As investors were picking up the pieces after the dot-com implosion, they came across another troubled sector. A series of looming patent expirations on key drugs meant that major pharmaceutical companies were on the cusp of a decade-long sales drought. Investors responded by dumping shares, as the AMEX Pharmaceutical Index plunged from 400 in late 2001 to just 250 a… Read More

As investors were picking up the pieces after the dot-com implosion, they came across another troubled sector. A series of looming patent expirations on key drugs meant that major pharmaceutical companies were on the cusp of a decade-long sales drought. Investors responded by dumping shares, as the AMEX Pharmaceutical Index plunged from 400 in late 2001 to just 250 a year later. A decade later, Big Pharma’s “patent cliff” was still a key concern, and this index remained far from its previous highs. Yet in recent quarters, Big Pharma has come back with a vengeance, as shares have moved back to the levels seen all those years ago. Credit goes to several factors, most notably the absence of any new imminent blockbuster-drug patent expirations, and an industrywide focus on shareholder-friendly moves such as share… Read More

As investors were picking up the pieces after the dot-com implosion, they came across another troubled sector. A series of looming patent expirations on key drugs meant that major pharmaceutical companies were on the cusp of a decade-long sales drought. Investors responded by dumping shares, as the AMEX Pharmaceutical Index plunged from 400 in late 2001 to just 250 a… Read More

As investors were picking up the pieces after the dot-com implosion, they came across another troubled sector. A series of looming patent expirations on key drugs meant that major pharmaceutical companies were on the cusp of a decade-long sales drought. Investors responded by dumping shares, as the AMEX Pharmaceutical Index plunged from 400 in late 2001 to just 250 a year later. A decade later, Big Pharma’s “patent cliff” was still a key concern, and this index remained far from its previous highs. Yet in recent quarters, Big Pharma has come back with a vengeance, as shares have moved back to the levels seen all those years ago. Credit goes to several factors, most notably the absence of any new imminent blockbuster-drug patent expirations, and an industrywide focus on shareholder-friendly moves such as share… Read More

Investing in semiconductor stocks can be quite challenging. Many of them languish for a long time — even as operations clearly improve — until suddenly, investors begin singing the company’s praises. That’s why I suggested investors stay the course with memory-chip maker Micron Technology (Nasdaq: MU). That patience has been rewarded, as Micron is now on the top of many “buy” lists and making a run for the $12 mark, after having more than doubled over the past… Read More

Investing in semiconductor stocks can be quite challenging. Many of them languish for a long time — even as operations clearly improve — until suddenly, investors begin singing the company’s praises. That’s why I suggested investors stay the course with memory-chip maker Micron Technology (Nasdaq: MU). That patience has been rewarded, as Micron is now on the top of many “buy” lists and making a run for the $12 mark, after having more than doubled over the past year. Although Micron may have a bit more upside, I prefer to focus on chipmakers that still suffer from very low expectations, even as their business starts to get stronger. Right now, that’s the backdrop for ON Semiconductor (Nasdaq: ONNN), which has integrated a series of recent acquisitions and is poised to generate robust free cash flow in the years ahead. Diversity Is A Virtue One of the reasons that you may have never heard of this company,… Read More

The lessons I learned in college during the summer vacation months have proved more valuable than the hard-earned academic ones. While working in the evenings and Saturday mornings at my uncle’s small marketing company in Miami, my cousin and I were fortunate to spend the days at the beach. Having grown up with a very fiscally conservative family in the Pennsylvania countryside, the fast life and glamour of Miami really took me… Read More

The lessons I learned in college during the summer vacation months have proved more valuable than the hard-earned academic ones. While working in the evenings and Saturday mornings at my uncle’s small marketing company in Miami, my cousin and I were fortunate to spend the days at the beach. Having grown up with a very fiscally conservative family in the Pennsylvania countryside, the fast life and glamour of Miami really took me by surprise! Fancy cars, speedboats, yachts and massive homes immediately caught my attention. It was truly mad money, and to top it off, some of these folks never seemed to work. While some were my uncle’s friends who owned this or that company, some of the over-the-top lifestyles really seemed to have arisen from out of thin air — in other words, from dubious sources.#-ad_banner-#… Read More

Stock markets jumped after the unemployment rate rose on hopes that the Fed will continue pumping up the… Read More

