Undervalued Stocks That Just Increased Their Dividends

Plus: Cheap biotech stocks, good news on inflation and Arm IPO’s very, very lofty price. [Morningstar](?utm_source=eloqua&utm_medium=email&utm_campaign=newsletter_smartinvestor&utm_content=48117&elqTrackId=946287fc1a03400eb49b2ec6f2fc7051&elq=e33a7af416d24d838d708ce1b3ec6c54&elqaid=48117&elqat=1&elqCampaignId=23813) [Smart Investor] Smart Investor [Tom Lauricella, chief markets editor]( Connect with Tom on [LinkedIn]( [Tom Lauricella] In this newsletter: - [5 Undervalued Stocks That Just Increased Their Dividends]( - [6 Undervalued Biotech Stocks]( - [Arm IPO: A Dominant Chip Designer but at a ‘Very, Very’ Lofty Price]( - [Avoiding China Has Been a Winning Bet for These Equity Funds]( - [Consumer Spending Slowdown May Be Coming—Here’s What That Means for Stocks]( The animal spirits are back. It’s been two years since we last saw a feeding frenzy for an IPO like we did this past week for semiconductor chip designer Arm. The stock popped a frothy 25% on its first day trading, after already coming in at what at a Morningstar analyst called a “very, very” expensive offering price. You can find Morningstar’s (independent) view on the Arm IPO, why it’s a dominant player, but also why investors should be treading carefully, [here](. Perhaps fueling the confidence among investors to venture into riskier fare is the growing belief that the coast is almost—or already—clear on future Federal Reserve interest rate hikes. That sentiment was given a boost by the latest Consumer Price Index report. Lauren Solberg and Preston Caldwell take a look into the August CPI and [explain why it was good news](. Stay tuned for our coverage of this coming week's Fed meeting. Still there is a potential speedbump for the stock market ahead in the form of a slowdown in consumer spending. As [Sarah Hansen explains]( a resilient consumer has been an important driver to the stock market rally, but there are reasons for caution. One critical cog in the global economy that hasn't been turning: China. We’ve got two articles this week tied to this theme. The first article asks [what kind of impact a China economic slowdown]( could have the global economy—including inflation (hint: It’s actually good news there). In the second article, Katherine Lynch looks at the growing crop of emerging-markets funds that don’t invest in China and [finds some good news for investors in those strategies](. Back in the U.S. stock market, we’ve got a few screens to offer up this week. The first is we have taken another dive into the Morningstar database to find undervalued stocks that just raised their dividends. In total we have 10 new names since we [last ran]( this screen, but we highlight [five with the biggest dividend hikes](. Also this week, we combed through the ranks of biotech stocks for [names trading at discounted prices](. We came up with six, including one that practically became a household name during the coronavirus pandemic. Lastly, our fund screen for the week looks for the top-performing short-term bond funds. In this environment, these names are also offering attractive yields. [Here’s our list of three](. That's it for the week! As always, check out our [Markets page]( for our latest coverage and live stock market updates, along with our [weekly calendar]( of key upcoming data and events. Did a friend forward this email? [Sign up here](. [5 Undervalued Stocks That Just Increased Their Dividends]( [5 Undervalued Stocks That Just Increased Their Dividends]( Bank of America, Tapestry, and General Mills are among the stocks with higher dividend payouts. [Read More]( Share: [facebook]( [twitter]( [linkedin]( ADVERTISEMENT [media]( [media] Markets and the Economy [A Consumer Spending Slowdown May Be Coming—Here’s What That Means for Stocks]( [A Consumer Spending Slowdown May Be Coming—Here’s What That Means for Stocks]( A resilient consumer has been an important tailwind for the stock market. Sarah Hansen, Caryl Anne Francia [Weekly Markets Planner: Economics Calendar, Company Earnings, Investor Relations Events]( [Weekly Markets Planner: Economics Calendar, Company Earnings, Investor Relations Events]( Federal Reserve meeting and PMI data, plus earnings from FedEx and General Mills. Caryl Anne Francia [3 Biggest Mutual Fund Downgrades of 2023]( [3 Biggest Mutual Fund Downgrades of 2023]( We took these well-known funds down a notch or two. Russ Kinnel [6 Undervalued Biotech Stocks]( [6 Undervalued Biotech Stocks]( These stocks from the Morningstar US Biotechnology Index look cheap. Saaketh Tirumala [What’s Going on With Consumers?]