{"id":295725,"date":"2022-10-04T17:01:09","date_gmt":"2022-10-04T21:01:09","guid":{"rendered":"https:\/\/stockchase.com\/discover\/?p=295725"},"modified":"2022-10-05T21:57:16","modified_gmt":"2022-10-06T01:57:16","slug":"mixed-bag-of-3-defensive-stocks","status":"publish","type":"post","link":"https:\/\/stockchase.com\/discover\/mixed-bag-of-3-defensive-stocks\/","title":{"rendered":"Mixed Bag of 3 Defensive Stocks"},"content":{"rendered":"<p>This week we offer a mixed bag of defensive stocks in American healthcare, semiconductors and transports. Some of these pay a higher dividend than others, one is a buy on dips, while all are long-term buys.<\/p>\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_82_2 counter-hierarchy ez-toc-counter ez-toc-grey ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Discover What&#039;s Inside<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #999;color:#999\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #999;color:#999\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 eztoc-toggle-hide-by-default' ><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/stockchase.com\/discover\/mixed-bag-of-3-defensive-stocks\/#Eli_Lilly_Co_LLY-N_Biogen_IDEC_Inc_BIIB-Q\" >Eli Lilly &amp; Co. (LLY-N) \/ Biogen IDEC Inc. (BIIB-Q)<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/stockchase.com\/discover\/mixed-bag-of-3-defensive-stocks\/#Skyworks_Solutions_Inc_SWKS-Q\" >Skyworks Solutions Inc. (SWKS-Q)<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-3'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/stockchase.com\/discover\/mixed-bag-of-3-defensive-stocks\/#Cargojet_Inc_CJT-T\" >Cargojet Inc (CJT-T)<\/a><\/li><\/ul><\/nav><\/div>\n<h3><span class=\"ez-toc-section\" id=\"Eli_Lilly_Co_LLY-N_Biogen_IDEC_Inc_BIIB-Q\"><\/span><a href=\"https:\/\/stockchase.com\/company\/view\/729\/LLY-N\">Eli Lilly &amp; Co. (LLY-N)<\/a> \/ <a href=\"https:\/\/stockchase.com\/company\/view\/1720\/BIIB-Q\">Biogen IDEC Inc. (BIIB-Q)<\/a><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p><img alt=\"BIIB-Q stock chart\" decoding=\"async\" class=\"alignnone size-medium wp-image-296036\" src=\"https:\/\/stockchase.com\/discover\/wp-content\/uploads\/2022\/10\/BIIB-Q-1-760x254.png\" width=\"860\" \/><\/p>\n<p><a href=\"https:\/\/stockchase.com\/company\/view\/1720\/BIIB-Q\">Biogen<\/a> <img alt=\"BIIB-Q stock price chart\" decoding=\"async\" src=\"https:\/\/data.wealthica.com\/api\/securities\/BIIB-Q\/chart?labels=tru\" width=\"125\" align=\"right\" \/> soared 40% on September 28 on news of the positive test results of its Alzheimer&#8217;s drug, Iecanemab. One analyst guessed that the drug could generate $8 billion in peak sales. However, the drug still needs to pass further testing, and investors are still haunted by Aduhelm, another Alzheimer&#8217;s that did get approved, back in June 2021, but its sales have fallen short of expectations, because Medicare isn&#8217;t convinced it works and won&#8217;t pay for it.<\/p>\n<p>The call: take profits on Biogen.<\/p>\n<p><img alt=\"RM2VEtA4\" decoding=\"async\" class=\"alignnone size-medium wp-image-296039\" src=\"https:\/\/stockchase.com\/discover\/wp-content\/uploads\/2022\/10\/RM2VEtA4-1-760x254.png\" width=\"860\" \/><\/p>\n<p>You could then take that money and put it in <a href=\"https:\/\/stockchase.com\/company\/view\/729\/LLY-N\">Eli Lilly<\/a>. <img alt=\"LLY-N stock price chart\" decoding=\"async\" src=\"https:\/\/data.wealthica.com\/api\/securities\/LLY-N\/chart?labels=tru\" width=\"125\" align=\"right\" \/> There&#8217;s potential in LLY stock&#8217;s own Alzheimer&#8217;s drug. Also, the street is putting its hopes into LLY&#8217;s weight-loss drug, Mounjaro, when it starts selling in two or three years. After all, diabetes as at an all-time high in America. One analyst envisioned $25 billion in peak sales, outstripping <a href=\"https:\/\/stockchase.com\/company\/view\/4425\/ABBV-N\">AbbVie<\/a>&#8216;s Humira which has topped $20.7 billion. However, the street is getting a little ahead of itself, since the FDA has approved Mounjaro for glycemic control in T2D patients, and LLY still needs to submit the drug as a treatment for weight-loss.