Warren Buffett‘s incredible success in the stock market has been built on two principles. The first is his long-term buy-and-hold mentality. Buffett likes to invest in companies with strong fundamentals and staying power that operate in industries with high barriers to entrance. That enables Buffett to hold on to shares for the long haul without having to worry about new players disrupting the competitive… Read More

Warren Buffett‘s incredible success in the stock market has been built on two principles. The first is his long-term buy-and-hold mentality. Buffett likes to invest in companies with strong fundamentals and staying power that operate in industries with high barriers to entrance. That enables Buffett to hold on to shares for the long haul without having to worry about new players disrupting the competitive landscape.#-ad_banner-# Owning stocks for the long haul has produced some of Buffett’s biggest gains. Take The Washington Post Co. (NYSE: WPO), for example. Buffett first began buying shares in 1973, recognizing the company’s long-term potential in the highly insulated media business. Forty years later, Buffett still owns those shares and is now sitting on a 6,800% gain, with his $11 million investment ballooning to $820 million in spite of shares falling… Read More

I have a friend named Tom who was fortunate enough to obtain a great-paying job out of college. He worked for a few years, saved some money with the employer’s retirement plan and slowly started climbing the corporate ladder. Tom lived in a one-bedroom… Read More

As the editor of two natural resources newsletters, I stay closely attuned to various industry costs: the average cost to mine an ounce of gold, the cost to refine a barrel of oil into gasoline, the cost to produce and ship a ton of coal from Australia to China. It goes without saying that fluctuations in these costs have a direct impact on the bottom line (and thus the share prices) of the companies involved. And in most cases, expenses are trending higher. Labor costs climb with each passing… Read More

As the editor of two natural resources newsletters, I stay closely attuned to various industry costs: the average cost to mine an ounce of gold, the cost to refine a barrel of oil into gasoline, the cost to produce and ship a ton of coal from Australia to China. It goes without saying that fluctuations in these costs have a direct impact on the bottom line (and thus the share prices) of the companies involved. And in most cases, expenses are trending higher. Labor costs climb with each passing year as workers receive salary bumps. Businesses that lease property and equipment usually see annual rent increases. And, of course, the raw materials needed to make finished products have grown more expensive. Many of these businesses aren’t in a position to raise prices, so they simply have to absorb the higher operating expenses and watch their profit margins get squeezed. Trust me, the market hates margin contraction. But there’s one small group of… Read More

I sheepishly raised my hand to ask the real estate guru a simple question during a “no money down”-type investment seminar in Florida back in the 1990s. “What happens when real estate prices stop appreciating and banks refuse to lend to support your investments?” The guru literally jumped backward, visibly disturbed someone would even think in such a way. “Impossible!” he exclaimed. “That… Read More

I sheepishly raised my hand to ask the real estate guru a simple question during a “no money down”-type investment seminar in Florida back in the 1990s. “What happens when real estate prices stop appreciating and banks refuse to lend to support your investments?” The guru literally jumped backward, visibly disturbed someone would even think in such a way. “Impossible!” he exclaimed. “That will never happen!” Well, the guru couldn’t have been more wrong. The overheated real estate market collapsed in 2008, bringing down the house-of-cards mortgage market along with it. The largest casualty was the quasi-governmental mortgage giant Fannie Mae (OTC: FNMA).#-ad_banner-# The U.S. government had to take the once-thriving entity into conservatorship for its very survival. This allowed Fannie Mae to use Treasury funds to support… Read More

For many investors, 2013 has been a good year. On May 7, the Dow Jones industrial average broke 15,000 for the first time ever. Since Jan. 1, the S&P 500 is up more than 15%. Microsoft, a company whose share price has been relatively flat for years, is up more than 30%. But there is one market sector that never got invited to the party. In fact, many of the companies that make up this unique market niche have seen their share prices plummet over the past three… Read More

For many investors, 2013 has been a good year. On May 7, the Dow Jones industrial average broke 15,000 for the first time ever. Since Jan. 1, the S&P 500 is up more than 15%. Microsoft, a company whose share price has been relatively flat for years, is up more than 30%. But there is one market sector that never got invited to the party. In fact, many of the companies that make up this unique market niche have seen their share prices plummet over the past three months, falling by as much as 20%. Share prices have fallen so far that many of these high-yielders are now trading below book value. In other words, investors are now able to snap up shares of companies yielding up to 19% for less than the company would be worth if it were to liquidate its assets and pay back its liabilities.  If you haven’t guessed, I’m talking about mortgage REITs (… Read More