BofA's 10 Defensive and Yield Stock Picks for 2013

Wall St Bull statueBank of America Merrill Lynch has issued more picks and a macro-investment strategy for 2013, and the message is rather clear: Be selective and position defensively. The firm said that it sees a December rally carrying over into January, but it also said that there is the risk of a deep correction in 2013.

Bank of America's team sees a rise in 2013 or for a volatility spike in the VIX and the Global Financial Stress Index. Its report said, "As a result, we are becoming more selective and leaning toward attractive yielding equities and defensive sectors." In short, those defensive stocks and high-paying dividends are where the firm is looking. It also said, "We expect the S&P 500 to reach the 1500 area, which is the range of the 2007- 2008 highs. But as we enter 2013, there is the risk of a 10-15% correction."

So, here are themes and picks: Water is a new theme (something probably a bit late); health care and consumer staples are favored, along with telecom, utilities, mega-caps and yield.

Ten stock picks for 2013 with an average yield of 3.8%:

  • Eli Lilly & Co. (NYSE: LLY)
  • Pfizer Inc. (NYSE: PFE)
  • Wal-Mart Stores Inc. (NYSE: WMT) at 2.2%
  • Kimberly Clark Corp. (NYSE: KMB) at 3.4%
  • Altria Group Inc. (NYSE: MO) a 5.3%
  • CenturyLink Inc. (NYSE: CTL)
  • American Electric Power Co. (NYSE: AEP)
  • American Water Works Inc. (NYSE: AWK)
  • Ventas Inc. (NYSE: VTR)
  • Yamana Gold Inc. (NYSE: AUY)


Filed under: 24/7 Wall St. Wire, Analyst Calls, Defensive Stocks, Dividends & Buybacks Tagged: AEP, AUY, AWK, BAC, CTL, KMB, LLY, MO, PFE, VTR, WMT
Read Full Story


DJIA 24,462.94 -201.95 -0.82%
NASDAQ 7,146.13 -91.93 -1.27%
S&P 500 2,670.14 -22.99 -0.85%
NIKKEI 225 22,162.24 -28.94 -0.13%
HANG SENG 30,418.33 -290.11 -0.94%
DAX 12,540.50 -26.92 -0.21%
USD (per EUR) 1.23 0.00 -0.26%
USD (per CHF) 0.97 0.00 0.02%
JPY (per USD) 107.68 0.25 0.24%
GBP (per USD) 1.40 -0.01 -0.57%

Can't get enough business news?

Sign up for Finance Report by AOL and get everything from retailer news to the latest IPOs delivered directly to your inbox daily!

Subscribe to our other newsletters

Emails may offer personalized content or ads. Learn more. You may unsubscribe any time.