All Entries in the "Investment Advice | Top Stock Picks | Forex (FX) | Exchange Traded Funds (ETFs)" Category
There’s one market-timing indicator that beats all others – stupidity. One thing I’ve learned is that you can always bet on the crowd to do the WRONG thing with their money. It’s spooky. Every time a big enough group of people believes the same thing, it turns out to be a load of bullshit. Dot-com stocks . . . the YRK bug . . . the housing bubble. Put simply, crowds are dumb. You can make them do just about anything and follow all sorts of stupid advice.
That’s why being a contrarian investor is so important. A true contrarian sells hysteria and buys despair. History clearly shows this is the one of the only proven ways to make money over the long haul. When prices are high there’s a self-correcting mechanism and when prices are low there’s a self-correcting mechanism. Investors’ perceptions of the future are shaped by their immediate past and they tend to chase high-priced, popular sectors that are set for collapse and they tend to avoid low-priced sectors that are set to soar. Just buying into a sector because it’s unpopular isn’t necessarily a good idea, however. An astute contrarian invests in an unpopular sector that will become popular again.
“You’re either a contrarian or a victim. The choice is yours.” says legendary resources investor, Rick Rule.
Most investors are lazy and choose the easier, less informative method of watching only the stock price– but understanding the price is absolutely useless information if you don’t know what it’s worth. P/E ratios are a good place to start. One simple way to invest like a true contrarian is to keep an eye on sentiment. Sentiment tells you what the crowd is thinking. There are two main types of sentiment indicators. Both are useful signals as to whether investors have become over optimistic…or over pessimistic.
1. The Short Ratio – tells how many investors are short a stock or/and an entire market. That’s how many investors are betting a stock or a market will fall in price (calculated by dividing the short interest by average daily trading volume.) An unusually low short ratio is often a sign of complacency and a signal to sell. An unusually high ratio is a signal to buy.
2. Investor Surveys – a number of surveys record the bullish vs. bearish percentage of investors. One isInvestors Intelligence which tells you what percentage of investment advisors are bullish and what percentage are bearish. Another useful measure from Hulbert’s Financial Digest tracks the sentiment of newsletter editors. When newsletter editors are at bullish extremes, it’s time to sell. When they’re at bearish extremes it’s time to buy.
Successful contrarian investors need to do the hard leg work and homework on their investments — and watch the market sentiment.
Everyone make sure to tune into ABC tomorrow night at 8:00 PM to watch a new episode of their hit show, Shark Tank. For those of you who’ve never see the show, your missing out. Shark Tank is where five successful entrepreneurs fight over promising startups, and ruthlessly chew up the unprepared or those who aren’t business minded. Anyone who is interested in the world of business, venture capital, or money will love this show. It provides a wealth of knowledge about what venture capitalists need to hear before they invest in your company. Plus the fighting between the sharks alone is as great as entertainment can come. The key to being successful when you come into the shark tank is as easy as three steps:
- Have a great idea that either makes money or has potential to.
- Be prepared, from top to bottom know the in’s and out’s of your business and have everything to present to wow the sharks. Being unprepared, stuttering, or having any mix-ups will get you eaten alive through harsh criticism and ruthless comments and leave you empty handed.
- Have the X-Factor, something to wow the Sharks and get them opening their checkbooks to get a part of your business. If you nail the presentation and wow the Sharks your financial worries will be all over as you’ll have every Shark their willing to not only give you and your business the money needed to grow and expand but they will provide you with the necessary resources and contacts to take your business to the next level.
Like the business world, things can get quite ruthless in the Shark Tank and there is no holding back. It’s what makes the show such a hit and so entertaining the constant battling not only between the entrepreneurs and the sharks but the sharks themselves. Before we get into the many great business lessons you can learn from the show we first have to let you in on who the five sharks are that you will be presenting to, ranked from net-worth:
Mark Cuban, Net Worth $2.3 Billion: You might all know Mark Cuban as the flamboyant, outspoken owner of the Dallas Mavericks. You see all these great qualities in full effect during Shark Tank where Cuban constantly battles Kevin O’Leary as the most critical and harsh of the all Sharks. Cuban started out his career by launching a company, MicroSolutions, which was a system integrator and software reseller. He sold it to H&R Block for $6 million and used this seed capital to launch his next venture, Broadcast.com an online sports webcasting company. He capitalized by selling Broadcast during the dot come boom to Yahoo for $5.9 billion. Since then along with running the Dallas Mavericks and being a prominent figure on Shark Tank, Cuban runs his own investment company and has become a rather outspoken, popular media mogul.
