Stick With Businesses with Steady Demand

Some companies are cyclical. Others are not, having steady demand for their products. While the former can have bigger moves during the right part of the cycle, slow-and-steady players tend to reward investors well over time.

  • Special: See What One Ticker... One Trade... EVERY WEEK...Can Do for YOU
  • Examples include defensive companies like consumer goods. In that orbit are a number of similar industries that tend to have steady demand, even in a slowing economy.

    One such space is the restaurant industry. Consumers tend to downshift on dining out before giving it up entirely. And while many may be skipping on going out altogether, pizza delivery tends to have steady demand.

    That fares well for a number of firms. Domino’s Pizza (DPZ) has been a steady player, with revenues rising 3 percent in the past year, giving it some protection from today’s high inflation.

    Yet shares have fallen by one-third in the current bear market. That’s put shares at 21 times forward earnings, a solid discount to where the stock usually trades.

  • Special: Legendary CBOE Trader Reveals: Make This ONE Trade Every Time The Government Drops Economic Reports
  • Action to take: The company has been a great long-term success and is set up to stay that way for a long time. While it faces short-term challenges the same as any in the food industry, it doesn’t have the problem of a restaurant, which requires a larger space and staff to operate.

    Domino’s has also been great with paying a growing dividend, which currently yields about 1.4 percent.

    For traders, options are a bit pricey. But the March 2023 $450 calls, last going for about $3.80, can potentially deliver double-digit growth in the months ahead.


    Disclosure: The author of this article has no position in the company mentioned here, but may trade after the next 72 hours. The author receives no compensation from any of the companies mentioned in this article.

  • Special: See What One Ticker... One Trade... EVERY WEEK...Can Do for YOU