7 stocks to buy if you’re concerned about political uncertainty


As we await Georgia’s runoff election, Americans now have a clear idea of ​​the balance of power in Washington, DC, for the next two years. Republicans will have a narrow majority in the House of Representatives. This will have the practical effect of smoothing out the already slow cogs of government. For those looking for stocks to buy, this can definitely make things a bit more difficult.

It is important to know what this means for an individual investor’s strategy, including which stocks to buy and which to sell. My short answer may not be very satisfying. In 2023, I think investors will need to continue to execute many of the same strategies that worked this year. Inflation may have peaked, but has yet to come down. This means that interest rates should continue to rise.

As a result, all of us so-called retail investors are caught in the middle of this uncertainty hoping for better days. However, as the saying goes, hope is not a strategy. So, I’m going to offer another thought. Buy stocks that have a story. In this case, stocks that are part of sectors that are likely to rise due to trends in the broader economy.

In this article, I suggest seven such stocks for purchase. These are companies with compelling stories that don’t depend on government stimulus to thrive.

XOM Exxon Mobil $112.08
CRWD CrowdStrike $138.99
CHPT ChargePoint holdings $12.45
KFY Korn ferry $56.42
MGM MGM International $36.74
EXPE Expedia Group $98.31
Message of public interest public storage $293.51

Exxon Mobil (XOM)

Source: Michael Gordon/Shutterstock.com

Topping this list of stocks to buy is Exxon Mobil (NYSE:XOM), but maybe not for the reason you might think. Yes, oil is expected to rise in 2023. And that will mean another quarter or two of good earnings. This could continue to inflame rhetoric about obscene profiteering in the political class. But this rhetoric is shortsighted, and if you allow me a minute, I’ll explain why.

As our nation moves toward a renewable energy future, there is an irony that cannot be overstated. It’s that traditional fossil fuel companies like Exxon Mobil, BP (NYSE:BP) and Chevron (NYSE:CLC), to name a few, are well positioned to help develop renewable energy solutions. These companies saw the writing on the wall decades ago and were never going to be without a seat at the table.

Exxon Mobil uses part of its fortress balance sheet to invest in clean energy initiatives. I bet you won’t hear about it in Washington. I will not deny that in the short term, XOM stock should benefit investors with capital appreciation based on the laws of supply and demand that govern the oil market. But as a long-term holding company, investors should not ignore the company’s investments in renewable energy.

CrowdStrike (CRWD)

A sign with the Crowdstrike (CRWD) company logo

Source: VDB Photos / Shutterstock.com

In 2023, businesses will continue to cut spending wherever they can. However, one area likely to avoid the chopping block is cybersecurity. In recent years, cybersecurity has become a top priority for every business. And it is a well-known fact that the the political class is well aware threats that the costs of cyberattacks represent for companies.

So, because the nature of online threats is ever-changing, cybersecurity is expected to remain one of the top sectors for investors in 2023. CrowdStrike (NASDAQ:CRWD) offers cloud-native solutions that allow enterprises to displace their existing security protocols. This makes the company an ideal choice to transition to hybrid working.

I will not claim that this CRWD stock has an ideal valuation. For example, market analysts predict the company’s valuation at 80 times forward earnings. But consensus analyst opinion gives the stock a price target of around $240, which would offer more than 70% upside at the time of this writing.

ChargePoint Holdings (CHPT)

Electric vehicle inventory: A close up of a ChargePoint charging station.

Source: YuniqueB / Shutterstock.com

The transition to electric vehicles continues to gain momentum. Many car manufacturers who are not named You’re here (NASDAQ:TSLA) have launched electric vehicles, and more are on the way. But there needs to be a massive infrastructure built to reduce range anxiety. Charging point (NYSE:CHPT) is at the forefront of this transition, which is why it’s one of the stocks to buy for 2023.

The bearish argument against this company is that the need for publicly accessible charging stations is overkill, as many current EV owners charge at home. But the bullish side of this chicken-and-egg argument could be that the reason they charge at home is because there aren’t enough publicly accessible charging stations to serve them.