Kevin O’Leary, Net Worth $300 Million: Kevin like Cuban is by far one of the most entertaining of the bunch. It’s because his ruthless behavior and no limits deliver great punch lines, sometimes they can be quite mean, as he doesn’t hold back. While some people might be offended others find it hysterical as if you like Simon Cowell from American Idol and the X-Factor and his harsh criticism then you will love Kevin, as it’s hard to imagine but he’s even more ruthless than Simon. The guy only cares about one thing and that’s making money. If you have a great idea then he’ll be your best friend but if you stutter or goof up at all during your presentation be ready for his ruthless comments. O’Leary has had a successful business career making the majority of his wealth by creating an education software program that he sold to Mattel for $3.8 billion. Since then along with his duties on Shark Tank and being a venture capitalist he runs O’Leary Funds, a mutual fund company that targets buy and hold investors.
Robert Herjavec, Net Worth $100 Million: Robert is the kindest of all the male Sharks however he can dish out criticism from time to time. A software guy himself he founded an Internet security company that he later sold to Nokia for $225 million. He currently is CEO of Herjacveck Group, a security software program he founded in 2003 along with being a venture capitalist through his Shark Tank duties.
Daymond John, Net Worth $100 Million: The original founder of the popular clothing line, FUBU. John is a true story of rags to riches as he use to sew and make his clothes himself in his mothers basement making $800 a day until he and his mother mortgaged their house for $100,000 to generate startup capital. Well this great risk paid off, as FUBU has become a prominent global clothing brand that at its peak has generated over $400 million in revenue in a single year. Along with being current CEO & President of Fubu, John is an active venture capitalist, which is why he has been a great addition to the show. While critical he is very articulate and educated when it comes to giving advice and voicing his opinion.
Barbara Corcoran, Net Worth $50 Million: Barbara is a real estate mogul and has been doing it for quite some time. She originally founded her company, The Corcoran Group, in 1973 with the help of her wealthy boyfriend, who fronted her the original loan. After having a successful career she sold her company for $66 million in 2003 and now along with being an investor on Shark Tank she has become a motivational speaker, author, and popular television personality. Considered the nicest of the bunch also being the only woman, Barbara often sides with female entrepreneurs and gangs up against the men calling them ruthless pigs. However don’t let her pretty face fool you, she can get down and dirty and be just as ruthless as the boys at times.
So now you know who the Sharks are make sure to tune into ABC every Friday at 8:00 PM to watch the show!
Becoming a success investor is not rocket science but it does take some intelligence along with setting out a plan of action. Below are Five of Stocks on Wall Street’s Rules to Becoming a Successful Investor:
1. Invest without emotions. Use your head not your heart. Emotions get in the way of logic, make a plan that will let you be accountable and disciplined. Don’t get overcomplicated with your plan either. It can be a simple trading strategy with simple rules. Like Warren Buffet always has said, “you don’t need to be a genius to make good money investing.”
2. Don’t set your expectations too high, be realistic. Don’t expect to make $1,000 off a $2,500 investment in six months time. While it is always doable, don’t count on it. Set realistic expectations and then be happy when you exceed them.
3. Don’t think a trade is always going to recover; sometimes it’s the smarter move to take a small loss now instead of taking a large loss later.
4. Don’t always think a good company is going to make you good money. You make money from the company’s performance. Sometimes good companies will struggle and the stock can go down whereas sometimes-bad companies stocks will soar.
5. End of day do your own research and be comfortable with the trade before you make it. Don’t make a trade solely on what someone else says, do your own analysis and if you agree with their investment idea then be confident and make the trade.
We are always hear to help you with any of your investment questions or needs. Two programs we now offer are Free Portfolio Reviews where we will overlook your investments, let you know what we think about each position, inform you on whether or not you have a balanced portfolio, & give you a detailed report on our findings.
Also if you don’t invest at all we do comprehensive Free Brokerage Account Setup’s where we will get you setup with the right brokerage account that fits your personal financial needs along with giving you an investment plan to help you reach financial freedom.
If anyone ever tells you that over time investing in the stock market is not a wise decision, just show them this chart below!
