DUAVF - The 7 Best Mid-Cap Stocks to Buy Right Now

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If you’re the type to defer inquiries about what to have for dinner, these market ideas for best mid-cap stocks to buy could be for you. In a world where social forces demand you pick sides — in this case, between growth and value — the middle of the road enables you the advantages of both.

First, it’s important to discuss definitions. While no hard and fast rules exist, the general consensus states that the best mid-cap stocks to buy align with publicly traded companies featuring a market capitalization between $2 billion and $10 billion. For the purposes of this article, most of the ideas below feature equity values just shy of $10 billion.

Second, let’s discuss the motivation to consider the best mid-cap stocks to buy. Primarily, midcaps provide balance, with the underlying companies operating in the middle of their growth curve. As well, some of these ideas tend to attract less attention, which is good during a deflationary spiral.

Ultimately, if you’re attempting to navigate public equities under these strange circumstances, consider the below best mid-cap stocks to buy.

Sasol (SSL)

Based in Sandton, South Africa, Sasol (NYSE:SSL) represents an integrated energy and chemical company. Per its website, Sasol features a chemicals and hydrocarbon energy business. In addition, the company features green and sustainable energy initiatives. At the time of writing, SSL stock features a market value of roughly $10 billion. On a year-to-date (YTD) basis, SSL stock is up about 2%.

Fundamentally, Sasol “enjoys” a cynical tailwind from the geopolitical flashpoint in eastern Europe. With Russia’s invasion of Ukraine sparking various economic sanctions, the latest escalation from Moscow includes shutting off critical energy outflows to Europe. Purely on Economics 101, lower supply of a vital product (even if artificially initiated) results in higher demand.

Effectively, Sasol enjoys inelastic demand, at least in terms of baseline consumption. Even with the extraordinary relevance that the company provides, Gurufocus.com considers SSL modestly undervalued. Primarily, its profitability margins run superior to the industry median levels. Therefore, Sasol is a strong bet for best mid-cap stocks to buy now.

Magellan Midstream Partners (MMP)

As with Sasol, Magellan Midstream Partners (NYSE:MMP) benefits broadly from the new energy paradigm. The key difference is that, per its name, Magellan focuses on the midstream component of the hydrocarbon industry. This component ties in with infrastructural concerns such as storage and transportation.

At the time of writing, MMP stock features a market capitalization of $9.87 billion. On a YTD basis, shares have gained nearly 2%.

On fundamental grounds, Magellan again represents a downwind beneficiary of Russia’s military belligerence. Not only did the Kremlin’s action to penalize western nations through energy outflow cuts reduce overall global supply availability, signs suggest that the conflict in Ukraine will last longer than previously anticipated. These signs include partial military mobilization and dubious annexations.

Like Sasol above, Gurufocus.com labels MMP modestly undervalued. Highlights include decent longer-term growth trends and robust profitability metrics relative to the industry. Still, do keep in mind that Magellan structures itself as a master limited partnership, thus requiring K-1 filings. In my opinion, MMP remains one of the best mid-cap stocks to buy for its resilience and relevant fundamentals.

BJ’s Wholesale Club (BJ)

A membership-only warehouse club chain, BJ’s Wholesale Club (NYSE:BJ) offers consumers a practical mechanism to fight inflation. Through bulk purchases, consumers can load up on products today before the dollar becomes worth less tomorrow. On Sept. 30’s closing bell, BJ actually gained nearly 11% YTD. Presently, the underlying retailer features a market cap of $9.9 billion.

Looking at the fundamentals, BJ’s benefits from its wholesale low-prices business model. True, consumers impacted by inflationary forces will certainly limit purchases of goods and services whenever possible. However, some products must be acquired no matter what (i.e., food and water). Therefore, BJ’s features for the essentials inelastic demand.

To be fair, Gurufocus.com labels BJ as significantly overvalued. Mathematically, this may be the case because while BJ’s enjoys solid profitability metrics, investors are paying more for that profitability. However, context matters. With myriad economic ambiguities present, BJ’s longer-term positive growth trajectory offers encouragement. Therefore, it’s one of the best mid-cap stocks to buy.

