With the quick rollout of vaccines, the economy is on the verge of recovery. Major stock indexes have performed well thanks to a strong start to third-quarter earnings season. There has been a drop in initial jobless claims as well as a declining number of COVID-19 patients. We believe quality stocks such as Biogen (BIIB), Bristol-Myers® (BMY) and Ericsson® (BS:), all of which are undervalued at current prices, can be good investments now. Keep reading.
The stock market’s major indices closed last week higher. This was the third consecutive week of gains. The stock market’s performance has been driven by a solid start to third quarter earnings season, declining initial jobless claims and decreasing COVID-19 cases. According to FactSet, 23% of S&P 500 member companies had reported results for the third quarter as of October 22. These 84% companies have exceeded the consensus EPS estimates and are above the 76% 5-year average.

Investors are still concerned by high inflation, potential increases in corporate taxes and supply chain disruptions. But, the impressive earnings season is expected to continue driving the market for the near future. Janet Yellen from the U.S Treasury stated that America isn’t losing control over inflation and expects that inflation levels will be back to normal by 2022’s second-half.

We believe it would be smart to place a bet on high quality stocks such as Bristol-Myers Squibb Company, Biogen Inc. (NASDAQ) and Telefonaktiebolaget LM Ericsson. These stocks are undervalued at current prices.

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