- PayPal Holdings
- Industry: Credit services
- Market value: $247.0 billion
- Dividend yield: N/A
Will Danoff, the CEO of Fidelity Contrafund, celebrated his 30th anniversary in September (FCNTX). His recent success has been less than impressive. In two of the last five years, the $125 billion fund has struggled to outperform the large-company index.
- Castle Biosciences
- Industry: Diagnostics and research
- Market value: $1.2 billion
- Dividend yield: N/A
Glassman has also been researching the Wasatch Ultra Growth (WAMCX) portfolio, which has outperformed the industry with an annual average return of 26.6 percent over the last five years.
- IEC Electronics
- Industry: Electronic components
- Market value: $121.9 million
- Dividend yield: N/A
While small-company stocks have been out of demand for at least six years, there are still several gems to be discovered. Shares trade at a price-to-earnings ratio of 15, according to Abramowitz’s earnings estimate for the coming year, and profits “could leap to the positive side.”
- Hilton Worldwide Holdings
- Industry: Lodging
- Market value: $29.6 billion
- Dividend yield: N/A
Hilton Worldwide Holdings (HLT, $106.70) is a bet on a rebound after COVID.
- Alibaba Group
- Industry: Internet retail
- Market value: $713.7 billion
- Dividend yield: N/A
Glassman is intrigued by Matthews China’s (MCHFX) large new stake in global e-commerce behemoth Alibaba Group (BABA, $263.80).
- Industry: Social media
- Market value: $42.3 billion
- Dividend yield: N/A
Pinterest (PINS, $68.47) is a social media platform that enables people to post photos categorized by keywords. In general, the user interface is about discovering and delivering creativity.
- Twilio
- Industry: Internet content and information
- Market value: $50.2 billion
- Dividend yield: N/A
Twilio (TWLO, $312.54) helps companies to embed text, talk, email, audio, and video into items that increase consumer experience.
- Upland Software
- Industry: Application software
- Market value: $1.3 billion
- Dividend yield: N/A
Upland Software (UPLD, $42.83), headquartered in Austin, Texas, is Glassman’s pick for 2021. Upland Software provides automated solutions for enterprises to control their client base.
- Wayfair
- Industry: Internet retail
- Market value: $23.9 billion
- Dividend yield: N/A
In nearly every way, internet home products retailer Wayfair (W, $240.60) outperformed forecasts in the most recent period.
- Microsoft
- Industry:Infrastructure software
- Market value:$1.6 trillion
- Dividend yield:1%
Just a few stocks are ranked first in each of the three categories: timeliness, protection, and financial power, out of hundreds evaluated by the Value Line Investment Survey.
- Stryker
- Industry:Medical devices
- Market value:$88.7 billion
- Dividend yield:1%
Medical instruments from Stryker (SYK, $235.93) include implants for joint replacements and spinal procedures, as well as surgical instruments and guidance systems.
- Tennant
- Industry: Specialty industrial machinery
- Market value: $1.3 billion
- Dividend yield: 1.3%
Tennant (TNC, $70.90) makes high-quality floor scrubbers.
- United Parcel Service
- Industry: Integrated freight and logistics
- Market value: $146.2 billion
- Dividend yield: 2.4%
United Parcel Service (UPS, $169.18), the world’s biggest package delivery firm, has recently been upgraded from Neutral to Buy by UBS Securities. Despite capacity constraints in the market as a whole, the brokerage sees the opportunity for price increases in 2021. UPS’s cost-cutting efforts are also helping to raise gross margins.
- Bank of America
- Industry: Diversified banks
- Market value: $249.1 billion
- Dividend yield: 2.5%
Bank of America (BAC, $28.80) is the next business we’ll look into. BAC’s stock has been on a tear since March, but it is only trading at 2017 prices. It’s as if the previous four years’ equity bubble never happened.
- Intel
- Industry: Semiconductors
- Market value: $205.2 billion
- Dividend yield: 2.6%
Intel looks like an unusual tech bargain, however, with a forward price-earnings ratio of 11 and a 2.6% dividend yield.
- JPMorgan Chase
- Industry: Diversified banks
- Market value: $369.0 billion
- Dividend yield: 3.0%
Shares in JPMorgan Chase (JPM, $121.05), the financial services giant, have fallen 13% in 2020. The stock trades on par with the typical big bank – a bargain for “the best of the best” of banks, says John Buckingham, editor of The Prudent Speculator newsletter.
- LyondellBasell
- Industry: Specialty chemicals
- Market value: $29.6 billion
- Dividend yield: 4.7%
LyondellBasell (LYB, $88.54) had a terrible year in 2020, never making a profit from day one. It sells plastics and petrochemicals mainly, but it also operates a massive refinery that produces oil, diesel fuel, and jet fuel.
- Dow
- Industry: Chemicals
- Market value: $40.5 billion
- Dividend yield: 5.1%
Similarly, Dow (DOW, $54.66) seems to be an excellent portfolio for 2021.
- Enterprise Products Partners LP
- Industry: Oil and gas midstream
- Market value: $45.1 billion
- Dividend yield: 8.6%
In 2021, we’ll see how EPD works. As we wait, we will take advantage of the market-beating 8.6% dividend, which is paid in cold, hard dollars.
- Ares Capital Corporation
- Industry: Asset management
- Market value: $7.3 billion
- Dividend yield: 9.3%
With a market capitalization of just over $7 billion, Ares Capital Corporation (ARCC, $17.21) is the world’s biggest BDC. Ares is also one of the most conservatively distributed, with 73 percent of its portfolio spent in first and second-lien loans, guaranteeing that it is paid first.
- Oneok
- Industry: Oil and gas midstream
- Market value: $17.9 billion
- Dividend yield: 9.3%
Glassman’s final choice is Oneok (OKE, $40.22), a 114-year-old Tulsa natural gas refinery and pipeline firm that is tied for the most generous dividend payer on this list of recommended stocks to invest in 2021, with a yield of 9.3 percent.