Long-term investing has always been the catalyst to building great wealth. You ever wonder why the rich have so much money? It’s because they have strategic investments that over time are always earning them income.
You will never become wealthy by just earning your salary, an equity position is necessary to become wealthy.
Take note as it doesn’t matter what age you are, you’re never too old or too young to start investing. If you haven’t started investing yet please contact us, we’ll be happy to get you setup and on a plan for financial freedom. Remember everyday you wait is costing you potential future earnings. In the meantime, just look at that chart below and realize that the stock market is a boom and bust industry and over time it’s historically always gone up.
Thanks to Merrill Lynch we have a chart showcasing the Dow Jones Industrial Average’s overall performance from 1900 up until the present.Please Follow Us on Facebook & Twitter & Don’t Be Shy To Leave a Comment Below!
What To Watch For This Week: International Markets Celebrating Holidays So The Focus Will Be On U.S. Earnings Led By McGraw-Hill, Cisco, & Michael Kors
Wall Street Investors will see earnings reports from the likes of American Financial (NYSE: AFG), Campbell Soup (NYSE: CPB), McGraw-Hill (NYSE: MHP), Michael Kors (NYSE: KORS), Goodyear Tire (NASDAQ: GT), Comcast (NASDAQ: CMCSA), Cisco (NASDAQ: CSCO), Zillow (NASDAQ: Z), Weight Watchers (NYSE: WTW), Cabela’s (NYSE: CAB), Pepsico (NYSE: PEP), Whole Foods (NASDAQ: WFM), Nielsen Holdings (NYSE: NLSN), and Goldcorp (NYSE: GG).
Monday is a rather lackluster day with nothing too exciting going on.
Tuesday we will see earnings from McGraw-Hill. In a typical quarter, the holding company generally wouldn’t attract much investor attention, however this isn’t a typical quarter. McGraw-Hill has become a hot stock over the past week, as it ‘s the parent company of the ratings agency Standard & Poor’s who is currently being sued by the Obama Administration.
That’s right, you heard correctly. Just last week, the Obama administration sued the S&P over its rating of CDOs and mortgage-backed securities, alleging that the fault ratings helped contribute to the worldwide financial crisis. The government is seeking close to $5 billion from McGraw Hill, a little less than one-third of the company’s market cap. Seems like a desperate measure for the government, who we all know is in such financial mess that they would look for any scapegoat or way collect more funds that they can waste. We don’t expect this lawsuit to hold up, if so it would cripple McGraw Hill.
Analysts recently upgraded their outlook on McGraw Hill to a Buy, holding a price target of $57 per share. Analysts are confident McGraw-Hill will report a strong quarter Tuesday, however they say that the market might not give them the credit they deserve. As for the lawsuit from the government, they claim it is totally politically motivated and claim the S&P has done nothing wrong, as ratings don’t predict bond prices. As a result, don’t be worried about the potential suit and focus more on the strong long-term prospects and outlook McGraw-Hill has going forward.
Tuesday will continue to be a busy day for another popular fashion designer and retailer, Michael Kors (NASDAQ: KORS). Analysts currently expect the company to post earnings per share of $0.41 on revenue of $540.30 million. Michael Kors has performed exceptionally well since their IPO in 2011 as shares are up well over 130%. In the last three months alone, shares are up over 13%. Michael Kors receives exceptional analysts coverage with all 13 analysts currently covering the stock issuing a Buy rating or higher. As a result analysts continue to be Bullish and have set out a price target of $71 per share. Going into earnings, KORS is a top pick as they are a leading retail growth story with high estimate achievability and strong growth prospects going forward.
Wednesday’s big earnings come from the networking giant, Cisco. Shares are up well over 25% the past three months. Analysts expect the company to report earnings per share figure of $0.48 on revenue of $12.06 billion.
67% of analysts covering Cisco have a Buy rating or higher. Analysts remain positive going forward and have issued at price target of $24 per share. We agree with their assessment and believe revenues will be right in line with management’s guidance. Also, we expect sequential growth in switching and routing. By geography, we expect to see relative strength from North America and potential for Europe to beat very low expectations.
Don’t expect much from the international markets this week. From the Chinese celebrating Chinese New New Year, to Brazil celebrating carnival many of the banks will be closed much this week. Chinese banks will be closed all five days, Japan will also be closed on Monday for Founder’s Day and Brazil’s stock exchange will be closed Monday through Thursday due to Carnival.