( [What’s Going on With Consumers?]( The postpandemic spending bonanza may be coming to an end. What does this mean for stocks? Michael Field [August CPI Report Shows Good News on Inflation Despite Jump in Gas Prices ]( [August CPI Report Shows Good News on Inflation Despite Jump in Gas Prices]( With core inflation normalizing, the Fed has breathing room to pause rate hikes. Lauren Solberg [Avoiding China Has Been a Winning Bet for These Equity Funds]( [Avoiding China Has Been a Winning Bet for These Equity Funds]( A gloomy economic outlook and ESG concerns have more funds and investors shunning the country’s stocks. Katherine Lynch [Why TIPS Look Attractive]( [Why TIPS Look Attractive]( They may not appear to be, but TIPS are a safer bet than conventional bonds today. John Rekenthaler [3 Top-Performing Short-Term Bond Funds]( [3 Top-Performing Short-Term Bond Funds]( Short-term bond funds from Pimco, PGIM, and FPA have delivered for investors during a time of rising interest rates. Sadhika Thapa [Undervalued by 30%, This High-Quality Stock Is a Buy]( [Undervalued by 30%, This High-Quality Stock Is a Buy]( This cheap wide-moat stock stands to benefit from long-term trends in healthcare. Debbie Wang [Are ‘Cash-Plus’ Strategies Really a Cash Cow Today?]( [Are ‘Cash-Plus’ Strategies Really a Cash Cow Today?]( Funds that keep assets in cash stand to benefit from higher interest rates. But the relationship is not as straightforward as it seems. Madeline Hume [After Earnings and Big Stock Drop, Are Oracle Shares a Buy?]( [After Earnings and Big Stock Drop, Are Oracle Shares a Buy?]( Amid light revenue and moderate growth prospects, here’s what we think of Oracle stock. Julie Bhusal Sharma [What the First-Ever UAW Strike at All Three Detroit Automakers Could Mean]( [What the First-Ever UAW Strike at All Three Detroit Automakers Could Mean]( We expect rolling, local strikes lasting several months; auto stock earnings in jeopardy. David Whiston [Arm IPO: A Dominant Chip Designer but at a ‘Very, Very’ Lofty Price]( [Arm IPO: A Dominant Chip Designer but at a ‘Very, Very’ Lofty Price]( Shares of SoftBank’s Arm Holdings rallies nearly 25% after being priced at $51 per share. Sarah Hansen [Warren Buffett's Berkshire Hathaway Sold This Stock. Should You?]( [Warren Buffett's Berkshire Hathaway Sold This Stock. Should You?]( Warren Buffett’s behemoth has scaled back its sizable position in this technology stock. Susan Dziubinski, William Kerwin [Why Higher Interest Rates May Mean Higher Taxes for Investors]( [Why Higher Interest Rates May Mean Higher Taxes for Investors]( Where you keep your income-generating investments is even more important in 2023. Christine Benz, Susan Dziubinski [Measuring ESG Risk in 3 Undervalued Small-Cap and Emerging-Markets Stocks]( [Measuring ESG Risk in 3 Undervalued Small-Cap and Emerging-Markets Stocks]( The Morningstar Sustainalytics ESG Risk Smart Score is a first stop for hard-to-research companies. Adam Fleck [Apple: We’re Pleased With iPhone 15 and Watch Innovations, but Stock is Still Rich]( [Apple: We’re Pleased With iPhone 15 and Watch Innovations, but Stock is Still Rich]( Apple shows off its expertise and competitive advantage with its lineup update. Brian Colello [Adobe: Creative Cloud Drives Strength While Firefly AI Begins to Produce Revenue]( [Adobe: Creative Cloud Drives Strength While Firefly AI Begins to Produce Revenue]( With strong third quarter results and a strong run for the stock, here’s what we thought of Adobe earnings. Dan Romanoff Chart of the Week [12 Must-See Charts for Investors in September 2023]( [12 Must-See Charts for Investors in September 2023]( The charts and themes that tell the current story in markets and investing. Danny Noonan [Read More]( Share: [facebook]( [twitter]( [linkedin]( Popular This Week [The Best Stock ETFs]( These exchange-traded funds that invest in stocks earn Morningstar’s top rating in 2023. [4 Undervalued Stocks to Buy Before the Fed Cuts Interest Rates]( Plus, our new forecast for economic growth, inflation, and interest rates. [The Best Vanguard Funds]( These top-rated ETFs and mutual funds are excellent choices to buy and hold in 2023 and beyond. [It’s Time to Consider TIPS]( Evaluating an often-misunderstood investment. [The 10 Best Dividend Stocks]( These undervalued stocks with reliable dividends are worth considering. Future-Proof Your Strategy With Morningstar Investor Build a portfolio that's durable, no matter what the market throws your way. 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