I hope I’m not dating myself too much, but I remember when the neighborhood chain drugstore was almost a one-stop shop for human needs.  #-ad_banner-#For example, you dropped off your film to get developed. You could get the ointment for that embarrassing itch. You could even get a BLT and some fries. (Not necessarily in that order.) The BLTs and fries are long gone, but the chain drugstore on the neighborhood corner has continued to evolve and embed itself into our daily lives. And it will continue to do so in an even bigger way going forward. By… Read More

I hope I’m not dating myself too much, but I remember when the neighborhood chain drugstore was almost a one-stop shop for human needs.  #-ad_banner-#For example, you dropped off your film to get developed. You could get the ointment for that embarrassing itch. You could even get a BLT and some fries. (Not necessarily in that order.) The BLTs and fries are long gone, but the chain drugstore on the neighborhood corner has continued to evolve and embed itself into our daily lives. And it will continue to do so in an even bigger way going forward. By far, the two biggest players in the drugstore space are Walgreen Co. (NYSE: WAG) and CVS Caremark (NYSE: CVS). If two-thirds of the Earth is covered by water, the remaining third is covered by these two companies. But which stock makes the most sense for your portfolio?  Side by side, there doesn’t seem to be much difference between the two. Both have massive retail presence nationwide. Both are adapting to the rising tide of change brought on by the Affordable Care Act (aka Obamacare).       One area both chains are exploring thanks to the health care evolution… Read More

America’s top two automakers, Ford (NYSE: F) and GM (NYSE : GM), are still trying to get their financial house in order. #-ad_banner-#GM is still faced with operational challenges as it aims to fix a long-broken culture, and Ford continues to invest heavily in new markets (such as China), while launching bold but expensive new vehicle platforms such as the soon-to-arrive all new aluminum F-150 pickup truck. Still, these companies are strong enough to offer up solid dividends that provide yields above 3%. The companies that do business with Ford and GM — auto parts suppliers — have gone a… Read More

America’s top two automakers, Ford (NYSE: F) and GM (NYSE : GM), are still trying to get their financial house in order. #-ad_banner-#GM is still faced with operational challenges as it aims to fix a long-broken culture, and Ford continues to invest heavily in new markets (such as China), while launching bold but expensive new vehicle platforms such as the soon-to-arrive all new aluminum F-150 pickup truck. Still, these companies are strong enough to offer up solid dividends that provide yields above 3%. The companies that do business with Ford and GM — auto parts suppliers — have gone a very different route. As I noted a year ago, these companies are leading the market when it comes to share buybacks. And judging by their recent plans, they have no plans to step on the brakes now. Here’s a quick snapshot of the falling share counts for these firms.  Shrinking Share Counts In theory, these stocks should have outperformed Ford and GM over the past 12 months, as share buybacks can boost per-share profits. Meanwhile, the Big Two’s focus on dividends doesn’t really have any sort of impact on earnings per share (EPS). It’s an interesting litmus test,… Read More

Martin Shkreli is having a very bad month.  The founder of biotech roll-up firm Retrophin (Nasdaq: RTRX) has spent nearly $3 million of his own money to acquire company stock over the past few months, culminating in a $500,000 purchase in early April. But like so many other investors, Shkreli had no idea that biotech stocks would suddenly crater. Those purchases are now deeply underwater.  #-ad_banner-#But this CEO’s loss may be your gain. With shares falling nearly 40% this month, investors have a chance to dig deep to see if there is value in these shares. Retrophin has acquired… Read More

Martin Shkreli is having a very bad month.  The founder of biotech roll-up firm Retrophin (Nasdaq: RTRX) has spent nearly $3 million of his own money to acquire company stock over the past few months, culminating in a $500,000 purchase in early April. But like so many other investors, Shkreli had no idea that biotech stocks would suddenly crater. Those purchases are now deeply underwater.  #-ad_banner-#But this CEO’s loss may be your gain. With shares falling nearly 40% this month, investors have a chance to dig deep to see if there is value in these shares. Retrophin has acquired a series of development-stage biotech firms, and Shkreli anticipates rising revenue streams in 2014 and 2015 from the acquired pipeline. A blogger on Seeking Alpha raised some legitimate concerns, but they were expressed when shares were still trading at $20.  Other companies have also seen solid recent insider buying (data provided by InsiderInsights.com), which include: 1. Intrexon (NYSE: XON )​ This is another biotech firm where an insider’s moves were poorly timed. Senior Vice President Gregory Ian Frost acquired more than $2 million in stock in early March, right before the entire sector skidded off the road. Read More

It’s the best thing since the invention of coins, checks or credit cards… In fact, it could make all previous forms of currency obsolete. My wife and I recently traveled from our home in West Virginia to St. Louis, Missouri. Jen and I drove more than a thousand miles, spent six nights in a hotel, ate however many meals and did some shopping. We each have a debit card, a credit card and a gas card, and Jen has a few store cards. We were gone a week, and I came home with the same ten $50 bills I’d gotten… Read More