Time will tell, and I will not insult you by saying that CHPT stock is a low risk investment. The electric vehicle industry is still in its infancy, and a range of outcomes are still possible for a company that hasn’t turned a penny of profit. That said, ChargePoint is advantageous of the Biden administration’s Cut Inflation Act. Members of the Republican House may try to block future spending, but they are unlikely to try to rein in money that has already been approved.

Korn Ferry (KFY)

Next on this list of stocks to buy is a company that is literally trying to dispel uncertainty. Korn ferry (NYSE:KFY) is a “global organization consulting firm” that is expected to be in high demand in 2023.

One of the confusing stories of 2022 has been the resilience of the job market. But, at least in the tech sector, that is changing fast. Most of the biggest names in the industry have announced hiring freezes and/or layoffs.

That said, these companies will eventually begin to take a critical look at their organizations and develop plans to ensure they have the right talent for the right jobs. And if they turn to Korn Ferry, they can benefit from the advantages of the company intelligence cloud which uses insights based on AI data to help its clients understand its current workforce and assess its hiring needs.

That thesis would appeal to investors, who saw the stock fall 26% in 2022 despite generating year-over-year increases in revenue and earnings. And if that’s correct, KFY stock could return to the all-time high it hit at the end of 2021.

MGM International (MGM)

A photo of the MGM logo on the MGM casino building.

Source: Michael Neil Thomas / Shutterstock.com

MGM International (NYSE:MGM) picked a bad time to launch its Bet MGM Sportbook and mobile app. BetMGM was supposed to launch just as March Madness was ready to launch in 2020. We all know what happened next. However, live sports are back without pandemic restrictions.

This allows the sports betting industry to resume its strong growth trend. And there is more growth expected in 2023. Currently, 30 states have legalized sports betting, and more are on the way. But the industry will remain crippled until all 50 states legalize sports betting. It will take time because it is a highly regulated industry.

Despite regulatory hurdles, MGM has plenty of competition in this space. But in a volatile market, it can be beneficial for the company. MGM has an existing portfolio of casinos that helps generate revenue while continuing to grow its sports betting business.

Expedia Group (EXPE)

Expedia app logo on a smartphone screen

Source: NYC Russ/Shutterstock.com

Expedia Group (NASDAQ:EXPE) is a mirror in the psyche of investors. In 2021, EXPE stock soared as hope for vaccines fueled pent-up travel demand. However, the situation has been different in 2022, as investor concerns about inflation and a possible recession weigh on the stock, which has almost halved.

This is despite the fact that the online booking company continues to increase its revenue and profits year on year. This reflects the fact that travel demand remains strong. That said, it has to subside, doesn’t it? Maybe?

Again, maybe not. As remote and/or hybrid work becomes both normalized and preferred, it blurs the lines between leisure travel and business travel. Many people find that with the right setting they can achieve both. Or at least give it a try.

So instead of buying shares of airlines, hotels or cruise lines, you can invest in Expedia Group which helps consumers manage their entire trip.

Public storage (PSA)

a public storage sign in front of a storage building facility

Source: Ken Wolter/Shutterstock.com

Last on this list of stocks to buy is public storage (NYSE:Message of public interest). This company is a REIT (REITs) which focuses on the self-storage industry. I encourage you to read this article by Ian Bezek which outlines the company’s unique position to take advantage of rising interest rates.

I will be more simplistic, but it will be in keeping with the purpose of this article. The pandemic has sparked a desire in people to live where they want. And while some people move to an area where the cost of living is cheaper, others move to areas where they need their salary to stretch further.

This can mean smaller living spaces, which means they’ll need somewhere to store their things. And that means demand for storage units will remain strong.

These are companies with high margins. My lived experience can attest that rising rates are a fact of being a customer. It will take more to store our things. And most of us will pay for it.

As of the date of publication, Chris Markoch had (neither directly nor indirectly) any position in the securities mentioned in this article. The opinions expressed in this article are those of the author, subject to InvestorPlace.com Publication guidelines.

Chris Markoch is a freelance financial writer who has covered the market for over five years. He has been writing for InvestorPlace since 2019.


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