There are two things that appear to be close to certainty for 2022: COVID-19 will always be problematic for countries around the world, and interest rates will rise. And two actions which are sure values ââfor doing well because of this are Pfizer (NYSE: PFE) and JPMorgan Chase (NYSE: JPM).
Both of their companies have performed well this year and could potentially do even better in 2022. Here’s why.
The past year has been exceptionally strong for Pfizer. The healthcare giant has banked on strong growth thanks to its COVID-19 vaccine, which it predicts will generate a whopping $ 36 billion in revenue by 2021. That’s important when you consider that ‘In 2020, the company’s total revenue was $ 41.9 billion. And with COVID-19 sadly not going away anytime soon, there is more growth on the horizon. Next year, the company estimates sales of the vaccine will bring in $ 29 billion.
All without considering the potential of its COVID-19 pill, which 90 countries are said to be looking to buy. The pill may be a viable alternative for people who are reluctant to get vaccinated because it can reduce the risk of severe COVID by 89%.
Another solid year of COVID-related revenue is sure to make the company’s finances look great, once again. Pfizer’s sales of $ 57.7 billion in the first nine months of this year are up 91% year-over-year. And that’s even with the inflation and immunology segment of the company posting a 3% drop.
Pfizer is the safest COVID-19 investment in the market, as its core business grows and even in a post-COVID world, the company may be in a formidable position to expand its horizons. Over the past four quarters, the company’s free cash flow has totaled over $ 29 billion; this is more than double what Pfizer normally reports on an annual basis. All that extra money could help fund a new acquisition or growth opportunity.
Whether you’re looking at Pfizer short or long, the stock looks like a fantastic buy as the New Year approaches. Since the start of the year, healthcare stocks are up 38%, ahead of the S&P 500gains of 24%.
Leading bank stock JPMorgan also looks like a solid investment for the next year. The company is doing well in 2021 with inventory up more than 31%. In October, the company released its most recent results (for the period ending September 30) and noted that M&A activity was at record levels. As a result, the company’s investment banking fees totaled $ 3.3 billion and increased 50% year-over-year. However, its total net sales for the quarter were $ 29.6 billion and showed only a modest 1.3% improvement over the prior year period.
Still, the company’s financial data could look even stronger next year, as there could be not one, but two interest rate hikes during the year. An increase in interest rates is good news for the big banks because it means there are more opportunities to profit from the difference between the rate at which they lend money compared to the rate they pay. to a depositor.
As the largest bank in the United States, JPMorgan could benefit the most from a booming economy in 2022, as the hope is that COVID-19 concerns will finally be hidden in the rearview mirror. And longer term, more rate hikes are likely to come, making JPMorgan an even better buy if you look beyond next year.
This article represents the opinion of the author, who may disagree with the âofficialâ recommendation position of a premium Motley Fool consulting service. We are heterogeneous! Questioning an investment thesis – even one of our own – helps us all to think critically about investing and make decisions that help us become smarter, happier, and richer.