When the Federal Reserve first suggested a gradual tightening of its monetary policy in May 2013, investors began to wonder if the long-running bull market would come to an abrupt end.  #-ad_banner-#A quick spike in interest rates at the time gave a sense that times were indeed changing. Yet investors end up shrugging off that noise: The S&P 500 rose an impressive 22% between July 1 of last year and June 30 of this year. Toss in dividends and investors garnered a 25% total return — roughly the amount investors should expect to garner over a three year period in… Read More

When the Federal Reserve first suggested a gradual tightening of its monetary policy in May 2013, investors began to wonder if the long-running bull market would come to an abrupt end.  #-ad_banner-#A quick spike in interest rates at the time gave a sense that times were indeed changing. Yet investors end up shrugging off that noise: The S&P 500 rose an impressive 22% between July 1 of last year and June 30 of this year. Toss in dividends and investors garnered a 25% total return — roughly the amount investors should expect to garner over a three year period in normal times. But these are not normal times. The stunning 191% gain for the S&P 500 since bottoming out in March 2009 is remarkable in light of the fact that the subsequent economic rebound after the Great Recession has been quite tepid. Low interest rates, a huge amount of global liquidity and very high corporate profit margins all get credit for the bull market that has exceeded the wildest expectations of even the most aggressive market strategists. At this point, it might seem the wisest path to sit back and enjoy the ride, waiting for another 20% gain over the… Read More

When Nick Woodman, founder and CEO of GoPro (Nasdaq: GPRO), appeared on “60 Minutes” last November, his company’s fate was sealed.  #-ad_banner-#​That segment showed a variety of amazing feats you could accomplish with the company’s ruggedized, miniaturized wearable digital camcorders — and it led to a huge spike in orders for the company. That led Woodman to realize that the buzz around the company was so loud that it was time to start preparing for an initial public offering (IPO). Fast forward to June 26,… Read More

When Nick Woodman, founder and CEO of GoPro (Nasdaq: GPRO), appeared on “60 Minutes” last November, his company’s fate was sealed.  #-ad_banner-#​That segment showed a variety of amazing feats you could accomplish with the company’s ruggedized, miniaturized wearable digital camcorders — and it led to a huge spike in orders for the company. That led Woodman to realize that the buzz around the company was so loud that it was time to start preparing for an initial public offering (IPO). Fast forward to June 26, 2014, and GoPro’s public debut has marked the company as one of the hottest — and perhaps most controversial — new issues on the market. How hot is this stock? Priced at $24 a share, GPRO opened at $28.65 and is already up in the low $40s (though below its $49.90 peak). For investors looking for a piece of the action, a classic conundrum has emerged: Do you buy the hot IPO in expectation of robust price appreciation in the years ahead as sales grow — or do you hold off and wait for the air to come out of… Read More

If the stock market held the Golden Raspberry award (given to the worst movie of the year), then Higher One Holdings (NYSE: ONE) would win the prize.  #-ad_banner-#The provider of financial services and other products to college campuses saw its shares plunge 62% in the first half of 2014, the worst performance of any stock in the S&P 400, 500 or 600. Higher One has dubious company: Of the 1,500 companies in those three indices, 47 have fallen at least 25% since the year began.  As we pass the midpoint of the year, it helps to scour this group of… Read More

If the stock market held the Golden Raspberry award (given to the worst movie of the year), then Higher One Holdings (NYSE: ONE) would win the prize.  #-ad_banner-#The provider of financial services and other products to college campuses saw its shares plunge 62% in the first half of 2014, the worst performance of any stock in the S&P 400, 500 or 600. Higher One has dubious company: Of the 1,500 companies in those three indices, 47 have fallen at least 25% since the year began.  As we pass the midpoint of the year, it helps to scour this group of broken stocks. Though many of them have intractable problems that will take a while to fix, some of them have the ingredients for an impressive snapback rally. This is a good time to start researching rebound candidates, but it’s not yet time to buy them. Instead, follow the “10% rule,” which is a phrase coined by my colleague Bob Bogda. The best time to buy these stocks is when they have begun to move higher again, as I discussed in late June. Here are three stock in the group of losers that I am tracking. When they start to trade… Read More

When interpreting the tea leaves of the economy and the market, economists, money managers, analysts and most garden-variety market pundits consult the same set of widely used economic indicators.  #-ad_banner-#The S&P/Case-Shiller home price indices. Various purchasing managers’ indices. An array of employment reports.  All of these are good, tangible indicators about the health of the overall economy and the direction of the markets.  However, I’ve found a widely held stock that indicates the health of many different indicators — from commodity costs to wage inflation — and often foreshadows how the broader equity markets will behave.  I look… Read More

