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5 ETFs & Stocks to Profit From One-Year High U.S. Inflation

Sanghamitra Saha

The U.S. annual inflation rate rose to 2.1% in November 2019 from 1.8% in the previous month and beat market consensus of 2.0%. This marked the highest rate since November 2018. The core inflation rate, which excludes items like food and energy, was same at 2.3%, matching market expectations. Sequentially, consumer prices rose 0.3% in November, after a 0.4% uptick in October and higher-than-market forecasts of 0.2%.

Below we highlight a few areas and their related ETFs that may gain from this inflation report.

Medical Care Commodities

Medical care commodities saw a price gain of 0.6% in November on an annual basis after a gain of 1% in October. This calls for a look at this healthcare ETF.

iShares U.S. Medical Devices ETF IHI – The underlying Dow Jones U.S. Select Medical Equipment Index measures the performance of the medical equipment sector of the U.S. equity market.

Apollo Endosurgery Inc. APEN -- It is engaged in designing and manufacturing of medical devices for weight loss solutions and gastrointestinal disorders. The stock has a Zacks Rank #2 (Buy).

Medical Care Services

Medical care services logged 5.1% gains in November, same as October.

iShares U.S. Healthcare Providers ETF IHF – The underlying Dow Jones U.S. Select HealthCare Providers Index of the fund measures the performance of health care providers’ sub-sector of the U.S. equity market. It includes health maintenance organizations, hospitals, clinics, dentists, opticians, nursing homes plus rehabilitation & retirement centers.

Tenet Healthcare Corporation THC – This is an investor-owned health care services company, which owns and operates general hospitals and related health care facilities for urban and rural communities in numerous states. The stock has a Zacks Rank #2.

Real Estate

Shelter costs were up 3.3% in November, same as October. Investors should note that the domestic economy is on decent footing with a tightening labor market and higher consumer spending, thus brightening the prospects of the real estate sector. This is because buoyancy in the economy translates into greater demand for real estate, higher occupancy levels and a spurt in rent growth (read: Sector ETFs to Win After Robust October Jobs Data).

iShares U.S. Real Estate ETF IYR – The underlying Dow Jones U.S. Real Estate Index measures the performance of the real estate sector of the U.S. equity market.

RPT Realty RPT – The company operates as a real estate investment trust. It owns, develops, acquires, manages and leases regional malls, community shopping centers and single tenant properties. The stock has a Zacks Rank #2.

Transportation

Prices increases remained steady in the transportation sector. There was 0.8% uptick in November, the same as in October. 

iShares Transportation Average ETF IYT – The underlying Dow Jones Transportation Average Index measures the performance of companies from the Industrial Transportation, Airline and General Industrial Services industries of the U.S. equity market.

Kansas City Southern KSU – It is a transportation holding company that has railroad investments in the United States, Mexico and Panama. The stock has a Zacks Rank #2.

Consumer Staples

Food inflation was 2.0% in November, slightly down from 2.1% in October, helped by costs of food at home (1.0%, the same as in October).

Consumer Staples Select Sector SPDR Fund XLP – The underlying Consumer Staples Select Sector Index seeks to provide an effective representation of the consumer staples sector of the S&P 500 Index.With XLP investing 19.67% in food & staples retailing, 17.34% in food products and 25.25% in beverages, rising food inflation should benefit the fund read: Consumer Staples' ETFs Hitting New Highs).

Beyond Meat Inc. BYND – The Zacks Rank #2 food company manufactures, markets and sells plant-based meat products primarily in the United States and internationally.

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Kansas City Southern (KSU) : Free Stock Analysis Report
 
iShares U.S. Real Estate ETF (IYR): ETF Research Reports
 
Consumer Staples Select Sector SPDR Fund (XLP): ETF Research Reports
 
iShares U.S. Healthcare Providers ETF (IHF): ETF Research Reports
 
iShares U.S. Medical Devices ETF (IHI): ETF Research Reports
 
iShares Transportation Average ETF (IYT): ETF Research Reports
 
Tenet Healthcare Corporation (THC) : Free Stock Analysis Report
 
RPT Realty (RPT) : Free Stock Analysis Report
 
Apollo Endosurgery, Inc. (APEN) : Free Stock Analysis Report
 
Beyond Meat, Inc. (BYND) : Free Stock Analysis Report
 
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