So as you can see the international markets will be rather quiet. As a result, expect earnings reports to dominate the markets and signal which direction they will go. We expect the markets to continue to trade on fundamentals, as the risks associated with Asia are limited due to the holiday. Europe could be a threat to the bull markets but we still believe earnings will b e a bigger factor.
Reports: China, Japan, Hong Kong, Singapore and Brazil Markets Closed
Earnings from: American Financial (NYSE: AFG), Nielsen Holdings (NYSE: NLSN), Lowes (NYSE: L)
Reports: China, Hong Kong and Brazil Markets Closed; U.S. Federal Budget Balance (Expected -$2B); South Korean Unemployment Rate (Prior 3%)
Earnings from: Coca-Cola (NYSE: KO), McGraw-Hill, Western Union (NYSE:WU), Level 3 Communications (NYSE: LVLT), Rackspace Hosting (NYSE: RAX), Michael Kors, Goodyear Tire
Reports: China, Hong Kong and Brazil Markets Closed; U.S. Core Retail Sales (Expected 0.1%); Japanese GDP (Expected 0.1%)
Earnings from: Comcast (NASDAQ: CMCSA), CenturyLink (NYSE: CTL), Dean Foods (NYSE: DF), Whole Foods (NASDAQ: WFM), Zillow, Lorillard (NYSE: LO)
Reports: China and Brazil Markets Closed; German GDP Expected (Expected -0.5%); Eurozone GDP (Expected -0.4%)
Earnings from: Cabela’s, Pepsico, Goldcorp, Alpha Natural Resources (NYSE: ANR), Molson Coors (NYSE: TAP)
Reports: Chinese Market Closed; U.K. Retail Sales (Expected 0.8% Year-over-Year); U.S. Industrial Production (Expected 0.2% Month-over-Month); U.S. University of Michigan Consumer Sentiment (Expected 74.8)
Earnings from: JM Smucker (NYSE: SJM), Campbell Soup (NYSE: CPB)
Even after a busy week capping off with a Ravens Super Bowl victory, earnings season continues to kick into full gear. Investors will receive earnings from major players like Visa (NYSE: V), Sprint (NYSE: S), Coca-Cola (NYSE: KO), Humana (NYSE: HUM) Baidu (NASDAQ: BIDU) Chipotle Mexican Grill (NYSE: CMG), Noble Energy (NYSE: NBL), Activision-Blizzard (NASDAQ: ATVI), AOL (NYSE: AOL), Zynga (NASDAQ: ZNGA), Kellogg (NYSE: K), Akamai Tech (NASDAQ: AKAM), and Expedia (NASDAQ: EXPE). Not to mention many other companies we failed to list.
Monday is none too exciting other than receiving earnings from the Chinese website giant, Baidu.
Zynga will report earnings on Tuesday. The social gaming company has struggled ever since they went public. ZNGA peaked at $15 following the IPO, but ever since shares have collapsed. On Friday, Zynga closed at $2.66 so you can see just how far shares have fallen. Of the 23 analysts currently covering Zynga, 78% have a HOLD rating on the stock. Some say ZNGA is a volatile risky bet that could pay off with enormous returns however we are skeptical and would remain cautious and avoid the stock altogether.
Wednesday’s big earnings come from Visa. Visa is up 10% over the past three months and shares closed at $158.56 on Friday. Analyst are high on Visa as 71% of the thirty-four analysts covering the stock hold a BUY Rating or higher. 45% of those analysts rate Visa as a STRONG BUY. As the U.S. debit market continues to strengthen along with overall global growth Visa shares should stabilize. We like Visa here; they are a strong company and a solid stock so expect them to report another strong quarter.
Thursday investors will see an earnings report from Coca-Cola. KO has failed to capitalize on the market’s recent rally as shares up less than 1% over the course of the past three months. Analysts are moderately Bullish about KO, with 62% of 18 analysts holding a BUY rating or higher and 33% of analysts rating Coca-Cola as a HOLD. The most famous investor, Warren Buffet is a huge supporter of KO and thinks it’s a great buy. If you’re one of those investors who follows Buffet’s investment strategy then buy it here. We think KO is a solid company overall and expect them to do just fine going forward. Thursday will also be a key day for the international markets The European Central Bank and the Bank of England will release their interest rate decisions.
