This year has been challenging for investors and businesses as they have been punished by high inflation and aggressive interest rate hikes by the Fed. However, the recently released favorable macroeconomic data could lead to a year-end “Santa Claus rally” for the market.

The consumer price index rose 0.1% from the previous month and 7.1% from a year ago in November, lower than estimates. Corporate economist with Navy Federal Credit Union, Robert Frick, believes that cooling inflation will boost the markets and take pressure off the Fed to raise interest rates at an accelerated pace.

Amid this backdrop, quality stocks Pfizer Inc. (PFE), Murphy USA Inc. (MUSA), and Berry Corporation (BRY) could be solid investments to benefit from their potential rally.

Pfizer Inc. (PFE)

PFE discovers, develops, manufactures, markets, distributes, and sells biopharmaceutical products worldwide. It offers medicines and vaccines in various therapeutic areas, including cardiovascular metabolic and women's health, biosimilars, sterile injectable and anti-infective medicines, and oral COVID-19 treatment.

Over the last three years, PFE’s dividend payouts have grown at a 5.5% CAGR. Its four-year average dividend yield is 3.63%, and its forward annual dividend of $1.64 per share translates to a 3.09% yield. It is expected to pay a quarterly dividend of $0.41 per share on March 3, 2023.

On December 6, 2022, PFE and Clear Creek Bio, Inc. announced a research collaboration and exclusive license agreement to advance the discovery and development of potential inhibitors of the SARS-CoV-2 papain-like protease.

PFE’s Chief Scientific Officer, Anti-Infectives, and Head of Medicine Design, Charlotte Allerton, believes in continuing to advance clinical development opportunities for PFE’s current oral therapy as well as innovating through its internal programs and strategic partnerships to try to stay ahead of the COVID-19 virus.

For the fiscal third quarter ended October 2, 2022, PFE’s total assets increased 7.6% to $195.35 billion, compared to $181.48 billion for the fiscal year ended December 31, 2021. The company’s adjusted net income increased 39.7% year-over-year to $10.17 billion. Its non-GAAP EPS came in at $1.78, representing a 40.2% increase from the prior-year quarter.

PFE’s revenue for the quarter ending December 31, 2022, is expected to increase 2.2% year-over-year to $24.36 billion, respectively. Its EPS for fiscal 2022 is expected to increase 46.5% year-over-year to $6.48. It has an impressive earnings surprise history, surpassing its consensus EPS estimates in each of the trailing four quarters. The stock has gained 11.5% over the past month to close the last trading session at $53.07.

PFE’s POWR Ratings reflect its strong fundamentals. The stock has an overall rating of A, equating to a Strong Buy in our proprietary rating system. The POWR Ratings assess stocks by 118 different factors, each with its own weighting.

Within the Medical - Pharmaceuticals industry, it is ranked #3 out of 160 stocks. The company has an A grade for Value and a B for Growth, Sentiment, and Quality. Click here to see the additional POWR Ratings of PFE for Momentum and Stability.

Murphy USA Inc. (MUSA)

MUSA engages in the marketing of retail motor fuel products and convenience merchandise. The company operates retail stores under the Murphy USA, Murphy Express, and QuickChek brands.

MUSA’s four-year average dividend yield is 0.24%, and its forward annual dividend of $1.40 per share translates to a 0.50% yield. It paid a quarterly dividend of $0.35 per share on December 1, 2022.

MUSA’s total operating revenues increased 34.7% year-over-year to $6.19 billion for the third quarter ended September 30, 2022. The company’s net income increased 111.1% year-over-year to $219.50 million. Its adjusted EBITDA increased 72.7% year-over-year to $367.00 million. In addition, its EPS came in at $9.28, representing a 133.2% increase from the prior-year quarter.

MUSA’s EPS and revenue for the quarter ending December 31, 2022, are expected to increase 15.1% and 21% year-over-year to $4.88 and $5.77 billion, respectively. The company has a commendable earnings surprise history, surpassing the consensus EPS estimates in each of the trailing four quarters. The stock has gained 41.6% year-to-date to close the last trading session at $282.06.

It is no surprise that MUSA has an overall rating of B, which translates to a Buy in our proprietary rating system.

Within the Specialty Retailers industry, it is ranked #2 out of 47 stocks. The company has a B grade for Growth, Value, and Quality.

Click here to see the additional ratings of MUSA for Momentum, Stability, and Sentiment.

Berry Corporation (BRY)

BRY, an independent upstream energy company, develops and produces conventional oil reserves in the western United States. It operates in two segments, Development and Production and Well Servicing and Abandonment.

BRY’s four-year average dividend yield is 5.81%, and its forward annual dividend of $0.24 per share translates to a 3.07% yield. It paid a quarterly dividend of $0.06 per share on November 28, 2022.

BRY’s total revenues for the fiscal third quarter ended September 30, 2022, increased 162.5% year-over-year to $376.45 million. Its adjusted net income increased 294.5% year-over-year to $45.52 million. Its adjusted EBITDA increased 63.5% year-over-year to $96.98 million. In addition, its adjusted EPS came in at $0.55, representing a 292.9% increase from the prior-year quarter.

Analysts expect BRY’s EPS for the quarter ending December 31, 2022, to increase 152.1% year-over-year to $0.30. Its revenue for the quarter ending March 31, 2023, is expected to increase 107.1% year-over-year to $194.87 million.

It has a commendable earnings surprise history, surpassing the consensus EPS estimates in three of the trailing four quarters. The stock has gained 4.7% year-to-date to close the last trading session at $7.83.

BRY’s strong fundamentals are reflected in its POWR Ratings. It has an overall rating of A, which translates to a Strong Buy in our proprietary rating system. Within the B-rated Energy - Oil & Gas industry, it is ranked #2 out of 91 stocks. The company has an A grade for Value and Momentum and a B for Growth and Sentiment.

Click here to see the POWR Ratings of BRY for Stability and Quality.

PFE shares were trading at $54.77 per share on Wednesday afternoon, up $1.70 (+3.20%). Year-to-date, PFE has declined -4.24%, versus a -13.75% rise in the benchmark S&P 500 index during the same period.

Malaika's passion for writing and interest in financial markets led her to pursue a career in investment research. With a degree in Economics and Psychology, she intends to assist investors in making informed investment decisions.

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