Chicago, IL – March 11, 2025– Today, Zacks Investment Ideas feature highlights Molson Coors TAP, Merck & Co. MRK and Deutsche Telekom DTEGY.
Safe-Haven Stocks: 3 Top Picks for Navigating Volatility
After two years of steady gains, the stock market is now experiencing one of its sharpest corrections in recent history. US stock indexes have entered correction territory, with technology and semiconductor stocks—the same industries that fueled the rally—leading the decline. Investor confidence has been shaken by uncertainty surrounding tariffs and broader economic policy under the new presidential administration. However, it's important to put this market action into perspective.
A 10% correction is a normal and frequent occurrence in the US stock market, historically happening at least once per year. While these pullbacks can feel unsettling, history suggests that they are rarely the start of a major or prolonged downturn. That said, it's impossible to predict the exact depth or duration of this correction, which is why many investors are shifting toward defensive stocks that offer stability in uncertain environments.
Molson Coors, Merck & Co. and Deutsche Telekom are three stocks that have shown resilience in volatile markets, and each has bullish catalysts that go beyond just their defensive appeal. Below, I'll break down why these companies stand out as strong investment opportunities in today's market.
Molson Coors: Strong Stock, Top Zacks Rank, Cheap Valuation
Molson Coors is one of the world's largest brewing companies, producing some of the most well-known beer brands, including Coors Light, Miller Lite, Blue Moon, and Molson Canadian. With a strong presence in North America and Europe, the company benefits from steady consumer demand for its products, even during economic downturns. Consumer Staple stocks can often act as reliable defensive plays during market volatility.
Molson Coors currently holds a Zacks Rank #1 (Strong Buy), driven by rising earnings estimates and positive analyst sentiment. Over the past month, earnings projections have increased by as much as 9.4%, signaling growing confidence in the company's financial outlook.
In addition to strong earnings momentum, Molson Coors trades at a compelling valuation, with a forward earnings multiple of just 9.8x. This represents a significant discount not only relative to the broader market but also to its own historical norms, as the stock's 10-year median forward multiple stands at 13.1x. With both value and defensive stability, TAP remains an attractive investment in the current market environment.
Deutsche Telekom: European Stocks Outperform
Deutsche Telekom is one of the largest telecommunications companies in the world, providing mobile, broadband, and digital services across Europe and the United States. The company also owns T-Mobile US (TMUS). In Europe, Deutsche Telekom dominates key markets, offering a combination of high-speed internet, mobile services, and enterprise solutions. Also notable, European stocks have shown a surprising outperformance against their US counterparts, a significant reversal of recent years and added benefit for DTEGY.
Deutsche Telekom boasts a Zacks Rank #1 (Strong Buy) rating, reflecting upward trending earnings revision. The company is projected to grow its earnings 11.3% annually over the next three to five years, an impressive rate for a mature telecom company.
Today, DTEGY is trading at a one year forward earnings multiple of 16.6x, which is above its 10-year median of 14.7x and right in line with the industry average. With European stocks outperforming and analysts upgrading Deutsche Telekom, it could be a compelling addition to investors' portfolios.
Merck & Co: Stock Rising from the Depths as Healthcare Leads
Merck & Co. is a global pharmaceutical powerhouse with a diverse portfolio of blockbuster drugs, vaccines, and treatments spanning oncology, immunology, and infectious diseases. The company is best known for Keytruda, its industry-leading immunotherapy treatment for various cancers, which has driven significant revenue growth.
Merck stock has struggled in recent years but appears to have found a bottom rallying 20% off its recent lows in the last two weeks. It appears to be an opportune time to pick up the stock as it is currently trading at just 10.5x forward earnings, well below the industry average and its 10-year median of 14.9x.
Even more encouraging is Merck's growth forecasts relative to its valuation. Earnings are projected to grow 12.7% annually over the next three to five years, giving MRK a PEG ratio of just 0.82, a discount based on the metric.
With healthcare stocks offering strong defensive positioning and Merck trading at a discount, it presents a compelling opportunity for investors looking for stability and long-term value.
Should Investors Buy Shares in TAP, DTEGY and MRK?
With the market experiencing heightened volatility, investors looking for stability should consider defensive stocks with strong fundamentals. Molson Coors, Deutsche Telekom, and Merck offer diversified opportunities for defensive positions, with their own set of bullish drivers.
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performancefor information about the performance numbers displayed in this press release.
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