The Federal Reserve looks set to start cutting interest rates in September.
Using the InvestingPro, I identified several undervalued stocks that are poised to benefit from falling borrowing costs.
As such, discussed below are three stocks worth owning as the U.S. central bank prepares to lower interest rates in the months ahead.
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As the Federal Reserve prepares to potentially cut interest rates, investors have a unique opportunity to position themselves for substantial gains. Lower rates can have a pronounced positive impact on certain sectors, particularly those sensitive to borrowing costs.
Harnessing the power of InvestingPro, I identified several undervalued stocks that are poised to benefit from falling borrowing costs. This professional tool directed to the retail investor offers several features that can assist investors in identifying high-quality stocks with strong potential upside.
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Among these stocks, here are three names that stand to benefit significantly from a rate cut and are currently undervalued, as per the AI-powered quantitative models in InvestingPro, presenting attractive entry points.
1. Kraft Heinz
2024 Year-To-Date: -4.3%
Market Cap: $42.8 Billion
Kraft Heinz (NASDAQ:), a leading global food and beverage company, offers a strong dividend of $1.60 per share at a relatively high yield of 4.52%, making it an attractive option as interest rates begin to fall. The company’s portfolio includes household names such as Heinz, Kraft, Oscar Mayer, and many others.
Source: Investing.com
Falling interest rates would reduce Kraft Heinz’s debt servicing costs, allowing the company to allocate more capital towards growth initiatives, such as expanding its product lines or entering new markets. This financial flexibility can enhance its competitive position and support higher earnings.
Why Buy:
Attractive Dividend: With a high yield, Kraft Heinz is…..
