2015. PROMISING STOCKS

The stock market has become such a complex puzzle to many investors that a good portion of them are sitting on the sidelines. There’s nothing wrong with this strategy. While you will miss significant gains if the market continues its relentless ascent, there is a great fear about what will happen when the Federal Reserve begins raising rates.

It’s widely believed that the Fed will raise rates slowly so it doesnt spook the market. Will this be an effective approach? Nobody knows for sure. And its still possible that the Fed backs off and doesnt raise rates at all this year. Then you have to look at the staying-in-cash angle. If we see deflation at some point over the next few years (a sell-off in commodities might be hinting at this possibility due to reduced global demand), then cash is a good place to be when prices for goods and services decline, the value of your dollar increases. (For related reading, see:

Confused yet? Thats the point. And even if youre not confused, you have to recognize that this could be the most complex stock market environment in history. That being the case, ignore it. That’s right. Instead of paying attention to all the noise, invest in top-tier companies. Even if those companies suffer due to a broad market decline, you can simply buy more stock. This will be a lot easier if youre wise enough not to buy in bulk. (For related reading, see:

So what are top-tier companies?

Southwest Airlines Co. (LUV )

Investors love LUV. With oil plummeting, the airlines are a good place to be. And with global demand waning, oil prices are more likely to fall further than rebound. The big risk here and one that nobody seems to talk about is that if global demand is waning, then business and leisure travel will decline. Therefore, this shouldnt be looked at as a set-it-and-forget-it investment. For now, all is well, but keep an eye on LUV if you choose to invest, and consider setting a trailing stop for at least some protection (this wont protect you on a gap-down ). (For related reading, see: Manage Risk with Trailing Stops and Protective Put Options .)

The one thing that gives Southwest Airlines a more bullish than bearish edge is cash-flow generation. For instance, it generated $2.90 billion in operation cash flow over the past year. And it recently announced a 6% increase in the dividend as well as a $5 billion share buyback program.

The Hain Celestial Group, Inc. (HAIN )

Natural and organic food is on fire. That has been the case for years, and the trend is highly likely to continue. In the companys second quarter, net sales jumped 30.2% and adjusted earnings per diluted share increased 26% year over year. That represents 17 consecutive quarters of year-over-year double-digit sales and adjusted earnings growth. For FY2015, Hain expects net sales growth of 23% and EPS to improve between 17% and 19%. The one negative here is a strong dollar negatively impacting overseas operations. (For related reading, see: How to Ride the Organic & Natural Products Wave .)

Hain Celestial is in the right place at the right time. And while its not a likely scenario, it cant be ruled out as an acquisition target.

Chipotle Mexican Grill, Inc. (CMG )

For those of you have read my articles in the past, I have been bullish on Chipotle for many years. Its currently trading at 47 times earnings, but its also still delivering double-digit top- and bottom-line growth. Additionally, it has $789.61 million in cash and no long-term debt. Thats to go along with $689.82 million in operational cash flow generation over the past year. This favorable capital position is important because it will not only allow Chipotle to grow its namesake brand, but other brands as well, including ShopHouse Southeast Asian Kitchen. (For a look back, see: Chipotle Executing Well, But Valuation Leaves No Margin for Error .)

Chipotle is a great company, and its likely to be a long-term winner, but the risk/reward might not be as favorable as it was in recent years. And the stock isnt as resilient as some others on this list.

Dominion Resources, Inc. (D )

If you want resiliency to market swoons, then you wont find many better options than Dominion Resources, otherwise known on the street as The Letter D. This stellar utility company beat by a penny on the bottom line in the fourth quarter while raising its dividend 8%. It currently yields 3.60%. But whats most important is that Dominion Resources like many utilities is a little-worry investment. The stock should hold up well in any environment while you collect generous dividends. (For related reading, see: Are There Leveraged ETFs that Track the Utility Sector? )

The Kroger Co. (KR )

Say the word Kroger to someone not involved with investing (and who doesn’t live near a Kroger) and they might ask you if its a type of tiger from India.

Supermarket chain Kroger has been, and remains, one of the most underrated companies on the planet. It consistently delivers on the top and bottom line (annually), it generates excellent cash flow ($3.93 billion OCF over past year), and out of 21 analysts, not one has a sell rating on it. It also offers a small yield. But whats most impressive is brand power. You might be shaking your head because not many people are familiar with the name, but consider some of the brands Kroger owns: Kroger, City Market, Dillons, Food 4 Less, Fred Meyer, Fry’s, Harris Teeter, Jay C, Ralphs, and Smith’s. Thats just a small sampling. Kroger operates under two dozen banners. Booming economy or economy in the gutter, people are going to buy food. (For related reading, see: Kroger Leverages its Strength to Get Even Stronger .)

The Bottom Line

There are a few more speculative, high-risk/high-reward names on my list, but theres not enough room here. Perhaps in the near future. For now, consider digging into SEC filings for the five companies above. Thats a great place to start your research. (For related reading, see: U.S. Stocks are Still the Place to Be in 2015 .)

Dan Moskowitz does not have any positions in LUV, HAIN, CMG, D, or KR.