Technology stocks remind me of a normally well-behaved child who occasionally throws a temper tantrum.  #-ad_banner-#When the overall market is strong — as it has been for the past several years — tech stock performance is typically stellar. On the other hand, when bear markets do occur, tech stocks typically lead the way lower. With the Nasdaq Compsite Index now trading near 4,200, up more than 80% from a low just under 2,300 in October 2011, the tech “child” has been very, very good lately. Drilling deeper into the tech sector, some of its best performers have been… Read More

Technology stocks remind me of a normally well-behaved child who occasionally throws a temper tantrum.  #-ad_banner-#When the overall market is strong — as it has been for the past several years — tech stock performance is typically stellar. On the other hand, when bear markets do occur, tech stocks typically lead the way lower. With the Nasdaq Compsite Index now trading near 4,200, up more than 80% from a low just under 2,300 in October 2011, the tech “child” has been very, very good lately. Drilling deeper into the tech sector, some of its best performers have been semiconductor stocks. Take NXP Semiconductor (Nasdaq: NXPI), for example, which I wrote about in November . It’s brought readers who took my advice nearly 40% returns in less than five months, and the stock is up more than 90% in the past year. SanDisk (Nasdaq: SNDK), which I recommended a couple of weeks ago , is already up 10% since then, and nearly 50% in the past 52 weeks. This week, it’s another semiconductor stock that I believe has strong potential: Freescale Semiconductor (NYSE: FSL). Based in Austin, Texas, Freescale is a global… Read More

If you hold any biotech stocks in your portfolio, then it’s time for a gut check. Share prices in this high-risk/high-reward group posted their biggest one-week loss in recent memory, leading investors to figure out if it’s time to get out now… or to commit more funds. How bad was the carnage? The SPDR S&P Biotech ETF (NYSE: XBI) slid nearly 10% on the week, and for many individual stocks, the erosion was far more severe. #-ad_banner-#Cancer-focused biotech Exelixis saw its shares plunge on poor clinical testing data, but all of these other stocks fell out for seemingly… Read More

If you hold any biotech stocks in your portfolio, then it’s time for a gut check. Share prices in this high-risk/high-reward group posted their biggest one-week loss in recent memory, leading investors to figure out if it’s time to get out now… or to commit more funds. How bad was the carnage? The SPDR S&P Biotech ETF (NYSE: XBI) slid nearly 10% on the week, and for many individual stocks, the erosion was far more severe. #-ad_banner-#Cancer-focused biotech Exelixis saw its shares plunge on poor clinical testing data, but all of these other stocks fell out for seemingly no explicable reason. Actually, there was a negative catalyst impacting this whole group: Congress recently questioned a move by Gilead Sciences (Nasdaq: GILD) to price a new hepatitis C drug at more than $1,000 per pill. Many investors quickly concluded that new drugs in development from other biotech firms may not fetch the high reimbursement rates that analysts had been suggesting.  To be sure, few drugs in development will be priced quite that boldly. (Indeed, Gilead subsequently relented and suggested that many insurers will get 20% to 30% discounts from that list price.) Yet the issue reminds investors… Read More

By 2030, the global middle class is expected to more than double in size from 2 billion to 4.9 billion. That demographic change is going to have a huge impact around the world. #-ad_banner-#For the people who join the middle class, it’s going to mean a significant amount of disposable income for the first time in their lives — allowing them to purchase the luxuries that Westerners have long taken for granted. For investors, it’s important to be aware of not only the fact that the ranks of the middle class are going to swell… but where. Today, half of… Read More