Crown Holdings (CCK)

Billed as a leading supplier of beverage, food and other product-category packaging, Crown Holdings (NYSE:CCK) essentially ties itself into infrastructural undercurrents. Unfortunately, Wall Street, for now, doesn’t see much value in this proposition. Since the start of this year, CCK slipped below parity to the tune of 25%. Presently, it features a market cap of $9.82 billion.

Although it’s not currently getting the love that it arguably deserves, analysts certainly refuse to ignore CCK. According to TipRanks, Crown Holdings features a consensus strong buy rating. That’s from 15 analysts, 12 of whom rate CCK bullishly, while only three give it a hold rating. Moreover, the experts peg a target price of $120.64. That’s up 48.8% from the time-of-writing price, making CCK one of the best mid-cap stocks to buy.

For its part, Gurufocus.com labels CCK as a possible value trap. As with other names among the best mid-cap stocks to buy, context matters. Naturally, the recent volatility in the major indices doesn’t help. However, core product packaging represents an indelible business.

Dassault Aviation (DUAVF)

A French manufacturer of military aircraft and business jets, Dassault Aviation (OTCMKTS:DUAVF) might not be a household name among most American investors. However, the company arguably received a relevance boost because of the new geopolitical paradigm in Europe. Since the January opener, DUAVF stock stands roughly 3% above parity. It features a market cap of 9.84 billion euro (approximately $9.65 billion).

Fundamentally, Dassault benefits cynically from Russia’s invasion of Ukraine. While Dassault may not be the top defense contractor of the conflict, Moscow’s decision will almost surely bear permanent or at least longstanding consequences. Effectively, few, if any, Western European nations will trust Russia unless the country offers true penitence. Even then, bitter relations may last centuries. Like it or not, conflict breeds relevance for defense contractors.

For the moment, Gurufocus.com labels Dassault fairly valued. However, I consider it one of the best mid-cap stocks to buy because its relevance will likely increase. And relevance does not mathematically register in financial calculations. Bold contrarians can use this dynamic to their advantage.

Signature Bank (SBNY)

Based in New York, Signature Bank (NASDAQ:SBNY) is full-service commercial bank with 38 private client offices throughout New York, Connecticut, California and North Carolina. Since the year started, SBNY stock hemorrhaged nearly 54% of market value. As a result, Signature cleanly qualified as one of the best mid-cap stocks to buy.

Of course, backing into the underlying category may not be the best form of introduction. Admittedly, the wild gyrations of monetary policy — first dovishness and now hawkish strategies — left financial firms reeling. At the same time, the severe challenges of the moment allow companies like Signature Bank to step up.

Anyone can guide clients in an inflationary market where assets sometimes rise “just because.” It takes true expertise to guide clients in a deflationary market.

Notably, Gurufocus.com labels SBNY significantly undervalued. To be clear, SBNY presents risk because of the Federal Reserve’s hawkish pivot. However, it’s encouraging that Signature Bank features excellent three-year growth run rates and solid profitability margins relative to the industry. Therefore, contrarians may want to give it a chance as one of the best mid-cap stocks to buy.

Celanese (CE)

Based in Irving, Texas, Celanese (NYSE:CE) is a technology and specialty materials firm. To be fair, the global economic turmoil stemming from issues such as inflation and supply-chain disruptions from the crisis in Ukraine hurt various industries. In turn, this pain filtered down to Celanese, impacting its addressable market.

Since the start of this year, CE stock has fallen badly to the tune of 46%. In the trailing month, shares slipped 12%. Because of the crimson ink, Celanese features a market cap presently of $10 billion.

Nevertheless, risk-taking contrarians may want to put CE on their radar for best mid-cap stocks to buy. It comes down to forward relevance. Celanese’s specialty materials affect almost everything, from innovations such as 5G and electric mobility to the mundane such as lighting equipment and filtration solutions. In other words, unless you see a nuclear apocalypse in our future, Celanese offers a strong discount.

On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

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