It’s the best thing since the invention of coins, checks or credit cards… In fact, it could make all previous forms of currency obsolete. My wife and I recently traveled from our home in West Virginia to St. Louis, Missouri. Jen and I drove more than a thousand miles, spent six nights in a hotel, ate however many meals and did some shopping. We each have a debit card, a credit card and a gas card, and Jen has a few store cards. We were gone a week, and I came home with the same ten $50 bills I’d gotten at the bank before we left. It dawned on me how seldom I have any physical currency in my wallet — usually only when I travel. It’s certainly not because I go without any of the things I need or want; it’s because I simply don’t need to carry cash. I do, of course, need my smartphone. And Google (Nasdaq: GOOG) is onto something with its idea to put the two things together. “In the past few thousand years, the way we pay has changed just three times — from coins, to paper money, to plastic cards. Now we’re on… Read More

“The times, they are a-changing.”  #-ad_banner-#Watching the stock market closely over the last week brought Bob Dylan’s words to mind. The Dow Jones Industrial Average plunged over 600 points in six trading sessions, and the high-flying Nasdaq Composite Index sustained its largest drop in over two years. What’s more, five of the 14 IPOs slated for the past two weeks postponed their launches due to the sell-off. The majority of this selling was by hedge funds slashing their risk exposure, according to The Wall Street Journal, sending shivers of fear into even the most hardened of stock market… Read More

“The times, they are a-changing.”  #-ad_banner-#Watching the stock market closely over the last week brought Bob Dylan’s words to mind. The Dow Jones Industrial Average plunged over 600 points in six trading sessions, and the high-flying Nasdaq Composite Index sustained its largest drop in over two years. What’s more, five of the 14 IPOs slated for the past two weeks postponed their launches due to the sell-off. The majority of this selling was by hedge funds slashing their risk exposure, according to The Wall Street Journal, sending shivers of fear into even the most hardened of stock market players. This selling is different than what we witnessed in January. The January selling was triggered by the fear of a change in Federal Reserve policy and simple profit-taking. Last year’s bull market prompted many investors to simply wait until January to cash in so they could delay paying taxes on their fat gains for another year. In contrast, the current selling appears to be a shift from high-flying growth stocks to defensive stocks. I think this selling is signaling that the smart money is starting to position itself for a flat to down stock market in 2014. Read More

The trading action of 2014 thus far has been truly strange. A hot IPO market led to many impressive one-day gains for newly public companies. But many of those same stocks are now falling like a stone. So if you’re the type that waits for inevitable pullbacks in hot new issues, your opening is at hand. #-ad_banner-#These stocks are getting especially hard hit for several reasons. First, they were initially bought by investors looking for quick gains, not great long-term investments. Second, many of them are on a path for continued operating losses, and investors fear that a market mood… Read More

The trading action of 2014 thus far has been truly strange. A hot IPO market led to many impressive one-day gains for newly public companies. But many of those same stocks are now falling like a stone. So if you’re the type that waits for inevitable pullbacks in hot new issues, your opening is at hand. #-ad_banner-#These stocks are getting especially hard hit for several reasons. First, they were initially bought by investors looking for quick gains, not great long-term investments. Second, many of them are on a path for continued operating losses, and investors fear that a market mood shift will keep these firms from raising more capital. Open-ended losses are an especially strong concern for biotechs, which are basically built to lose money until a key drug is approved or partnerships is inked. So plenty of recently surging biotech IPOs have fallen sharply. Here’s a quick list of some that have already fallen from 30% from their post-IPO peak. The stock price chart for Dicerna Therapeutics highlights the bipolar investor attitude toward this group. Other biotech stocks that have fallen far from their recent peak include: • Mediwound (Nasdaq: MDWD) • Akebia Therapeutics (Nasdaq: AKBA)… Read More

I love fried catfish. There’s a tiny hole-in-the-wall restaurant on a back road that you could drive by and not know what it was that serves the best catfish I’ve ever had in my life. The owner is a jovial man who’s quick with a joke and an unassuming smile. Imagine my surprise when in the course of conversation, I learned that he can’t even eat his own food. He’s allergic to catfish. It’s not his fault, but how could he honestly stand behind his product if he couldn’t even sample it? To my thinking, any business owner who wants… Read More

I love fried catfish. There’s a tiny hole-in-the-wall restaurant on a back road that you could drive by and not know what it was that serves the best catfish I’ve ever had in my life. The owner is a jovial man who’s quick with a joke and an unassuming smile. Imagine my surprise when in the course of conversation, I learned that he can’t even eat his own food. He’s allergic to catfish. It’s not his fault, but how could he honestly stand behind his product if he couldn’t even sample it? To my thinking, any business owner who wants to sell their product or service should also be an avid consumer as well. If they don’t use it, how can they expect me to believe in its value? The same idea can be applied to stock picking. When I look for potential breakout stocks, one key giveaway that it’s undervalued is recent insider buying. No one knows a company better than the people who run it, so investors should pay attention when management starts buying stock.   One tiny micro-cap company looks like it has all the right ingredients for value investors. In March, a director purchased $1.5 million… Read More

