Last week’s market rally and Monday’s follow-up provided the best results beleaguered stock investors have seen since late last year. The venerable S&P 500 ended its fourth straight positive week as stocks extended their longest winning streak since last November. The excitement for the at-risk crowd was the falling numbers reported for the consumer and producer price indices.
However, lower energy prices were the main reason for the backup, and most Wall Streeters believe that not only can energy prices stay high and perhaps go much higher, but that food and other cost-of-living components like rent could continue to remain at generational highs throughout the year and into 2023.
What are investors doing to combat the debilitating effects of inflation and rising interest rates? Buy stocks that have durable assets and real estate investment trusts (REITs) that also offer double-digit returns. We’ve found seven big companies that are Buy rated on Wall Street and have very strong ideas in these volatile times.
It is important to remember that no single analyst report should be used as the sole basis for any buy or sell decision.
This off-the-radar idea offers exceptional total return potential. AFC Gamma Inc. (NASDAQ: AFCG) originates, structures, guarantees and invests in senior secured loans and other types of loans and debt securities for established companies operating in the cannabis industry in states that have legalized medical or adult cannabis.
The Company primarily issues loans structured as senior loans secured by real estate, equipment and licenses or other assets of the lending parties to the extent permitted by applicable laws and regulations governing such lending parties. AFC Gamma has elected and qualified to be taxed as a REIT for US federal income tax purposes under the Internal Revenue Code of 1986.
The company posted exceptional results in the second quarter that exceeded expectations for profits and revenues. AFC Gamma has beaten consensus revenue estimates three times in the past four quarters.
Investors receive a distribution of 12.38%. JMP Securities has a price target of $25 on the stock, while the consensus target is $23.15. Shares closed Monday at $18.61, up more than 2% on the day.
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This company has paid strong dividends for years. AGNC Investment Corp. (NASDAQ: AGNC) operates as a REIT in the United States. It invests in pass-through residential mortgage-backed securities and secured mortgage bonds for which principal and interest payments are guaranteed by US government-sponsored companies or agencies.
The Company finances its investments primarily through secured borrowings structured as repurchase agreements. The company elected to be taxed as a REIT under the Internal Revenue Code of 1986 and would not be subject to federal corporate income tax if it distributed at least 90% of its taxable income to its shareholders.
AGNC Investment equity investors receive a distribution of 11.36%. Keefe Bruyette’s price target of $13.25 compares to the consensus target of $12.40 and Monday’s closing price of $12.79.