These Are John Buckingham’s Stock Picks For 2021

He also likes cloud companies for their connection to 5G. His recommendations include Digital Realty Trust, which owns and manages data centers, Cisco, solid-state drive maker Micron, hard-disk resign leader Seagate, and Intel. Buckingham also mentioned IBM, which has had time to catch up on cloud technology with its recent Red Hat acquisition.

Buckingham see opportunities in politics

The new administration has changed its focus on federal spending and could make other changes, like pharmaceuticals and healthcare. Buckingham expects infrastructure to become a hot topic at the national level, so he likes Caterpillar, Eaton, and Cummins.

He noted that the Democratic government would probably trim the defense budget. However, some might argue that low-interest rates could allow the defense budget to remain intact while supporting other policy goals. Due to the danger that still exists in the world, Buckingham has selected Lockheed Margin and General Dynamics for their low prices.

He also said healthcare could be seen in a more positive light than in recent years due to the roles Pfizer and Johnson & Johnson have played in bringing COVID vaccines to market. He noted that the healthcare sector had faced regulatory scrutiny for years, so even a “modest” reduction in the negativity will be supportive. Buckingham selected CVS Health for its role in distributing the vaccines.

Dividend stocks

Buckingham is also a big fan of dividend stocks, and he has several on his list of recommendations. The low-interest rate environment has been difficult for the bond market, but dividend stocks offer an alternative for fixed income. He noted that the dividend yield of his portfolios is much higher than the broad indices.

He isn’t just focused on yield as he looks for capital appreciation first. Nonetheless, he still owns a number of Dividend Aristocrats, which are companies that have boosted their dividends for at least 25 years. His recommendations include 3M for its 3.4% yield and Archer Daniels Midland for its 2.9% yield.

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