The Federal Reserve with 50 basis points up to a range of 1% to 1.25% in an emergency movement earlier this week, citing the "evolving risks" of the coronavirus for the US economy. The last time the Fed made a cut in interest rates between scheduled meetings was in October 2008 at the height of the global financial crisis.
The US central bank may also not be lowered. Futures traders bet that half a percentage point will be lowered when the Fed meets later this month.
As the Fed further reduces financing costs, these three stocks have the potential to achieve strong returns in the coming months:
1. Newmont Goldcorp
The first name to be considered comes from the gold mining sector. Expectations of monetary stimulation and lower interest rates tend to profit, which is currently trading just below the highest level in seven years.
Newmont Goldcorp (NYSE 🙂 – formed from the merger of Newmont Mining and Goldcorp in April 2019 – has outperformed its broader market in recent weeks. Shares, which have risen by around 12% this week and have risen by 48% in the last 12 months, ended on Wednesday at $ 51.00. They reached their highest level since November 2012 at $ 51.34 on March 3.
& # 39; The world's largest gold producer based on market value, production and reserves, reported revenues of $ 2.97 billion in its last quarterly results on February 20, representing 45% revenue growth.
The Greenwood Village, Colorado-based company has benefited from both a sharp rise in gold prices and higher production volumes. In the Q4 average of Newmont Goldcorp, gold prices rose by 20% over the same period a year ago to $ 1,478 per ounce, while annualized production increased by 27% to 1.83 million ounces.
Looking ahead, the company expects the attributable gold production for 2020 to be 6.4 million ounces and that the total cost of gold will be $ 975 per ounce sold. As long as the prices of the yellow metal continue to rise, robust performance seems to continue.
Newmont also announced plans to raise its annual dividend by 79% to $ 1.00 per share, another move that will benefit investors.
2. Realty Income Corporation
With the expected interest rates low, real estate investment trusts (REIT) offer the benefits of investing in real estate without the responsibility for owning and managing real estate.
Realty Income (NYSE :), based in San Diego, California, owns 5,797 properties with a total of 93.3 million rentable square feet. The company focuses on companies that are less threatened by e-commerce or recessions, such as supermarket chains such as Walgreens and 7-Eleven.
Shares traded at record levels have risen by 8% so far this week. Real estate income closed at $ 78.15 last night with a market capitalization of $ 26.7 billion. The stock reached an intraday peak of $ 84.92 on February 20.
Real estate income on both the top and bottom lines when it announced the fourth quarter earnings on February 19. a year earlier. Sales also increased by 20% over the same period last year to $ 394.2 million, above the predictions of $ 382.5 million.
Still promising, adjusted operations funds, a more accurate measure of REIT profitability than net income, climbed from 79 cents in the fourth quarter of 2018 to 86 cents per share.
The company is also one of the few REITs that pay dividends monthly instead of quarterly. Realty Income offers a monthly dividend of $ 0.2325 per share and a return of 3.74%.
