To The Moon

These seven safest stocks should be prioritized during a volatile market.

• Costco : A recent selloff has paved the way for a long-term investment in this safe stock.
• Taiwan Semiconductor : A global chip shortage has driven up the company's profitability and the stock is now undervalued after a selloff.
• Broadcom : The company's recent acquisition of VMware paves the way for more growth and its stock has shown strength through a recent rebound.
• Coca-Cola: KO stock continues on a stable uptrend since the Great Recession and Coca-Cola has managed to turn around its declining revenue.
• Flowers Foods: The company pays regular dividends due to solid finances and the stock is in a long-term uptrend despite short-term volatility.
• PepsiCo: PepsiCo is among the largest companies and it still maintains a robust growth in its profitability. This massive brand isn't going to be out of demand anytime soon.
• McDonald: MCD has continued to be among the safest stocks to invest in. The company's exceptional performance during the Great Recession makes it a clear buy.

Source: Andy Dean Photography / Shutterstock

The current short-term recovery has put the stock market at a crucial point. Many stocks have been devastated by recent selloffs and investors are still split on whether or not the market is in oversold territory yet. While some point to the Federal Reserve’s (Fed) planned interest rate hikes and call for a recession, others point to oversold stocks to justify another market rally.

Whatever it might be, it is clear that the stock market is currently highly volatile. There are unprecedented levels of uncertainty as the Fed has to battle both inflation and a contracting economy. Unlike in 2008 and 2020, the Fed cannot use quantitative easing to stimulate the economy. Doing so will only add more fuel to inflation. Therefore, the current situation is especially risky.

Of course, some sectors, such as tech, are certainly being hit harder. However, many stocks continue to be overvalued compared to the rest of the stock market and could still go lower. With that in mind, investing in safe and stable stocks is a good option.

Thus, the following seven safest stocks are unlikely to be as volatile:

Costco 

Costco  could be a bargain stock after its sharp selloff. The stock has likely bottomed out and could continue to go up due to its solid finances in the long run.

Costco has seen growth in both its revenue and net income this quarter. The company has also increased its net profit margin and earnings per share (EPS). Even though its price-to-earnings (P/E) ratio is still relatively high, the stock has performed exceptionally well in turbulent times. In addition, the company is in astable long-term uptrendin its financials.

Moreover, Costco’s membership model has helped it combat inflation better than its competitors. Therefore, the current rebound of COST stock could be an excellent opportunity to get in on the stock.

Taiwan Semiconductor 

Taiwan Semiconductor Manufacturing Company Limited (NYSE:TSM) had a  negative 33% selloff which has since cooled down significantly and the stock could be eyeing a rebound. Theglobal shortage of semiconductorshas led to the stock soaring by more than 200% after the pandemic. However, the recent selloff has likely dragged the stock below its intrinsic value.

Taiwan Semiconductor hasreported robust financials this quarter. Year-over-year (YOY), quarterly revenue and net income grew at 35.5% and 45.13%, respectively. This is due to a high demand for semiconductors. Moreover, the net profit margin of Taiwan Semiconductor is also extraordinary at 41.28%, which grew by 7.11% this quarter.

In addition, the semiconductor shortage is unlikely to be solved soon. Supply chain issues persist and the company will continue to profit from the high demand and increased prices for semiconductors. It is among the safest stocks due to its exceptional growth.

Broadcom 

Broadcom  is a company that manufactures and supplies a wide range of hardware and software products, including semiconductors.

The company’s stock has seen stable growth in the market with very little volatility. In addition, its financials are robust, with its YOY quarterlyrevenueandnet incomegrowing at 15.79% and 83.9%, respectively.

Moreover, the company has announced thatit will be acquiring VMware,Inc.(NYSE:VMW) for $69.1 billion, signaling a secure financial position.

Nonetheless, investors should still be careful in the short-term as the VMware deal could add some volatility to the stock. However, AVGO is likely to remain among the safest stocks in the long-term.

Coca-Cola

Coca-Cola is one of the safest stocks to buy. The stock has always remained stable with very little volatility. Even in the current volatile market, KO stock has remained an outlier.

Furthermore, this household brand is unlikely to die out. Even in the worst-case scenario, Coca-Cola is likely to remain profitable in the long-term. Moreover, the company is now financially stable after a long-term downtrend inrevenue, which will continue to aid its growth.

In the latest quarter,Coca-Cola beat its EPS and revenue estimatesby 10.44% and 6.82%. The company’s YOY quarterly revenue grew by 16.31% to $10.5 billion and itsnet incomeincreased by 23.88% to $2.78 billion. In addition, despite heavy losses due to the coronavirus pandemic and the subsequent supply chain issues, the company has recovered in almost all aspects. Therefore, I expect KO to be a safe stock to hold long-term.

Flowers Foods

Flowers Foods is a bakery food company. FLO is among the safest stocks and has continued on a long-term uptrend, despite multiple downturns.

Flowers Foods also has solid financials and hasn’t had any significant losses. In the current market downturn, FLO stock has maintained its uptrend and the company’s financials remained stable.

Flowers Foods had a YOY quarterlyrevenuegrowth of 10.27% to $1.44 billion and itsnet incomegrew by 19.4% to $85.6 million in the latest quarter. Moreover, the company alsobeat its earnings estimatesby 15.79% and recentlyincreased its dividendby 22 cents per share. Thus, FLO is likely to remain a safe stock due to its stable finances.

PepsiCo

PepsiCo, Inc.(NASDAQ:PEP) is a similar company to Coca-Cola. However, PEP stock has historically been more stable than KO and PepsiCo’s profitability is significantly higher.

This quarter, PepsiCo has delivered robust growth, with its YOY quarterlynet incomeandrevenueincreasing by 148.6% and 9.31%, respectively. Moreover, the stock hasn’t been very affected by the recent market volatility and has continued on a long-term uptrend.

Even during a recession, PepsiCo products will remain in high demand. The brand is a significant one and the company is likely to remain profitable for the foreseeable future.

McDonald

McDonald is a no-brainer when discussing safe stocks. MCD stock is one of the most resistant when it comes to volatile markets and recessions. Even during the Great Recession, the stock grew by 7% and the company’s financialsflourished.

Even more surprisingly, McDonald’s quickly recovered from the coronavirus recession, which hit restaurants particularly hard. Moreover, the company reversed itsrevenuedowntrend after the pandemic.

Admittedly, the latest quarter was not the company’s strongest. However, McDonald’s stillmanaged to beat earnings expectations. With historical performance in mind, MCD stock is likely to continue on a long-term uptrend.