The Bear Market Is Indeed Here: Time to Switch to Safer Assets

Constellation Brands

If there is any company with products that stay in style, it is this one, which only has 7% foreign sales. Constellation Brands Inc. (NYSE: STZ) is a leading global producer and marketer of beverage alcohol. Its wide-ranging portfolio spans wine, spirits and imported beer. The company is one the world’s largest wine companies overall and is the largest global premium wine company. Key brands include Robert Mondavi, Clos du Bois, Blackstone, Arbor Mist, Black Velvet and SVEDKA vodka. It also owns 100% of the rights to brew, market and sell Modelo’s Mexican beers in the United States.

The company posted solid quarterly results, and analysts across Wall Street raised their earnings estimates for fiscal 2019. Constellation Brands has also made a gigantic $3.8 billion investment in cannabis company Canopy Growth to increase its holdings in the company. The record investment reflects a world in which pot has become ubiquitous as its counterculture stigma fades.

Investors in Constellation Brands are paid a 1.65% dividend. The $240 Merrill Lynch price target compares with the $244.22 consensus estimate. The stock closed trading at $176.05 on Monday.

Kraft Heinz

Kraft Heinz Co. (NYSE: KHC) was formed almost three years ago via the merger of H.J. Heinz and Kraft Foods. The company is the leading global food company, with $29 billion of annual revenues generated by well-known brands such as Kraft, Heinz, Oscar Mayer and Maxwell House.

The company is the third largest food and beverage manufacturer in North America, and it derives 76% of revenues from that market and 24% from International. The company’s many brands also include ABC, Capri Sun, Classico, Jell-O, Kool-Aid, Lunchables, Ore-Ida, Philadelphia, Planters, Plasmon, Quero, Weight Watchers Smart Ones and Velveeta.

Kraft Heinz shareholders are paid a huge 5.27% dividend. Merrill Lynch has set its price objective at $83. The posted consensus target price is set much lower $60.27, and the shares closed most recently at $46.82.


This top grocer does almost all of its business in the United States. Kroger Co. (NYSE: KR) is the second largest U.S. food supermarket retailer and generates $120 billion in annual sales. Kroger operates roughly 2,800 supermarkets throughout 35 states and under two dozen banners. Kroger also sells fuel at 1,450 supermarket fuel centers and operates 2,268 pharmacies and 274 jewelry stores.

The stock remains very cheap as it has a market cap of under $24 billion. The company posted solid fiscal third-quarter results, wherein operating profits came in $100 million above Wall Street forecasts. Unexpected expense leverage on cost controls and alternative profit streams more than offset a lower gross margin due to price investments.

Kroger shareholders are paid a 1.9% dividend. Merrill Lynch recently raised its price target to $37 from $35. The consensus target is set at $31.22, and the stock closed on Monday at $28.92 per share.

These five stocks probably will hold up much better than momentum tech companies, and all do pay dependable dividends. While the sell-off that started in early October has been brutal, the reality is we could go much lower and rotating now might be a good strategy.

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