The market rally last week and Monday’s follow-through have provided the best results that beleaguered stock investors have seen since late last year. The venerable S&P 500 finished its fourth consecutive positive week, as stocks extended their longest winning streak since last November. The excitement for the risk-off crowd was the lower reported numbers for the consumer and producer price indexes.
However, lower energy prices were the biggest reason for the backup, and most on Wall Street feel that not only can energy prices stay elevated and perhaps go much higher, but food and other cost-of-living items like rent could continue to remain at generational highs through the rest of the year and into 2023.
What do investors do to fight the debilitating effects from inflation and rising interest rates? Buy stocks that have hard-asset plays and real estate investment trusts (REITs) that also pay double-digit yields. We found seven top companies that are Buy rated across Wall Street and are very solid ideas during these volatile times.
It is important to remember that no single analyst report should be used as a sole basis for any buying or selling decision.
AFC Gamma
This off-the-radar idea offers outstanding total return potential. AFC Gamma Inc. (NASDAQ: AFCG) originates, structures, underwrites 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 medicinal or adult-use cannabis.
The company primarily originates loans structured as senior loans secured by real estate, equipment and licenses or other assets of the loan parties to the extent permitted by applicable laws and the regulations governing such loan parties. AFC Gamma has elected and qualified to be taxed as a REIT for the U.S. federal income tax purposes under the Internal Revenue Code of 1986.
The company posted stellar second-quarter results that topped earnings and revenue expectations. AFC Gamma has beaten consensus revenue estimates three times over the past four quarters.
Investors receive a 12.38% distribution. JMP Securities has a $25 price target on the stock, while the consensus target is $23.15. The shares closed Monday at $18.61, up over 2% on the day.
AGNC Investment
This company has paid solid dividends for years. AGNC Investment Corp. (NASDAQ: AGNC) operates as a REIT in the United States. It invests in residential mortgage pass-through securities and collateralized mortgage obligations for which the principal and interest payments are guaranteed by U.S. government-sponsored enterprises or agencies.
The company funds its investments primarily through collateralized borrowings structured as repurchase agreements. The company has elected to be taxed as a REIT under the Internal Revenue Code of 1986 and would not be subject to federal corporate income taxes if it distributes at least 90% of its taxable income to its stockholders.
AGNC Investment stock investors receive an 11.36% distribution. Keefe Bruyette’s $13.25 price target compares with the $12.40 consensus target and Monday’s closing price of $12.79.
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