Friday the big focus is on U.S. economic data, as we will be given with the new unemployment rate. It’s a busy week overall, hope everyone’s ready for the ride!
Reports: Australian Interest Rate Decision (Expected 3%)
Earnings from: Humana (NYSE: HUM), Life Tech (NASDAQ: LIFE), Baidu (NASDAQ: BIDU)
Reports: Eurozone Retail Sales (Expected -0.5%), U.S. ISM Non-manufacturing (Expected 55.1)
Earnings from: Chipotle Mexican Grill (NYSE: CMG), Computer Sciences (NYSE: CSC), Zynga, Kellogg (NYSE: K)
Reports: Unemployment Rate (Expected 5.5%)
Earnings from: Visa, Allstate (NYSE: ALL), Green Mountain Coffee (NASDAQ: GMCR)
Reports: Bank of England Interest Rate Decision (Expected 0.50%), ECB Interest Rate Decision (Expected 0.75%), U.S. Nonfarm Productivity (Expected -1.2%), U.S. Unit Labor Costs (Expected 2.9%)
Earnings from: Noble Energy (NYSE: NBL), Coinstar (NASDAQ: CSTR), Sprint, Cigna (NYSE: CI), Activision-Blizzard (NASDAQ: ATVI)
Reports: Chinese CPI (Expected 2.0% Year-over-Year), Canadian Unemployment Rate (Expected 7%), U.S. Trade Balance (Expected -$46B)
Earnings from: AOL (NYSE: AOL)
We’re heading into the last week of January and frankly it should be a busy and exciting one for investors. With several major companies set to report their earnings along with key economic data to be released it should pose as an interesting week.
Kicking off the week will be industrial machine maker Caterpillar (NYSE: CAT) and tech-giant Yahoo (NASDAQ: YHOO) who both are reporting earnings Monday. Caterpillar’s guidance should be directly correlated to the Chinese economy, something investors should note as the company is often seen as a proxy for China’s continued industrialization.
Reports: Durable Goods Orders (Expected 1.8% month-over-month), Pending Home Sales (Expected 0.3%), Dallas Fed (Prior 6.8)
Earnings from: Caterpillar (NYSE: CAT), VMWare (NYSE: VMW), Illumina (NASDAQ: ILMN), Yahoo (NASDAQ: YHOO)
Reports: Consumer Confidence (Expected 64)Tuesday both carmaker Ford (NYSE: F) and online retailer Amazon (NASDAQ: AMZN) report. Estimates for Ford are around $0.26 while the stock has rallied significantly the past three months, up more than 30%.
Earnings from: Eli Lilly (NYSE: LLY), AK Steel (NYSE: AKS), Nucor (NYSE: NUE), DR Horton (NYSE: DHI), Ford (NYSE: F), Amazon (NASDAQ: AMZN), International Paper (NYSE: IP), Tupperware (NYSE: TUP)
Wednesday Skyworks Solutions (NASDAQ: SWKS), a handset chip supplier reports. Skyworks has been a stock we have liked quite a bit as we believe the iPhone and Samsung Galaxy chipmaker has lots of potential. The stock has been volatile as of late due to Apple’s fall causing doubts about the growth of the smartphone market however look for strong guidance to send the stock higher. It’s not just speculation that backs up this stock, from top to bottom strong numbers help reassure both investors and analysts. Read our past article to find out more: SWKS & BRCM Two Component Suppliers of the iPhone That Are Long-Term Strong Buys
Also reporting on Wednesday is the social media giant, Facebook (NASDAQ: FB). Analysts are anticipating earnings of around $0.15 per share on revenue of $1.52 billion total. Facebook shares have been steadily recovering since the disastrous IPO, up close to 40% over the past three months.
Reports: ADP Nonfarm Employment Change (Expected 163k), GDP (Expected 1.5% Quarter-over-Quarter)
Earnings from: Fusion-IO (NYSE: FIO), Northrop Grumman (NYSE: NOX), Tetra Tech (NASDAQ: TTEK), Skyworks Solutions (NASDAQ: SWKS), QUALCOMM (NASDAQ: QCOM), Facebook (NASDAQ: FB)
Thursday we will see earnings from apparel maker Under Armour (NYSE: UA) and Altria Group (NYSE: MO).
