningstar analyst Neil Macker likes it, putting fair value at $170, compared to its close Wednesday at $150.11. And he assigns it a wide moat.
“We believe Disney is successfully transforming its business to deal with the ongoing evolution of the media industry,” he wrote last month.
“The firm’s direct-to-consumer efforts, Disney+, Hotstar, Hulu, and ESPN+ are taking over as the drivers of long-term growth as the firm transitions to a streaming future.”
“The streaming will benefit from the new content being created at Disney and Fox television and film studios as well as the deep libraries at the studios,” Macker said. “We expect that Disney+ will continue to leverage this content to create a large, valuable subscriber base.”
When it comes to Schwab, Morningstar analyst Michael Wong wrote Tuesday that he plans to increase his $70 fair value estimate for the wide-moat company amid expectations for higher interest rates.
“Interest-rate-related income is the largest contributor to Schwab’s net revenue, and the outlook is much brighter over the next several years,” he said.