In this environment, investors need to be very granular in their approach to the stock market, according to investor Jenny Harrington. The S & P 500 is down about 17% so far this year, yet there are some sectors that are still doing well, she said. “Everything in this market right now is moving asynchronously,” Harrington said in an interview during the CNBC Financial Advisor Summit on Tuesday. While she is a dividend investor, she is also looking for value in this current market. “We are looking for stocks that are trading at a lower price today than we think they are actually worth today and in the future,” said Harrington, CEO of Gilman Hill Asset Management. For instance, she recently bought shares of Kohl’s , which is down about 43% so far this year — but up about 13% from its 52-week low on Sept. 30. “The share price has, I think, already discounted an incredibly weak consumer, trading at 10 times earnings,” Harrington said. “Once you talk to the company what you hear is, ‘Hey, we actually have had enormous headwinds for the last year in terms of supply chain issues and inventory issues.’ Those will be gone for next year. So those will actually become tail winds in next year earnings versus 2022 earnings.” She added Kohl’s shares to replace American Eagle Outfitters , which she bought for around $14 a share back in May for the same reason — it had “already corrected for a consumer that was basically going to lay down and die and never spend again,” she said. However, since the company suspended its dividend , she had to sell it. However, her thesis still proved true, Harrington said. The stock is up about 15% from her purchase price but is still down about 39% year to date. She also sees opportunity in certain consumer staples names. While some, like Procter & Gamble and General Mills , are overvalued and too expensive because of investors’ flight to safety, others are still undervalued, she said. That includes B & G Foods and Unilever , Harrington said. “They still … offer great value because I think they are trading at a discount to where their future cash flows should imply that the share price should be or the money I make off the dividend income from them,” she said.
