3 Top Value Stocks To Buy Right Now
Value stocks have fallen out of fashion during the coronavirus pandemic.
Year to date, the Vanguard Value ETF, whose biggest holdings are Berkshire Hathaway, Johnson & Johnson, and Procter & Gamble, is down 5% through Nov. 20 compared to a 10% gain for the broad-based S&P 500 and a 32% gain in the tech-heavy Nasdaq. The stocks that have done best this year are those best equipped for the crisis, which tend to be tech stocks, especially those on the growth side in areas like e-commerce, cloud computing, and digital payments. Meanwhile, accommodative monetary policy from the Federal Reserve has also favored growth stocks as non-dividend payers are outperforming dividend payers.
However, mean reversion is one of the most powerful forces in the stock market, and the outperformance of the growth sector won't last forever. In fact, it's likely to end when the pandemic comes to a close. That explains why value stocks surged after Pfizer and BioNTech reported that its vaccine had an efficacy rate of more than 90% in Phase 3 trials earlier this month, and that trend is likely to continue as the march toward a fully accessible vaccine proceeds.
Source Fool.com
