Investing

5 All-American 4th of July Stocks to Buy for Year-Round Gains

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If there is any holiday that we celebrate in the United States that is among the favorite among all citizens, it has to be the 4th of July. It transcends all walks of life, and the secular nature of the celebration makes it one for all residents to participate in honor of probably the most important in the nation’s history. From the largest cities to the smallest rural communities, the pride and participation of small kids to senior citizens marks this as truly a special day.

At 24/7 Wall St., we thought it was a good time to look at top companies that are usually big winners during the holiday and may be even bigger this year as the celebration falls on a Tuesday, so many will be taking Monday off for an extended long weekend. With parades, barbecues, boating, bands and much more, many Americans will be going to the store to get provisions for the big day or heading out for fun vacations.

We screened the Merrill Lynch research database and found five top companies that may have a huge start to the second-quarter because of the holiday, and all are rated Buy.

Coca-Cola

This company remains a top Warren Buffet holding and offers not only safety, but an incredibly strong worldwide brand. Coca-Cola Co. (NYSE: KO) is the world’s largest beverage company, refreshing consumers with more than 500 sparkling and still brands. With coolers getting packed for picnics, parades and vacations, you can bet that they will be stuffed with products from this iconic American company.

Led by Coca-Cola, its portfolio features 20 billion-dollar brands, including Diet Coke, Fanta, Sprite, Coca-Cola Zero, vitaminwater, Powerade and Minute Maid. Globally, it is the top provider of sparkling beverages, ready-to-drink coffees and juices and juice drinks. Through the world’s largest beverage distribution system, consumers in more than 200 countries enjoy its beverages at a rate of more than 1.9 billion servings a day.

It is also important to remember that the company also owns 16.7% of Monster Beverage, which continues to deliver big numbers.

Coca-Cola investors receive a 3.3% dividend. The Merrill Lynch price target for the stock is $48, while the Wall Street consensus target is $45.64. The stock closed Friday at $44.85.

Disney

This is a top consumer media company with multiple streams of income to push revenue, and it is a member of the Merrill Lynch US 1 list. Walt Disney Co. (NYSE: DIS) stock continues outperforming on a near-term and long-term basis. With the movie studio business poised to improve, as with accelerating theme park business, the network programming continues to drive viewership with extensive sports programming. Combining that revenue growth with the company’s solid media networks and interactive presence, and the 2017 and 2018 revenue estimates could be conservative.

The Disney Media Networks segment operates broadcast and cable television networks, domestic television stations and radio networks and stations, and it is involved in the television production and television distribution operations. Its cable networks include ESPN, Disney Channels and ABC Family, as well as UTV/Bindass and Hungama. This segment also owns eight domestic television stations. Disney is also one of 24/7 Wall St.’s top 10 stocks to own for the next decade.

Families will be flocking this summer to the company’s theme parks, such as Disneyland, Walt Disney World in Orlando, Magic Kingdom Park, Epcot and also the international parks. The long Independence Day weekend could jump start attendance.

Disney shareholders receive a 1.47% dividend. Merrill Lynch has a $134 price target, and the consensus price objective is $118.07. The shares closed Friday at $106.25.

Exxon Mobil

The world’s largest international integrated oil and gas company remains a top Wall Street energy pick. Exxon Mobil Corp. (NYSE: XOM) explores for and produces crude oil and natural gas in the United States, Canada, South America, Europe, Africa, Asia, Australia and Oceania. It also manufactures and markets commodity petrochemicals, including olefins, aromatics, polyethylene and polypropylene plastics, and specialty products, and it transports and sells crude oil, natural gas, and petroleum products.

The company posted solid first-quarter results, and Merrill Lynch recently raised the stock back to a Buy rating, as the analyst feels it is an outstanding place for investors to put money, and Exxon is the firm’s top major idea now. The analysts also cite the ability of the company to maintain and cover the cash dividend with lower oil prices as a key positive.

With gasoline prices the lowest they have been in some time, motorists are expected to hit the nation’s highways in record numbers this year for the long holiday weekend. The stock is an excellent buy for investors looking to add energy to their portfolio but leery of the recent weakness in the sector.

Shareholders receive a 3.75% dividend. The $100 Merrill Lynch price target is well above the consensus target of $87.04. The shares closed Friday at $80.73.

Kraft Heinz

This is a consumer staple stock that makes sense for nervous investors. Kraft Heinz Co. (NYSE: KHC) is the third-largest food and beverage company in North America and the fifth largest in the world, with eight $1 billion brands. A globally trusted producer of delicious foods, Kraft Heinz provides high quality, great taste and nutrition for all eating occasions, whether at home in restaurants or on the go.

The company’s iconic brands include Kraft, Heinz, ABC, Capri Sun, Classico, Jell-O, Kool-Aid, Lunchables, Maxwell House, Ore-Ida, Oscar Mayer, Philadelphia, Planters, Plasmon, Quero, Weight Watchers Smart Ones and Velveeta.

Consumer staples are expected to continue to do well this year, and this is one of the top companies in the sector. The company reported very solid earnings, and analysts across Wall Street are generally bullish on the potential for solid earnings continuing through 2017 and beyond. You can also bet that consumers will flock to the stores to buy the company’s products for holiday and summer picnics and outings.

Shareholders receive a 2.8% dividend. Merrill Lynch has set its price target at $100. The consensus target is $90.29, and shares closed Friday at $85.62.

Molson Coors

While the iconic American beer company did merge with a Canadian beer giant, it is still based in Denver. Molson Coors Brewing Co. (NYSE: TAP) is one of the world’s largest brewers (more than 3% global share) with core brands Coors Light, Carling, Molson Canadian and Staropramen. Molson and Coors merged in February 2005, added StarBev in 2012 and serves markets including the United States, Canada, Eastern Europe and the United Kingdom and Ireland, with exposure to other markets through its Molson Coors International division. It acquired the remainder (58%) of the U.S. joint venture (MillerCoors) in mid-October 2016.

What picnic or 4th of July gathering would be complete without a cold beer, and you can bet that sales will ramp up for the long weekend. The brand remains a huge favorite with Generation X and baby boomers, who were around when the light beer revolution started.

Shareholders receive a 1.9% dividend. The Merrill Lynch price target is $110. The posted consensus target is $103. Shares closed trading on Friday at $86.34.

These five all-American companies should have great 4th of July sales and are poised to continue to be solid investments in the second half of 2017. With second-quarter earnings right around the corner, it may be smart to buy partial positions now and see how the results are.

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