Reports: Personal Income (Expected 0.8% Month-over-Month), Personal Spending (Expected 0.3% Month-over-Month)
Earnings from: AutoNation (NYSE: AN), Altria Group (NYSE: MO), Colgate-Palmolive (NYSE: CL), Mastercard (NYSE: MA), Xcel Energy (NYSE: XEL), Sherwin-Williams (NYSE: SHW), PulteGroup (NYSE: PG), Time Warner (NYSE: TWC), Under Armour (NYSE: UA), UPSE (NYSE: UPS)
Friday caps off the week with earnings report from Legg Mason (NYSE: LM).
Reports: Nonfarm Payrolls (Expected 155K), Unemployment Rate (Expected 7.8%), Michigan Consumer Sentiment (Expected 71.5), ISM Manufacturing Index (Expected 50.5)
Earnings from: Legg Mason (NYSE: LM), LyondellBasell (NYSE: LYB)
Beyond just earnings, investors will be able to digest all sorts of economic data points this week. It will be interesting to see how the market reacts to new data on new home sales, consumer confidence, unemployment, nonfarm payroll, durable goods orders, and GDP.
So prepare yourself, as it should be one of the busiest and most exciting weeks for the market in recent months.
Below is a very interesting graphic from Martin Kronicle on why so many people fail to succeed at Trading, enjoy!
Wall Street’s 3 Things to Watch For This Week: Facebook’s New Toys, eBay’s Financials, & the Big Banks Quarterly Earnings
It’s a big week for Wall Street with some rather large story lines set to play out. From the world’s largest social network’s showcasing some shiny new toys, to big earnings reports from some of the world’s largest banks and the top online marketplace. It will be a busy week none the less and here are your three main things to watch out for:
1. Is it time to bank on the bankers? With several of Wall Street’s largest banks set to report their latests quarterly results this week, much anticiaption is surrounding the financials and how they will perform. Due to report are Bank of America (NYSE: BAC) and Citigroup (NYSE: C) who are important snapshots of how traditional banking is holding up in this current economic climnate. Next we have Goldman Sachs (NYSE: GS) and JPMorgan Chase (NYSE: JPM) who will both shed some light on the volatile world of investment banking and how it is in fact performing. Last Friday we got a sneak peak of what’s to come when Wells Fargo (NYSE: WFC) posted reasonable results except to the dismay of some investors who were dissapointed to see that Wells Fargo’s mortgage refinancing business has slowed down.
2. What’s Facebook got to show? Mark Zuckerberg and Facebook (NASDAQ: FB) have some big surprises in store and some new shiny toys they want to showcase in their big company event. Slated for this Tuesday, the Facebook media event has a teaser reading “Come and see what we’re building.” Like you can imagine, there have been plenty of speculation surrounding what in fact Facebook is building. Some say a Facebook phone, others a social search engine, video advertising, expanding Facebook Gifts portal, new ways to shop, new methods to monetize their mobile usage, you name it. The possibilities are endless, and the speculation is at an all-time high. Only time will tell and we know everyone is counting down the clock until tomorrow’s big event.
3. eBay Might Not be as cool but their financial couldn’t be better! While eBay (NASDAQ: EBAY) isn’t as cool as it use to be with many of their regular users shopping and selling tendencies down compared to historical averages that’s not to say that eBay is struggling. While people aren’t fleeing to shop on the world’s largest virtual flea market like they use to, eBay has found its niche as an leading online marketplace for more established distributors to unload their wares. Frankly that’s fine with eBay executives as financially speaking, eBay is as big as its ever been. Not to mention the rapidly growling PayPal platform which has become the number one chosen and trusted financial service choice for many online and even offline transactions. eBay is set to report earnings this Wednesday and so far analysts expect at least a 15% jump from last year.
Continuously towards the end of the year newspapers, and magazines worldwide are filled with predictions, stock recommendations and trading ideas. We like many other top financial bloggers highly disregard these terrible ideas and think you should ignore them as well. It’s ironic how if you examine issue to issue you don’t tend to see them being all to consistent and never talking about their past successful picks, as most of the time there are none. We have always said that actions speak louder than words so if you can, always let your performance speak for itself. And for that, we present Fortune: 10 Stocks To Last The Decade A few major trends will likely shape the next ten years. Here’s a portfolio we can all forget.