<\/p>\n<p>Other drugs in the LLY pipeline include BIF (Basil-Insulin FC), a once-a-week insulin, and Retevmo to treat cancer. Testing continues on these drugs.<\/p>\n<p>For the immediate future, Lilly&#8217;s EPS is expected to grow 23% and lets it trade at a premium of 52.5x PE. Compare that to AbbVie&#8217;s 20.2x or <a href=\"https:\/\/stockchase.com\/company\/view\/811\/MRK-N\">Merck<\/a>&#8216;s 13.2x. You&#8217;re buying Eli Lilly for share appreciation, since it pays only a 1.27% dividend yield. AbbVie distributes 3.99% and Merck 3.2%. Another caveat: LLY stock missed its last quarter, Q2, wth EPS coming in at $1.30 instead of the expected $1,80.<\/p>\n<p>Despite that, the street targets $370.57 for LLY stock, based on eight buys. After all, company margins compare well to its peers with a 17.83% ROI, above the industry average of 16.18% and a ROE of 76% that beats the industry&#8217;s 44%. Overall, Eli Lilly&#8217;s pipeline looks robust enough to warrant a buy, buy on weakness.<\/p>\n<p><img alt=\"SWKS-Q stock chart\" decoding=\"async\" class=\"alignnone size-medium wp-image-296040\" src=\"https:\/\/stockchase.com\/discover\/wp-content\/uploads\/2022\/10\/SWKS-Q-1-760x254.png\" width=\"860\" \/><\/p>\n<h3><span class=\"ez-toc-section\" id=\"Skyworks_Solutions_Inc_SWKS-Q\"><\/span><a href=\"https:\/\/stockchase.com\/company\/view\/3298\/SWKS-Q\">Skyworks Solutions Inc. (SWKS-Q)<\/a><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>Anyone following semiconductor stocks has a sore ass from riding the rollercoaster, but it&#8217;s worth hanging onto this stock. <a href=\"https:\/\/stockchase.com\/company\/view\/3298\/SWKS-Q\">Skyworks<\/a> <img alt=\"SWKS-Q stock price chart\" decoding=\"async\" src=\"https:\/\/data.wealthica.com\/api\/securities\/SWKS-Q\/chart?labels=tru\" width=\"125\" align=\"right\" \/> supplies chips to cars, homes and for industrial uses. Global wireless activity is projected to increase 27% annual for the next five years. By 2030, connected cars will use 25 times the amount of data of today&#8217;s smartphones. Speaking of which, Skywork&#8217;s big outlet is phones, specifically those that will use the 5G network and more precisely iPhones. More on this in a second.<\/p>\n<p>SWKS stock pays a 2.63% dividend yield based on a low 28.18% payout ratio in a space that seldom pays anything. In fact, the company raised its divvy by 11% in August, which means eight straight years of dividend growth or an 463.6% increase since it started paying a dividend.<\/p>\n<p>The stock trades at a 11.35x PE, which is a far cry from <a href=\"https:\/\/stockchase.com\/company\/view\/1271\/TSM-N\">Taiwan Semiconductor<\/a>&#8216;s 15x. Also, earnings outstrip at $7.87 vs. TSM&#8217;s $4.62, though SWKS&#8217; profit margin of 24.11% is a long way from TSM&#8217;s 40.62%. Despite the turmoil in tech, Skyworks has beaten or met its last four quarters.<\/p>\n<p>Back to <a href=\"https:\/\/stockchase.com\/company\/view\/4\/AAPL-Q\">Apple<\/a>: A decade ago, Apple made up 29% of Skyworks&#8217; revenues and now represents 55%. Partnering with one of the strongest companies in the world as the world transitions to 5G is a definite plus. A distant caveat, though, is what happens when we roll out 6G?<\/p>\n<p>The company has been wise to actively diversify. For example, in July 2021, Skyworks bought Silicon Laboratories to strengthen its presence in EV&#8217;s, hybrids, data centres and other applications. In the quarter ending June 30, broad markets (or the internet of things) made up 38% of SWKS stock&#8217;s total revenues, so the company is moving in the right direction as it continues to thrive with Apple. With shares down 42% for the year, Skyworks is a buying opportunity.