- There are plenty of high-quality stocks on sale in today’s market.
- Those with low debt and hefty cash reserves make for the best bets.
- FB, GOOGL, and HUM look like some of the best bets for a coronavirus recovery.
Google analytics show that people are searching for the term “stocks to buy” more than ever before – a sign that investors are preparing to buy the dip. It also suggests that, despite the fear and anxiety that prompted this selloff, many investors are overwhelmingly bullish.
But when the Dow is at multi-year lows and politicians are talking about shutting down economic activity for a period of months, what kind of companies are worth investing in?
The answer to that depends heavily on risk tolerance, but there are a few hallmarks of a company that can withstand just about anything: low debt, strong cash flows and a lot of cash.
Companies with some combination of those factors make worthwhile investments in times of trouble. Here’s a look at three stocks that meet these criteria.
When it comes to choosing top-quality stocks many people think of Apple (NASDAQ:AAPL) because of its infamous cash pile worth $207 billion. But while Alphabet’s cash hoard comes in lower at $120 billion, its lower debt obligations make it a potentially better investment.
GOOGL stock owes just $4.5 billion in long-term debt. That gives the firm a debt-to-equity ratio of just 2.26%— far below Apple’s 104%.
RBC Capital analyst Mark Mahaney pointed to Google as one of the best buys for investors concerned about liquidity.
Google’s strong cash flow coupled with hefty savings and low debt will help the company thrive in an economic downturn. Not only does it cushion Alphabet as companies cut down on advertising spend, but it allows the firm to…