When interpreting the tea leaves of the economy and the market, economists, money managers, analysts and most garden-variety market pundits consult the same set of widely used economic indicators.  #-ad_banner-#The S&P/Case-Shiller home price indices. Various purchasing managers’ indices. An array of employment reports.  All of these are good, tangible indicators about the health of the overall economy and the direction of the markets.  However, I’ve found a widely held stock that indicates the health of many different indicators — from commodity costs to wage inflation — and often foreshadows how the broader equity markets will behave.  I look to the Golden Arches.  What the stock tells me is much more than how many burgers and fries Mickey D’s has sold. Including revenue from franchised outlets, McDonald’s (NYSE: MCD) boasts annual sales in excess of $30 billion, which would make the company the world’s 68th-largest economy (just ahead of Ecuador). Let’s look at the two most important components of McDonald’s business and enable it to serve 1% of the Earth’s population every single day: materials and labor. In terms of materials, McDonald’s uses 1 billion pounds of beef a year — in the U.S. alone. That’s equal to 5.5… Read More

Wall Street’s big banks, and particularly their analyst corps, are notoriously late to the party when it comes to upgrades.  #-ad_banner-#Yet being late doesn’t mean they’re wrong. In fact, their delayed arrival often gives the stock a bullish jolt. That’s precisely what happened this week when Goldman Sachs upgraded video-streaming company Netflix (Nasdaq: NFLX) from “neutral” to “buy.” Goldman also raised its price target significantly, to $590 from $380, an increase of more than 55%. In its note to clients, Goldman said that Netflix has the potential to more than double its global subscriber base over the next… Read More

Wall Street’s big banks, and particularly their analyst corps, are notoriously late to the party when it comes to upgrades.  #-ad_banner-#Yet being late doesn’t mean they’re wrong. In fact, their delayed arrival often gives the stock a bullish jolt. That’s precisely what happened this week when Goldman Sachs upgraded video-streaming company Netflix (Nasdaq: NFLX) from “neutral” to “buy.” Goldman also raised its price target significantly, to $590 from $380, an increase of more than 55%. In its note to clients, Goldman said that Netflix has the potential to more than double its global subscriber base over the next three years. The renewed optimism from Goldman comes as Netflix continues to expand its footprint internationally, which includes a big push into Europe. In late May, Netflix announced plans to launch its streaming video service in six European countries, including the two biggest European markets, France and Germany. So how late to the party were Goldman’s analysts? Well, shares were trading 16% above their previous $380 target before the upgrade hit the wire. NFLX has more than doubled in the past year, and over the past 24 months, it is up an incredible 583%. Of course, Goldman’s arrival livened up… Read More

With the second half of the year underway, it’s prudent to take stock on how your portfolio performed in the first six months of 2014.  #-ad_banner-#In the same vein, it’s also the perfect time to see where any value or growth opportunities may lie as we go into the end of 2014. One billionaire has decided to make the latter much easier for investors. Mario Gabelli, the renowned value manager and founder of the GAMCO family of funds, took to CNBC last month and shared some of his views on equity markets. With no shortage of commentary… Read More

With the second half of the year underway, it’s prudent to take stock on how your portfolio performed in the first six months of 2014.  #-ad_banner-#In the same vein, it’s also the perfect time to see where any value or growth opportunities may lie as we go into the end of 2014. One billionaire has decided to make the latter much easier for investors. Mario Gabelli, the renowned value manager and founder of the GAMCO family of funds, took to CNBC last month and shared some of his views on equity markets. With no shortage of commentary these days on financial news networks, why should you listen to Gabelli? For starters, Gabelli has been investing for nearly six decades now. He has come a long way since buying his first stock at the age of 13. Now at the age of 72, his firm, GAMCO Investors, currently manages some $48 billion in assets, with Gabelli amassing a personal fortune of $1.8 billion along the way. As such, his experience should cause some ears to perk up when he dishes free institutional research. Fortunately for us, Gabelli mentioned three of his top picks for the latter half of… Read More

Let’s be realistic. You’re NOT going to get rich in a hurry by investing in mainstream blue-chip stocks. The S&P 500 is a handy benchmark and a good proxy for the U.S. economy, but it’s not going to make anyone rich unless you have decades to invest. #-ad_banner-#If you want to truly soar above the market, you have to dedicate at least part of your portfolio to serious big-game hunting. With that in mind, my team and I just released a report on my boldest predictions for 2015. These are ideas that you won’t hear about in the mainstream financial… Read More