<\/p>\n<p><img alt=\"CJT-T stock chart\" decoding=\"async\" class=\"alignnone size-medium wp-image-296037\" src=\"https:\/\/stockchase.com\/discover\/wp-content\/uploads\/2022\/10\/CJT-T-1-760x254.png\" width=\"860\" \/><\/p>\n<h3><span class=\"ez-toc-section\" id=\"Cargojet_Inc_CJT-T\"><\/span><a href=\"https:\/\/stockchase.com\/company\/view\/2836\/CJT-T\">Cargojet Inc (CJT-T)<\/a><span class=\"ez-toc-section-end\"><\/span><\/h3>\n<p>Perhaps no Canadian chart mirrors the pandemic era better than <a href=\"https:\/\/stockchase.com\/company\/view\/2836\/CJT-T\">Cargojet<\/a>. <img alt=\"CJT-T stock price chart\" decoding=\"async\" src=\"https:\/\/data.wealthica.com\/api\/securities\/CJT-T\/chart?labels=tru\" width=\"125\" align=\"right\" \/> In February 2020, it topped $122, then plunged to $86 two months later in the depths of the first lockdown, then soared like a rocket to $242 as e-commerce took off. A slow, post-pandemic unwinding has left shares at $116 today. As its name implies, Cargojet delivers stuff on planes, including 90% of packages that travel between Toronto and Vancouver overnight. However, transports have been beaten silly lately (witness <a href=\"https:\/\/stockchase.com\/company\/view\/471\/FDX-N\">FedEx<\/a> shares after it called for a global recession). This group faces higher fuel costs and a labour shortage. Add to that fears of a recession in coming months to slow down their traffic. No wonder that Cargojet shares have slid 41% in the past year and returned to levels of March 2020, when the pandemic hit full-throttle.<\/p>\n<p>So, was CJT\u00a0a pandemic play, wasn&#8217;t it? Yes, it was, but the stock still has a future. Last March, the company struck a <a href=\"https:\/\/www.newswire.ca\/news-releases\/cargojet-announces-long-term-strategic-agreement-with-dhl-to-provide-global-air-transportation-services-856472891.html\" target=\"_blank\" rel=\"noopener\">five-year deal<\/a> to supply aircraft to courier DHL around the globe. In return, DHL obtained 9.5% of CJT stock. After a very mixed earnings record in the past year, CJT handily beat its last quarter at $9.12 EPS vs. an expected $1.59. (Its Q3 will deliver on Hallowe&#8217;en.) Shares have been beaten down so badly that Cargojet looks oversold. In fact, Bay Street targets $203.82 on the name. That&#8217;s a little high in my book, but there&#8217;s likely more upside here than further downside. CJT trades at a 10.53x PE, but its forward PE is 15.11x.<\/p>\n","protected":false},"excerpt":{"rendered":"<p>This week we offer a mixed bag of defensive stocks in American healthcare, semiconductors and transports. Some of these pay a higher dividend than others, one is a buy on dips, while all are long-term buys. Eli Lilly &amp; Co. [&hellip;]<\/p>\n","protected":false},"author":12,"featured_media":296038,"comment_status":"open","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"cwp_meta_box_check":"No","cwp_rev_product_name":"","cwp_rev_product_image":"","wppr_links":[],"cwp_rev_price":"","wppr_options":[],"wppr_pros":[],"wppr_cons":[],"footnotes":""},"categories":[17],"tags":[],"class_list":["post-295725","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-lists"],"wppr_data":{"cwp_meta_box_check":"No"},"_links":{"self":[{"href":"https:\/\/stockchase.com\/discover\/wp-json\/wp\/v2\/posts\/295725","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/stockchase.com\/discover\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/stockchase.com\/discover\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/stockchase.com\/discover\/wp-json\/wp\/v2\/users\/12"}],"replies":[{"embeddable":true,"href":"https:\/\/stockchase.com\/discover\/wp-json\/wp\/v2\/comments?post=295725"}],"version-history":[{"count":0,"href":"https:\/\/stockchase.com\/discover\/wp-json\/wp\/v2\/posts\/295725\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/stockchase.com\/discover\/wp-json\/wp\/v2\/media\/296038"}],"wp:attachment":[{"href":"https:\/\/stockchase.com\/discover\/wp-json\/wp\/v2\/media?parent=295725"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/stockchase.com\/discover\/wp-json\/wp\/v2\/categories?post=295725"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/stockchase.com\/discover\/wp-json\/wp\/v2\/tags?post=295725"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}