August 14, 2000
1. Nokia (NOK: $54)
2. Nortel Networks (NT: $77)
3. Enron (ENE: $73)
4. Oracle (ORCL: $74)
5. Broadcom (BRCM: $237)
6. Viacom (VIA: $69)
7. Univision (UVN: $113)
8. Charles Schwab (SCH: $36)
9. Morgan Stanley Dean Witter (MWD: $89)
10. Genentech (DNA: $150)
Closing Prices December 19, 2012:
1. Nokia (NOK: $4.22)
2. Nortel Networks ($0)
3. Enron ($0)
4. Oracle (ORCL: $68.44)
5. Broadcom (BRCM: $49.89)
6. Viacom (VIA: $54.17)
7. Univision ($? )
8. Charles Schwab (SCH: $14.61)
9. Morgan Stanley Dean Witter (MWD: $14.20)
10. Genentech (Takeover at $95 share)
The portfolio managed to lose over +70%, with 3 bankruptcies, one bailout, and not a single winner in the bunch. Even the Roche Holdings takeover of Genentech was for 37% below the suggested purchase price. The lesson is that valuation matters. Had you merely bought the S&P 500 Index over that same time period, you would have seen a gain of 23.43%.
Have fun forecasting and think twice next time you see that magazine cover that sounds too good to be true.
Source: 10 Stocks To Last The Decade
Stocks on Wall Street has decided to add a new weekly section to our website called ‘Stock Talk.’ We allow our fans and readers to send us their stock picks and we will provide you with a brief recommendation or thought on the top stock selections in our weekly publication. Last week was the first time we started taking requests and as a result we have our first ever ‘Stock Talk’ article. Send us your picks for next weeks ‘Stock Talk’ by following the link: Contact Us!
BULLISH : BUY
Plains Exploration & Production Company (NYSE:PXP) PXP took advantage of BP’s need for cash and picked up assets on the cheap. In return, they’re poised to make a large profits off the assets making it a great timely investment. Tie that in with the company’s already strong growth prospects & the future looks great for PXP.
Walt Disney (NYSE: DIS) Disney’s recent acquisition of Lucas Films is pure genius. The markets may have not reacted as strong as some would have wished but this was a home run acquisition by Disney. Buying a brand like ‘Star Wars’ will be nothing short of a future gold mine for Disney. With two new trilogies already in the works and the Star Wars characters being added to the Disney Theme Parks, add that with the merchandise sales & just think of the unlimited revenue potential this deal will bring to DIS.
Hain Celestial (NASDAQ: HAIN) Things have never been better than right now for Hain Celestial and we expect all this great news to translate into higher stock prices going forward. According to Hain Celestial CEO, Irwin Simon, company sales have been through the roof during Hurricane Sandy and he doesn’t expect things to slow down one bit going forward. On top of these strong growth prospects, HAIN is backed by strong analyst recommendations giving this stock lots of potential to soar even higher.
QUALCOMM, Inc. (NASDAQ: QCOM) Don’t let the recent analyst downgrade on QCOM scare you away. From an investors standpoint, QCOM is still a strong stock loaded with potential.
EOG Resources, Inc. (NYSE: EOG) Energy is a booming sector once again, more specifically we’ve seen strength in the Natural Gas sector and when it comes to top natural gas producers, no company is stronger from top to bottom than EOG Resources. With analysts across the board saying ‘BUY’ we are to as the future looks strong for EOG.
Fossil, Inc. (NASDAQ: FOSL) Don’t let the recent missed earnings fool you into thinking that FOSL is dead as a stock. Instead let this be a time for investors to purchase shares of Fossil on a dip as since FOSL’s missed earnings report, shares have fallen 12% down from $94 to $84.
UBS AG (NYSE: UBS) UBS has restructured their business and from the looks of it, it’s for the better. UBS is getting out of their money-losing businesses and into money-making ones. If executed properly, this could be a big swing in the right direction. Nevertheless, UBS is saying and doing the right things, which is a start and makes us optimistic about where things are headed going forward.
ADT Corp (NYSE: ADT) ADT Security Company is a stock to watch out for now after strong back-to-back analyst upgrades. Receiving two strong recommendations in a short-term from reputable analysts gives us confidence that the company is on their way up.
News Corp (NASDAQ: NWSA) News Corp is set to spin off its ailing publishing business, which will overall be a big winner for shareholders. Barclays upgraded them from HOLD to BUY recently and we think they are onto something as NWSA has strong assets and growth opportunities going forward.