In 2012, the star performer among sectors was the financial sector. In 2013, it was consumer discretionary stocks. For 2014, which sector can we expect to top the list? #-ad_banner-#While the future is impossible to predict with certainty, we can identify the latest, forward-thinking trends of investing gurus.        I looked at the 20 highest-earning asset managers and their common holdings, position sizes, and latest portfolio moves. After screening over 27,000 declared positions, a common theme for 2014 emerged: invest in dividend-yielding health care stocks. (My colleague Joseph Hogue profiled his favorite side play in this… Read More

In 2012, the star performer among sectors was the financial sector. In 2013, it was consumer discretionary stocks. For 2014, which sector can we expect to top the list? #-ad_banner-#While the future is impossible to predict with certainty, we can identify the latest, forward-thinking trends of investing gurus.        I looked at the 20 highest-earning asset managers and their common holdings, position sizes, and latest portfolio moves. After screening over 27,000 declared positions, a common theme for 2014 emerged: invest in dividend-yielding health care stocks. (My colleague Joseph Hogue profiled his favorite side play in this space earlier this week.)   More specifically, investors such as Warren Buffett, Ken Fisher, and Donald Yacktman have gone big on Big Pharma. Three stocks in particular each found a home in nearly half or more of the portfolios I scoured. What could be the main driver for such heavy investment into pharmaceutical stocks going into the end of last year? The answer is simple: the Affordable Care Act.  With the deadline to register being well-advertised over the past year, money managers were ahead of the curve and stocked up on drugmakers. For good reason too, as the government exceeded… Read More

The tech sector has been under fire of late. The large-cap Nasdaq 100 is down 5% over the past month, but it’s the smaller tech stocks that are really feeling the bears’ assault. Take newly public cyber-security software maker FireEye (Nasdaq: FEYE), for example. Shares have fallen nearly 50% since making an all-time high in early March. This decline comes on the heels of a wild surge following its September IPO. After going public at $20 on Sept. 20, FEYE vaulted some 80% in its first trading day to close at $36. From there, the stock traded sideways for the… Read More

The tech sector has been under fire of late. The large-cap Nasdaq 100 is down 5% over the past month, but it’s the smaller tech stocks that are really feeling the bears’ assault. Take newly public cyber-security software maker FireEye (Nasdaq: FEYE), for example. Shares have fallen nearly 50% since making an all-time high in early March. This decline comes on the heels of a wild surge following its September IPO. After going public at $20 on Sept. 20, FEYE vaulted some 80% in its first trading day to close at $36. From there, the stock traded sideways for the rest of 2013, before making an outstanding run higher in early 2014, peaking at $97.35 on March 5. FEYE then reversed course and came tumbling down below $50.  #-ad_banner-#However, on Tuesday, shares jumped as much as 7% on heavy volume. The catalyst for the buying was an upgrade from Wedbush Securities to “outperform” from “neutral.” The firm also lifted its price target on the shares to $72 from $62. According to Wedbush, the huge pullback in FEYE since the March 5 high took place due to a combination of a wider sell-off in the tech sector, a less-than-robust… Read More

One of the most popular investing strategies is riding the coattails of deep-pocketed investors, especially activist investors.  #-ad_banner-#One of the most successful activist investors has been billionaire Paul Singer and his Elliott Management firm. He and his firm specialize in finding undervalued situations and extracting more value for shareholders. Since Singer founded the firm in 1977, he has delivered his investors a net compounded annual return of 14.6%, which compares favorably with a 10.9% return from the S&P 500 Index. Over the years, Singer and his firm have mounted campaigns against the nation of Argentina over its debt… Read More

One of the most popular investing strategies is riding the coattails of deep-pocketed investors, especially activist investors.  #-ad_banner-#One of the most successful activist investors has been billionaire Paul Singer and his Elliott Management firm. He and his firm specialize in finding undervalued situations and extracting more value for shareholders. Since Singer founded the firm in 1977, he has delivered his investors a net compounded annual return of 14.6%, which compares favorably with a 10.9% return from the S&P 500 Index. Over the years, Singer and his firm have mounted campaigns against the nation of Argentina over its debt default, Compuware (Nasdaq: CPWR), Hess (NYSE: HES), Juniper Networks (NYSE: JNPR), and many others. (I’ve taken a look in recent months at some of Singer’s other moves.) The latest target for Paul Singer is regional casino operator Boyd Gaming (NYSE: BYD). Elliott Management recently disclosed that the firm owns 5.4 million shares, or 5% of the company.  Singer isn’t the only billionaire interested in Boyd. Noted value investor Mario Gabelli and his Gamco Investors also own a 3.1% stake in the company. Boyd owns 21 casinos in the U.S. At the end of last year, it owned and operated 1.3 million… Read More