By 2030, the global middle class is expected to more than double in size from 2 billion to 4.9 billion. That demographic change is going to have a huge impact around the world. #-ad_banner-#For the people who join the middle class, it’s going to mean a significant amount of disposable income for the first time in their lives — allowing them to purchase the luxuries that Westerners have long taken for granted. For investors, it’s important to be aware of not only the fact that the ranks of the middle class are going to swell… but where. Today, half of the 2 billion people in the global middle class are from North America and Europe. By 2030, that share is expected to shrink to 22%. On the other hand, Asia is expected to have 64% of the planet’s middle class by 2030. As an investor, I want to make sure that the companies I’m investing in are going to have the wind at their backs for a long time to come. I like companies that benefit from the fact that people are living longer. I like companies that benefit from rising oil prices. And I like companies that are exposed… Read More

One company has been called the “most hated” in the world for a number of years. It was even declared “the most evil corporation of the year” in 2011 by NaturalNews.com — beating out BP (NYSE: BP), which had just spilled millions of gallons of oil into the Gulf of Mexico (and which I profiled just last week). #-ad_banner-#Even so, a couple of billionaires are less concerned with this company’s image than in its growth potential. Stephen Mandel’s Lone Pine Capital owns 5.8 million shares of Monsanto (NYSE: MON), and George Soros’ Soros Fund Management owns 1.2 million shares. Soros’… Read More

One company has been called the “most hated” in the world for a number of years. It was even declared “the most evil corporation of the year” in 2011 by NaturalNews.com — beating out BP (NYSE: BP), which had just spilled millions of gallons of oil into the Gulf of Mexico (and which I profiled just last week). #-ad_banner-#Even so, a couple of billionaires are less concerned with this company’s image than in its growth potential. Stephen Mandel’s Lone Pine Capital owns 5.8 million shares of Monsanto (NYSE: MON), and George Soros’ Soros Fund Management owns 1.2 million shares. Soros’ fund more than doubled its position during the fourth quarter of last year. And Lone Pine has been an owner of Monsanto for a few years now, continuing to own the stock despite the rise of negative publicity. Image Problems Monsanto has been something of an industry scapegoat over the past couple of years, while other seed companies, such as DuPont (NYSE: DD) and Bayer, have gone relatively unnoticed. It has been painted in a negative light by protesters, environmental activists and documentaries. A vow by Chipotle (NYSE: CMG) to drop all GMO (genetically modified organism) products hasn’t helped,… Read More

“Sugar and spice and all things nice” came to mind when I saw last week’s rally in McCormick & Co. (NYSE: MKC) following its better-than-expected fiscal first-quarter earnings report Tuesday. #-ad_banner-#McCormick, which manufactures and distributes spices, herbs, extracts, seasonings and more, posted earnings of $0.62 per share, up 9% from the year-ago period. First-quarter revenue rose 6% year over year to $993.4 million. Analysts were expecting EPS of $0.58 on revenue of $974.5 million. Management reaffirmed its fiscal 2014 earnings forecast of $3.22 to $3.29 per share, in line with analysts’ estimates of $3.27 per share. Not all consumer staples… Read More

“Sugar and spice and all things nice” came to mind when I saw last week’s rally in McCormick & Co. (NYSE: MKC) following its better-than-expected fiscal first-quarter earnings report Tuesday. #-ad_banner-#McCormick, which manufactures and distributes spices, herbs, extracts, seasonings and more, posted earnings of $0.62 per share, up 9% from the year-ago period. First-quarter revenue rose 6% year over year to $993.4 million. Analysts were expecting EPS of $0.58 on revenue of $974.5 million. Management reaffirmed its fiscal 2014 earnings forecast of $3.22 to $3.29 per share, in line with analysts’ estimates of $3.27 per share. Not all consumer staples stocks are created equal, but by definition, demand for their products shows little elasticity, meaning that they’re purchased in roughly the same quantity regardless of the economic cycle. This is especially true of spices, as you can only season your food so much. Boring companies like spice manufacturers also don’t have much in the way of news flow, and can therefore trend nicely higher during bull markets, making for a no-hassle longer-term investment. (My colleague Dave Goodboy made a similar point last week, singling out MKC for unique praise.) As an active trader, I rarely gravitate toward a stock like… Read More

