American International Group Inc (AIG), Becton & More: Earnings Preview

Unfortunately, I cannot recommend Kellogg Company (NYSE:K)’s stock for the next 12 months, as I believe shares will begin to sell off in a rising interest environment. The stock currently trades at 25x price-to-earnings, a high multiple for a low beta household products company.

Foolish Bottom Line

With nearly half of S&P 500 companies yet to report earnings, the jury is still out whether investors can declare victory during the first quarter.

However, insurance giant American International Group Inc (NYSE:AIG), health care provider Becton, Dickinson and Co. (NYSE:BDX), and household products giant Kellogg Company (NYSE:K) are long-term investments that should be bought on fundamentals. Upcoming earnings reports will provide greater clarity on the long-term story.

Based on recent market prices, I believe AIG and BD are priced attractively for new investors. American International Group Inc (NYSE:AIG)’s turnaround story is gaining traction, and the company’s dividend will likely be reinstated this year. BD is an attractive growth story based on unmet medical needs in emerging markets such as China and India, where demand for medical supplies will increase many times over in coming years.

Unfortunately, Kellogg Company (NYSE:K) is priced for perfection in my opinion and the stock trades at a record high 25x price-to-earnings. I recommend that readers sell Kellogg as shares will likely fall in a rising interest rate environment.

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The article A Look at Fundamentals Ahead of Upcoming Earnings originally appeared on Fool.com.

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