5 Top S&P 500 Stocks At Deep Discount Amid Coronavirus-Led Rout

Wall Street’s free fall, which has been the case in the last four weeks, continues with the three major indexes recording new closing lows almost every day. The situation is just a reversal from the first month of this year when these indexes were posting new closing highs almost regularly.

While we are uncertain as to when the coronavirus-induced market mayhem will finally ease, the major indexes have already reached near the levels when President Donald Trump took charge in January 2017.

Wall Street’s Nightmare Continues

On Mar 18, U.S. stocks faced yet another setback as three major stock indexes — the Dow, the S&P 500 and the Nasdaq Composite — tumbled 6.3%, 5.2% and 4.7%, respectively.

The Dow closed at 19,898.92, just 0.8% above its closing level of Jan 19, 2017, the day before President Trump took charge. Notably, during the intraday trading, the blue-chip index fell below 19,732.40, the closing level of Jan 19, 2017. However, it regained some ground in the last hour of trading.

Meanwhile, the S&P 500 and the Nasdaq Composite ended at 2,398.10 and 6,989.84, respectively. Notably, the broad-market index is currently 5.8% ahead of its closing level of Jan 19, 2017. However, the tech-heavy Nasdaq is still 26.2% above its closing level on the said date.

Moreover, The COBE VIX — popularly known as the best fear gauge of Wall Street — closed at 76.45, significantly higher than its historical average range of 19 to 20. Notably, on Mar 16, VIX ended at a new all-time high of 82.69, surpassing its previous peak level of 80.74 posted on Nov 21, 2008.

Market May Not Be Overvalued Now

Wall Street ended 2019 on an impressive note with the Dow, the S&P 500 and the Nasdaq Composite — rallied 22.3%, 28.9% and 35.2%, respectively. However, the coronavirus-induced downtrend erased almost all the gains. As of Mar 18, these indexes have plummeted 30.3%, 25.8% and 22.1%, respectively, year to date.

Moreover, the Dow, the S&P 500 and the Nasdaq Composite — plunged 32.7%, 29.3% and 29%, respectively, from their all-times highs achieved in mid-February. Moreover, the Dow and the S&P 500 are presently well below their 2018-end levels while the tech-laden Nasdaq is ahead of that level by just 5.3%. Notably, in 2018, these indexes recorded their worst ever yearly performance since 2008.

Our Top Picks

While the market may remain choppy in the next few weeks, currently, plenty of goods stocks are trading at ultra-cheap prices. However, we have narrowed down our search to five such large-cap (market capital > 10 billion) from the S&P 500 stable.

These stocks have positive growth potential for 2020 and are regular dividend payers. Most importantly, each of our picks sports a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The chart below shows the price performance of our five picks in the past month.

Microsoft Corp. (NASDAQ:MSFT) : The share price has depreciated 25.1% in the past four weeks. It currently offers a dividend yield of 1.39%. The company has an expected earnings growth rate of 18.3% for the current year (ending June 2020).

HP Inc. (NYSE:HPQ) : The share price has plummeted 41.6% in the past four weeks. It currently offers a dividend yield of 4.89%. The company has an expected earnings growth rate of 7.6% for the current year (ending October 2020).

Garmin Ltd. (NASDAQ:GRMN) : The share price has tumbled 30.9% in the past four weeks. It currently offers a dividend yield of 3.08%. The company has an expected earnings growth rate of 3.6% for the current year.

Applied Materials Inc. (NASDAQ:AMAT) : The share price has plunged 41.9% in the past four weeks. It currently offers a dividend yield of 1.87%. The company has an expected earnings growth rate of 36.2% for the current year (ending October 2020).

eBay Inc. (NASDAQ:EBAY) : The share price has declined 16.6% in the past four weeks. It currently offers a dividend yield of 1.92%. The company has an expected earnings growth rate of 8.5% for the current year.

Breakout Biotech Stocks with Triple-Digit Profit Potential

The biotech sector is projected to surge beyond $775 billion by 2024 as scientists develop treatments for thousands of diseases. They’re also finding ways to edit the human genome to literally erase our vulnerability to these diseases.

Zacks has just released Century of Biology: 7 Biotech Stocks to Buy Right Now to help investors profit from 7 stocks poised for outperformance. Our recent biotech recommendations have produced gains of +50%, +83% and +164% in as little as 2 months. The stocks in this report could perform even better.

See these 7 breakthrough stocks now>>