Let’s be realistic. You’re NOT going to get rich in a hurry by investing in mainstream blue-chip stocks. The S&P 500 is a handy benchmark and a good proxy for the U.S. economy, but it’s not going to make anyone rich unless you have decades to invest. #-ad_banner-#If you want to truly soar above the market, you have to dedicate at least part of your portfolio to serious big-game hunting. With that in mind, my team and I just released a report on my boldest predictions for 2015. These are ideas that you won’t hear about in the mainstream financial press until it’s too late. In the past, my previous predictions have made thousands of dollars for subscribers of my newsletter, Game-Changing Stocks. For example, in 2009 we told our readers to expect a big move in nanotechnology. We said, “This is an opportunity of enormous proportions.” Our nanotech pick shot up 293%. My prediction for 2010 we called the “best sci-fi speculation of the year.” The powerful technology called RFID would be the root cause of our three stock picks soaring 42%… 89%… and 310%, a year after being featured in my list. And last year I predicted there… Read More

When my father graduated from college, he and many of his graduating class entered the workforce with the expectation that their chosen career paths would last until retirement.  #-ad_banner-#These employers valued loyalty and devotion almost as much as effort and innovation. The “company men” of my father’s generation provided their employers these qualities in spades. This feeling of being an essential part of the company was largely the same for blue- and white-collar employees alike. Fast-forward a generation or two, and things have changed. Today, employees see themselves as free agents, free to work for whoever offers the… Read More

When my father graduated from college, he and many of his graduating class entered the workforce with the expectation that their chosen career paths would last until retirement.  #-ad_banner-#These employers valued loyalty and devotion almost as much as effort and innovation. The “company men” of my father’s generation provided their employers these qualities in spades. This feeling of being an essential part of the company was largely the same for blue- and white-collar employees alike. Fast-forward a generation or two, and things have changed. Today, employees see themselves as free agents, free to work for whoever offers the best deal. This increase in employee mobility has accelerated an employment trend nearly 70 years in the making. The temporary worker industry as we know it today began in 1947 after World War II. Temp agencies were started to provide a low-cost labor force that wasn’t part of the powerful unions of the time. These temporary employees provided the same services as full-time workers for a fraction of the full-time pay — and without costing the employer benefits, vacation time or even Social Security taxes. During the 1970s, a period of deep recession in the United States, the temporary worker… Read More

General Motors (NYSE: GM) continues to reel from its seemingly constant string of recalls. On Monday, the company announced its latest — six new recalls affecting about 7.6 million vehicles.  #-ad_banner-#Yet, the stock has reached an interesting inflection point on the charts, which now offers traders a good long-side setup. In recent months, the news has focused on the company’s failure to detect a faulty ignition switch, which resulted in deaths and the company’s recalls of millions of vehicles.  From an investing standpoint, however, traders need to separate reality from perception. Getting hung up on… Read More

General Motors (NYSE: GM) continues to reel from its seemingly constant string of recalls. On Monday, the company announced its latest — six new recalls affecting about 7.6 million vehicles.  #-ad_banner-#Yet, the stock has reached an interesting inflection point on the charts, which now offers traders a good long-side setup. In recent months, the news has focused on the company’s failure to detect a faulty ignition switch, which resulted in deaths and the company’s recalls of millions of vehicles.  From an investing standpoint, however, traders need to separate reality from perception. Getting hung up on the headlines could cause you to miss out on profits.  Successful trading depends on one’s ability to put emotions aside and stick to a predetermined trading plan. Along the same lines, traders must be able to tune out the noise and focus on the news and price action that matters.   In the case of GM, some worry these massive recalls could bring about the second downfall of the company, but it is important to understand GM’s recent history and its relationship with the U.S. government.  When GM crumbled into bankruptcy under a mountain of debt during the financial crisis,… Read More

A quick look at institutional buying in June has shown that “sell in May and go away” may not apply to you…  #-ad_banner-#At least, not if your net worth is in the 10 figures. While many funds pull away from the markets during the summer lull (as my colleague David Sterman outlined in May), a subset of billionaires has continued to build new or existing positions in stocks surrounding the red-hot energy sector — and big ones, at that. Billionaire fund managers Leon Cooperman, Barry Rosenstein and Mario Gabelli have been putting their buying power to work in… Read More

A quick look at institutional buying in June has shown that “sell in May and go away” may not apply to you…  #-ad_banner-#At least, not if your net worth is in the 10 figures. While many funds pull away from the markets during the summer lull (as my colleague David Sterman outlined in May), a subset of billionaires has continued to build new or existing positions in stocks surrounding the red-hot energy sector — and big ones, at that. Billionaire fund managers Leon Cooperman, Barry Rosenstein and Mario Gabelli have been putting their buying power to work in the past few weeks, according to 13G and 13D filings submitted to the SEC in June. The regulator requires these documents to be submitted when an investment firm has acquired greater than 5% of a stock’s outstanding shares, which is considered significant ownership in the SEC’s eyes. These gurus have histories of successful stock-picking and have now focused their buying on companies with strong ties to the commodity sector. Let’s take a closer look at the stocks they’re targeting. Nordic American Offshore (NYSE: NAO )  Last week, Cooperman of Omega Advisors said he had acquired about 4.9 million shares… Read More