3 Resilient Stocks to Capitalize on Market Volatility and Earnings Momentum

As markets oscillate between optimism and caution, investors are seeking companies that blend defensive characteristics with growth catalysts. Philip Morris International (PM), Cardinal Health (CAH), and Alphabet (GOOGL) stand out as pillars of resilience, offering compelling valuations, dividend strength, and technical momentum. These stocks are primed to thrive amid volatility, driven by sector leadership, earnings surprises, and undervalued growth potential.

1. Philip Morris International (PM): Smoking Out Volatility with Smoke-Free Growth

Philip Morris is transforming from a cigarette giant into a leader in nicotine alternatives, a shift reflected in its Q2 2025 results. Smoke-free products now account for 42% of net revenues, with IQOS and ZYN nicotine pouches driving 20%+ organic growth. The company's $1.35 quarterly dividend (yielding ~3.0% at recent prices) offers stability, while its valuation remains attractive.

Valuation Edge:
PM's P/E of 23.55 (vs. a 5-year average of 25.8) suggests it's neither overbought nor undervalued, but its margin expansion and $7.36–7.49 EPS guidance for 2025 justify optimism.

Technical Momentum:
The stock hit a record high of $178.80 in late May, with the 10-day moving average breaking above the 50-day line—a bullish signal. Analysts at Bank of America and Jefferies recently raised price targets to $190+, citing smoke-free adoption in emerging markets like Pakistan and South Africa.

Why Now?
PM's “smoke-free first” strategy is insulating it from regulatory headwinds, while dividends provide a cushion against market dips.

2. Cardinal Health (CAH): Healthcare Resilience in a Turbulent Sector

Cardinal Health's Q2 results underscored its ability to navigate headwinds. Despite a 4% revenue decline due to a large customer contract expiration, segment-specific wins—like a 17% surge in Pharmaceutical Solutions (excluding the contract loss)—drove a 2% rise in non-GAAP EPS to $1.93. The $0.5056 quarterly dividend (yielding 1.6%) reinforces its reliability.

Valuation Strength:
At a P/E of 23.55, CAH trades below its 5-year average of 29.5. The acquisition of GI Alliance and its $7.85–8.00 2025 EPS guidance signal a rebound.

Technical Setup:
The stock has formed a bullish ascending triangle pattern, with resistance at $130 now broken. A close above $135 could unlock upside to $150, targeting its pre-2020 highs.

Why Now?
CAH's pivot to high-margin segments like oncology and nuclear health solutions positions it to outperform as healthcare spending stabilizes.

3. Alphabet (GOOGL): Undervalued Tech Titan Amid AI Disruption

Alphabet's Q1 beat—$2.81 EPS vs. $2.02 estimates—highlighted its ability to grow even as it invests heavily in AI. Despite Q2 guidance projecting a 23% EPS drop (to $2.16), Google Cloud's 10% revenue contribution and $2.17B operating income signal long-term promise. The $0.20 quarterly dividend (yielding 0.2%) may expand as cash flows stabilize.

Valuation Misunderstood:
At a P/E of 28.4, GOOGL trades at a discount to its 5-year average of 35. Its $1.94T market cap is the largest in the tech sector, yet its AI investments (like Gemini and Vertex) are underpriced.

Technical Catalysts:
The stock's MACD turned positive on May 12, and its 10-day moving average crossed above the 50-day line—a bullish crossover. Analysts at BMO and Morgan Stanley see $180–$190 targets, up 20% from current levels.

Why Now?
Alphabet's cloud and AI assets are undervalued relative to competitors. Even short-term volatility could create buying opportunities.

Final Analysis: A Portfolio of Resilience and Growth

These stocks share a common thread: they're profitable, dividend-friendly, and technically positioned for upside. PM and CAH offer income and stability, while Alphabet represents a leveraged bet on tech's future. With analyst upgrades and strong fundamentals, they're ideal for investors seeking both safety and asymmetric returns.

Action Items:
1. Buy PM near $175–$180, targeting $190+ with a stop below $165.
2. Add CAH at $125–$130, aiming for $150 with a stop below $120.
3. Dip into GOOGL on pullbacks below $150, with a $190 horizon.

In a volatile market, these three stocks are not just survivors—they're leaders.

Data as of May 26, 2025. Past performance is not indicative of future results.