If any investor has stood the test of time, it is Warren Buffett. For years, the “Oracle of Omaha” has had a rock-star-like presence in the investing world. His annual Berkshire Hathaway shareholders meeting draws literally thousands of loyal fans who are investors. Known for his long buy-and-hold strategies and his massive portfolio of public and private holdings, he remains one of the preeminent investors in the world.
The May consumer price index came at 8.6% on an annual basis, the highest reading since 1981 and way above estimates. Mortgage rates are the highest since 2009, which at 5.78% for a 30-year fixed is still historically low, but that rate was 2.95% just last fall. In addition, new mortgage applications last week came in at the lowest number in 22 years. Gasoline prices are at all-time highs, and prices at the grocery store have jumped.
Worried investors should shift away from high-beta stocks and go into conservative dividend-paying companies to ride out what may be the worst year in the stock market since 2008 to 2009. We screened Warren Buffett’s Berkshire Hathaway portfolio looking for quality defensive names that make sense now and found 5 top companies that are all rated Buy by major Wall Street firms, and can likely avoid the devastating inflation effects.
It is important to remember that no single analyst report should be used as a sole basis for any buying or selling decision.
Bank of New York Mellon
Founded in 1784, this is the oldest company in the Fortune 500, and its stock is offering an incredible entry point for long-term investors. Bank of New York Mellon Corp. (NYSE: BK) provides a range of financial products and services in the United States and internationally. The company operates through the following three segments.
The Investment Service segment offers custody, trust and depositary, accounting, exchange-traded funds services, middle-office solutions, transfer agency, services for private equity and real estate funds, foreign exchange, securities lending, liquidity/lending services, brokerage and data analytics, clearing, investment, wealth and retirement solutions, technology and enterprise data management, trading, corporate trust, depositary receipts, payments, foreign exchange, liquidity management, receivables processing and payables management, trade finance and processing, collateral management and tri-party services.
The Investment and Wealth Management segment provides diversified investment management strategies and distribution of investment products, investment management, custody, wealth and estate planning, private banking, investment and information management services.
The Other segment engages in the leasing, corporate treasury, derivative and other trading, corporate and bank-owned life insurance, renewable energy investment and business exit activities. It serves central banks and sovereigns, financial institutions, asset managers, insurance companies, corporations, local authorities and high net-worth individuals and family offices.
Shareholders receive a 3.18% dividend. Barclays has a $68 price target on Bank of New York Mellon stock. The consensus target is just $53.97, but Monday’s last trade came in at $41.47.
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