The second half of the year is upon us, and that has the forecasters looking for clues to the near-term economic future. The speculations run nearly the full gamut of possibilities, from a full-blown recession to a mild downturn to a steady-state to a rip-roaring recovery.
Lori Calvasina, US equity strategy head for RBC Capital, is leaning toward that latter outlook. She believes that the US will dodge the recession bullet, and that the S&P 500 will end the year at or near 4,700 (a gain of 23% from current levels). Yet, there is still a chance that conditions could worsen. Calvasina puts the odds of avoiding a recession at 60%.
Is Calvasina correct in her assessment? If so, investors should start to see the benefits by the end of the year. For now, however, RBC’s stock analysts have picked out two equities that can shore up a defensive portfolio position – without giving up the growth potential. These are reliable dividend payers that combine above-average yields with double-digit upside potential. We ran the two through TipRanks database to see what other Wall Street’s analysts have to say about them.
Pactiv Evergreen (PTVE)
First up is Pactiv Evergreen, a manufacturing company in the packaging sector. Specifically, Pactiv focuses on development and production of food and beverage packing materials for use in food services – everything from retail groceries and convenience stores to food processing and take away containers. Everyone has to eat, and we need to carry our food in something; Pactiv leveraged that simple fact to more than $5.4 billion in total revenues last year.
The company appears to be on track for continued revenue strength in 2022. In May, the company released its numbers for 1Q22, and management described the top line as ‘a solid start’ for the year. Q1 revenues came to $1.495 billion, a 28% gain compared to 1Q21. The revenue gains were driven by a combination of 26% growth in price and mix and 9% growth from acquisitions. In addition to sound revenues, Pactiv reported strong earnings in the first quarter, with net income of $43…