by Mark Butler

Created on: December 21, 2011   Last Updated: December 23, 2011

With the Federal Reserve Board’s estimate that the economy will continue its slow recovery throughout 2012 many investors are looking for relatively safe places to invest. While U.S. government bonds are considered among the safest of investments, their current rate of return make them less than ideal.

Bonds of other countries, notably the European countries may have a higher rate of return but given the uncertain nature of the Euro at the beginning of the year it is understandable if investors look at Euro-bonds with wariness. For those who are risk averse but desire to see better than average rates of return on investments, the U.S stock markets remain the investment vehicle of choice for those able to invest.

When selecting stocks to buy for 2012 it is essential to look for three factors.  These factors are growth potential, safety and dividends. In the case of growth, while the company’s ability to grow in market share is certainly important, also important is the potential for the stock price to grow in value over time. When it comes to safety, it is best to see if the management team is stable, doesn’t have an excessive salary for the CEO and has a history of making the right moves and has an ability to weather an uncertain economic future as measured by past performance.  Lastly, look for a company that pays dividends and has done so over time with a strong history of increasing dividends on a very regular basis. 

Companies worthy of investing in for 2012 include Johnson Controls (JCI), Abbott Laboratories (ABT) and Bristol-Meyers Squibb (BMY).

Johnson Controls is narrowly focused conglomerate in the business of providing automotive interiors, automotive batteries, products and services designed to maximize energy efficiency. Its automotive interior business is well established making it a Tier One provider to the automotive industry which allows the investor to take advantage of growth in the automotive industry segment. Its battery division includes batteries for hybrid automobiles and Johnson Controls recently (September 2011) acquired a Li-ion battery business that it had previously been engaged in with Saft Group.

The building controls division includes an extensive inventory of commercial, educational and government building control and security contracts along with the necessary industrial production facilities to supply their needs and to market equipment worldwide. While the dividend yield (2.5%) is a little

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