U.S. Bancorp (NYSE: USB) USB is being rewarded by domestic exposure in the markets making this U.S. centric mortgage bank a very attractive investment.
Wells Fargo & Company (NYSE:WFC) Much like USB, strong domestic exposure will reward WFC investors with stronger earnings, profits, and in all higher stock price.
Apple Inc. (NASDAQ:AAPL) Can you ever go wrong by investing in Apple? If you look at the Apple’s historical prices, whenever people say it’s time to SELL or that the company is set for a drop, it soars even higher. We believe AAPL is being unfairly punished by Wall Street, as shares have fallen over 20% since their recent highs. The good news is this gives long-term investors an even more attractive valuation for Apple, allowing investors to purchase shares of AAPL at a discounted price point. As iPad Mini and iPhone 5 sales continue to soar, everything looks like it will be just fine for Apple going forward.
Yamana Gold Inc. (NYSE: AUY) Gold is safe and steady investment especially if you are still worried about future inflation concerns for the U.S. and other global currencies. We think Yamana is a great investment from top-to-bottom and one of the gold stocks to own. We believe they have a high growth ceiling and many great future opportunities for investors. Add to that SPDR Gold Shares (NYSE: GLD) and you will be holding two of the best gold stocks worldwide.
Matrix Service Co. (NASDAQ: MTRX) This small cap engineering company is one to watch out for. Top to bottom MTRX is a steady investment with lots of potential going forward. Analysts across Wall Street back this theory up with high expectations for MTRX with 12-Month price targets of $15, a total net yield of 45%.
MGM Resorts (NYSE: MGM) Last week we disclosed in our article ‘Best Bet on Macau?‘ that we were no longer bullish about Wynn Resorts (NASDAQ: WYNN) and in fact skeptical of their long-term potential recommending new investors to avoid the stock altogether and current investors to HOLD their shares. When it comes to MGM, why bother? There’s a saying that you should never stoop lower down the food chain and investing in MGM would be doing just that as they’re a step behind the WYNN as it is. If you want a strong casino stock, look at Las Vegas Sands (NYSE: LVS).
Walgreens Company (NYSE: WAG) While some people are saying buy Walgreen based on weakness, we think that’s not a valid reason to invest at all and would rather just avoid the stock altogether as there are many better investment options out there.
Align Technology, Inc. (NASDAQ: ALGN) After poor quarterly results and weak overall performance there is little good news to convince us to buy shares of ALGN. While the stock has had success in the past, we just don’t see it in the future and are staying on the sidelines as a result. If you already own ALGN, HOLD your shares and stay put however don’t go out purchasing any new shares if you’re an investor looking for growth opportunities.
McDonald’s Corporation (NYSE:MCD) Hold off on the Big Mac and Fries everyone, McDonald’s monopoly month was not enough to convince us to invest. What we want to see is a couple strong consecutive monthly reports and then we can reassess our standing but until then stay put.
PDL BioPharma Inc. (NASDAQ: PDLI) PDLI is a risky, high-ceiling play that has been talked a lot about recently. Some people think it will pop and be one of the top stocks to own in 2012, on the other hand others think the stock will do nothing but disappoint investors. We are siding closer to the latter as we think PDLI is too risky of a bet with little upside to make it worth it.
Workday Inc. (NYSE: WDAY) WDAY might be one of the hottest new stocks of 2012 but we hold a neutral position when it comes to WDAY as an investment.
BEARISH : SELL
Caesars Entertainment Corp (NASDAQ: CZR) Like we said earlier with MGM, there’s no reason to stoop down the food chain when it comes to Casino stocks and Ceasars falls below even MGM so you can already see where we’re going with this recommendation. The stock has been dropping ever since it’s IPO and we expect share prices to continue to slide even further going forward making it not a stock you want to be a part of. If you want a casino stock to invest in, then go with Las Vegas Sands (NYSE: LVS) other than that stay away from CZR.
Intel Corporation (NASDAQ: INTC) Apple’s decision to drop Intel as their chip maker and go in house making their own is huge news for technology stocks and much to the dismay of Intel executives. This stunning announcement will sting big-time when it comes to Intel’s future earnings as AAPL was giving Intel lots of business that will be hard to ever replace. As a result, INTC is no longer a tech stock you want to own.