It’s been nearly half a decade since the Deepwater Horizon incident spilled millions of barrels of oil into the Gulf of Mexico and killed 11 workers. However, investors and the nation as a whole will not forget the incident anytime soon. #-ad_banner-#Thus, many investors continue to shun shares of one of the key participants in the accident, BP (NYSE: BP). Yet, a couple of billionaires think the overhang from the Deepwater Horizon incident has presented an attractive buying opportunity. First, Seth Klarman and his Baupost Group hedge fund owned 5.6 million shares of BP as of the end of 2013. Read More

It’s been nearly half a decade since the Deepwater Horizon incident spilled millions of barrels of oil into the Gulf of Mexico and killed 11 workers. However, investors and the nation as a whole will not forget the incident anytime soon. #-ad_banner-#Thus, many investors continue to shun shares of one of the key participants in the accident, BP (NYSE: BP). Yet, a couple of billionaires think the overhang from the Deepwater Horizon incident has presented an attractive buying opportunity. First, Seth Klarman and his Baupost Group hedge fund owned 5.6 million shares of BP as of the end of 2013. Klarman has been a fan of BP since early 2011. Second, David Einhorn of Greenlight Capital owns nearly a million shares. Greenlight’s stake in BP was a new position at the end of 2013. Recent Contract Wins Since the spill, BP has been making strides in the right direction. The company remains the largest leaseholder in the Gulf region and second-largest oil producer. It has over 650 leases in the region and 10 drilling rigs — up from the six it had in 2010. In 2013, its underlying production in the Gulf grew for the first time since 2009. Read More

I don’t fit in with the Wall Street crowd.  Raised on a farm in rural Kansas, I have quite a different background than your average Wall Street hot-shot. But I’m no stranger to the scene. You see, prior to my role as Chief Investment Officer of Game-Changing Stocks, I spent many years at the business desk of one of the nation’s largest newspapers, the Newark Star-Ledger. And in my time there, I got a first-hand view of how things operate.  Fast-forward to today, and I spend much of my time on the phone with small-company executives who are designing the… Read More

I don’t fit in with the Wall Street crowd.  Raised on a farm in rural Kansas, I have quite a different background than your average Wall Street hot-shot. But I’m no stranger to the scene. You see, prior to my role as Chief Investment Officer of Game-Changing Stocks, I spent many years at the business desk of one of the nation’s largest newspapers, the Newark Star-Ledger. And in my time there, I got a first-hand view of how things operate.  Fast-forward to today, and I spend much of my time on the phone with small-company executives who are designing the next-generation fuel source… Other times I might be looking through government reports to find Pentagon technology that could eventually be used to make life-changing new products.  The majority of Wall Street analysts simply don’t do research like this. Instead, they seem to enjoy sensationalizing companies that are way past their primes.  But there’s another difference between Wall Street and me that I want to talk about today.  While the Street likes to go bonkers over earnings reports, I don’t. I believe wholeheartedly in considering earnings reports in an organized, standardized fashion. And I’d like to share that method with you… Read More

In recent quarters, a very clear trend has emerged among short sellers: #-ad_banner-#As a group, they’ve lost the nerve to go after the market’s most richly valued stocks. They’ve learned that focusing on the extremely rich multiples of many dot-com companies has caused many headaches, and you won’t find most of these firms at the top of the short interest lists these days. Still, these high-flying Internet companies, which I panned earlier this month, often trade for absurd multiples of price to expectations for 2016 free cash flow, which may eventually come back to bite them. Though the shorts are… Read More

