These inflation-fighting stocks are expanding margins in this tough environment

Published Tue, Apr 12 202211:45 AM EDT

Inflation has hit levels not seen since 1981, and that means investors will be searching for the shares of companies that can handle surging prices. The March consumer price index report released Tuesday showed another record increase in inflation, with headline inflation rising to its highest level in more than 40 years. Those higher prices could continue to affect company profits throughout the year. However, there are still good opportunities for investors trying to navigate this inflationary environment. CNBC Pro compiled a list of companies that have pricing power and are expected to grow profits this year, using data from FactSet. We first screened for stocks that expanded margins in the last year by at least 10%. We then narrowed it down to companies estimated to grow their earnings per share by at least 10% during the year. Each name on the list has a buy rating from at least 60% of their respective analysts. We excluded energy-related companies from the screen because their current margins are inflated by the latest spike in oil prices and are not sustainable. Here are the 10 companies with pricing power to fight inflation: Chipmaker Micron Technology saw the biggest margin expansion over the past year, having grown it by 79%. It's expected to grow its earnings per share this year by about 59%. The semiconductor company also has the highest amount of analyst buy ratings on our list. Other chipmakers on the list, Broadcom and Microchip Technology , have the highest margins on the list. Disney's earnings projections for the year are one of the highest of our screening, behind SBA Communications , a real estate investment trust that operates wireless infrastructure in the U.S. Disney 's per-share earnings are expected to increase almost 95% this year. Earlier in 2022, the company announced its first major ticket price adjustment , raising costs for multiple-day guest visits to Disney World. Among industrials, Raytheon and Jacobs Engineering made the list, having shown margin expansion over the past year of 50% and 25%, respectively. Both stocks are expected to grow per-share earnings by about 12% this year. IQVIA , D.R. Horton and NextEra Energy are also on the list.

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Inflation has hit levels not seen since 1981, and that means investors will be searching for the shares of companies that can handle surging prices.