In recent quarters, a very clear trend has emerged among short sellers: #-ad_banner-#As a group, they’ve lost the nerve to go after the market’s most richly valued stocks. They’ve learned that focusing on the extremely rich multiples of many dot-com companies has caused many headaches, and you won’t find most of these firms at the top of the short interest lists these days. Still, these high-flying Internet companies, which I panned earlier this month, often trade for absurd multiples of price to expectations for 2016 free cash flow, which may eventually come back to bite them. Though the shorts are still steering clear of these stocks, long-oriented investors appear increasingly inclined to book profits as they start to drift away from their 52-week highs: Notably, Facebook (Nasdaq: FB), Priceline.com (Nasdaq: PCLN) and Tesla Motors (Nasdaq: TSLA) all appear to have peaked about a month ago, dropping since by double digits, even as the Nasdaq flirts with new all-time highs. Of all of these stocks, I still think Twitter (NYSE: TWTR) and Priceline represent the greatest openings for short sellers looking to target frothy dot-com stocks. Curiously, short sellers are going after the major tech firms that… Read More

Among people with money to spend, there’s been a significant shift away from ultra-high-end purchases since the financial crisis, say analysts at global banking giant Barclays. #-ad_banner-#It isn’t that top-tier consumers have stopped spending, but nowadays even they’re more likely to scale it back a notch, devoting more dollars to what could be called the “affordable” luxury space. Simply put, wealthier shoppers are still looking for high-quality, fashionable items. But maybe they’re no longer quite so dead-set on the priciest versions like a $2,000 Gucci tote bag, a $1,500 Lanvin T-shirt, or a $4,000 Chanel purse. While this may not… Read More

Among people with money to spend, there’s been a significant shift away from ultra-high-end purchases since the financial crisis, say analysts at global banking giant Barclays. #-ad_banner-#It isn’t that top-tier consumers have stopped spending, but nowadays even they’re more likely to scale it back a notch, devoting more dollars to what could be called the “affordable” luxury space. Simply put, wealthier shoppers are still looking for high-quality, fashionable items. But maybe they’re no longer quite so dead-set on the priciest versions like a $2,000 Gucci tote bag, a $1,500 Lanvin T-shirt, or a $4,000 Chanel purse. While this may not be welcome news for high-end retailers, it bodes well for those specializing in affordable luxury — currently a $285 billion industry worldwide. With its increasing popularity, affordable luxury is projected to grow 8% to 10% a year domestically and 3% to 5% a year worldwide during the next few years. The big question for investors is how best to capture this growth. It might be tempting simply to default to Ralph Lauren (NYSE: RL) since it’s probably the best-known industry player, what with its iconic brands of apparel, accessories, and fragrances. But that would be a mistake. No doubt RL’s… Read More

Almost two years ago, it was all over the headlines. You couldn’t turn on CNBC or open an issue of The Wall Street Journal without hearing about it.  Then, May 18, 2012 came around — the day Facebook (Nasdaq: FB) went public.  It was the biggest Internet IPO in history — even bigger than Google (Nasdaq: GOOG), with a peak market capitalization of over $104 billion.  But as soon as the stock went public, it became clear that the party was over. #-ad_banner-#Thanks to a malfunction in the way Nasdaq’s computers handled millions of dollars in trades as well as… Read More

Almost two years ago, it was all over the headlines. You couldn’t turn on CNBC or open an issue of The Wall Street Journal without hearing about it.  Then, May 18, 2012 came around — the day Facebook (Nasdaq: FB) went public.  It was the biggest Internet IPO in history — even bigger than Google (Nasdaq: GOOG), with a peak market capitalization of over $104 billion.  But as soon as the stock went public, it became clear that the party was over. #-ad_banner-#Thanks to a malfunction in the way Nasdaq’s computers handled millions of dollars in trades as well as allegations that the company and its underwriters were involved in everything from inflating share prices, issuing too many shares and even overstating earnings, the stock eventually went into a tailspin.  All told, Facebook shares lost more than a quarter of their IPO value in less than a month and lost half their value within three months. While “the herd” was waiting to cash in on the runaway success of Facebook by buying shares as soon as they went public, the “smart money” was busy cashing out — selling their shares to a frothy public that had waited years… Read More