Few sectors have been hit as hard this year as agriculture. Record-high crop production and a strong dollar are driving grain prices to multi-year lows. Since April, the price of corn and wheat have both fallen by more than 30%. Shares of companies in the sector performed relatively well over the first half of the year, following the broader market closely, but broke down quickly over the last five months. The Market Vectors Agribusiness ETF (NYSE: MOO) has dropped 6.9% so far this year, with nearly a 10% drop since the July high. Yes,… Read More

Few sectors have been hit as hard this year as agriculture. Record-high crop production and a strong dollar are driving grain prices to multi-year lows. Since April, the price of corn and wheat have both fallen by more than 30%. Shares of companies in the sector performed relatively well over the first half of the year, following the broader market closely, but broke down quickly over the last five months. The Market Vectors Agribusiness ETF (NYSE: MOO) has dropped 6.9% so far this year, with nearly a 10% drop since the July high. Yes, prices have fallen dramatically over the latter half of the year, but it was only two years ago that both corn and wheat hit all-time highs. In 2012, corn prices surged more than 50% in six weeks as drought destroyed production. While lower crop prices have producers sweating it out until next year’s growing season, investors may want to take advantage of lower prices now. That is exactly what one director at an agricultural equipment-maker is doing, increasing her controlling interest to more than a tenth of the company before what could be a boon for… Read More

Sometimes the market hands you a gift. And it would be foolish not to take it. Thanks to general market weakness, along with instability in the energy sector, the leading solar stocks have stumbled badly in recent weeks. The Guggenheim Solar ETF (NYSE: TAN), for example, has slid more than 20% since late August and many individual solar stocks have fared even worse. As I’ll note in a moment, a few names now stand out as compelling bargains. The Oil Connection At first glance, investors may mistakenly think that a drop in crude oil creates trouble for solar companies. Read More

Sometimes the market hands you a gift. And it would be foolish not to take it. Thanks to general market weakness, along with instability in the energy sector, the leading solar stocks have stumbled badly in recent weeks. The Guggenheim Solar ETF (NYSE: TAN), for example, has slid more than 20% since late August and many individual solar stocks have fared even worse. As I’ll note in a moment, a few names now stand out as compelling bargains. The Oil Connection At first glance, investors may mistakenly think that a drop in crude oil creates trouble for solar companies. It’s true that a sharp plunge in natural gas prices in the spring of 2012 created legitimate concerns that sharply reduced electricity costs would undercut the economics of solar. The same can’t be said for crude oil because it is not a prevalent input in global electricity generation. In fact, analysts at Merril Lynch note that the leading solar companies are seeing solid business momentum right now. “Strong 2H14 solar demand, stable equipment pricing, falling financing costs and robust U.S. residential market growth could lead to strong 3Q/4Q14 reports across the value chain.” That’s what makes this sector sell-off so… Read More

Momentum investing works both ways. Stocks in a strong uptrend can continue to outperform the market, as is often discussed in StreetAuthority’s Maximum Profit newsletter. Yet stocks in a downtrend can watch the tide take them even further out to sea. Indeed many stocks, which had already dropped 20% or 30% from their 52-week highs earlier in the year have seen their downward spiral accelerate in recent weeks. On several recent occasions, the number of stocks making new 52-week lows on the Nasdaq and NYSE has exceeded 200, an amount not seen in quite some time. #-ad_banner-#Amongst the rubble, some… Read More

Momentum investing works both ways. Stocks in a strong uptrend can continue to outperform the market, as is often discussed in StreetAuthority’s Maximum Profit newsletter. Yet stocks in a downtrend can watch the tide take them even further out to sea. Indeed many stocks, which had already dropped 20% or 30% from their 52-week highs earlier in the year have seen their downward spiral accelerate in recent weeks. On several recent occasions, the number of stocks making new 52-week lows on the Nasdaq and NYSE has exceeded 200, an amount not seen in quite some time. #-ad_banner-#Amongst the rubble, some stocks have really tumbled, falling by half, or more, from their 52-week highs. In some respects, these are “falling knife,” stocks. You don’t want to catch them while they are plunging. Yet as they keep falling and falling, these stocks often turn into deep-value plays, setting the stage for considerable rebound potential when the broader investor mood shifts. It is nearly impossible to try and time their bottom. They could always fall a bit further, but deep-value plays don’t stay that way forever. With that in mind, I took a look at all of the stocks that have fallen at… Read More

When is the next major correction coming? With the Dow and the S&P 500 Index just off their all-time highs, that’s the top question on investors’ minds right now. #-ad_banner-#​Some investors are feeling anxious, remembering the last time the market reached all-time highs back in 2008, only to see the market plummet by as much as 40% in just a few months’ time. Others perceive the market to be highly overvalued, and are ready to sell and take home some of their profits. And then there are those like myself who patiently wait for… Read More

When is the next major correction coming? With the Dow and the S&P 500 Index just off their all-time highs, that’s the top question on investors’ minds right now. #-ad_banner-#​Some investors are feeling anxious, remembering the last time the market reached all-time highs back in 2008, only to see the market plummet by as much as 40% in just a few months’ time. Others perceive the market to be highly overvalued, and are ready to sell and take home some of their profits. And then there are those like myself who patiently wait for a correction and the chance to buy great stocks when they go “on sale.” If you belong in that camp, you don’t have to wait anymore. I’ll show you the best place on the market to find deep discounts… and right now. As most investors wait for a pullback in the S&P 500 or the Dow, there’s another well-known U.S. index that is already experiencing a correction. While the S&P 500 and the Dow are up 3% and 1.4% over the past six months, respectively, the Russell 2000 Small Cap Index — the benchmark… Read More

While investors gauge the pulse of the market on a daily or weekly basis, and most companies weigh in on a quarterly basis, the executives at The Boeing Co. (NYSE: BA) think in terms of decades. Decisions they made a long time ago impact results now, and their current moves will impact shareholders well into the next decade. For these executives, the goal is quite simple: Invest massive sums in new designs and reap the rewards down the road. Back in October 2012, when I suggested Boeing as a top rebound candidate for coming years, I took note of a… Read More

While investors gauge the pulse of the market on a daily or weekly basis, and most companies weigh in on a quarterly basis, the executives at The Boeing Co. (NYSE: BA) think in terms of decades. Decisions they made a long time ago impact results now, and their current moves will impact shareholders well into the next decade. For these executives, the goal is quite simple: Invest massive sums in new designs and reap the rewards down the road. Back in October 2012, when I suggested Boeing as a top rebound candidate for coming years, I took note of a looming surge in free cash flow that could be sustained for many years to come. Since my last look at the company, Boeing became a free cash flow machine. For the three-year period that ends in December, Boeing is on track to rack up a cumulative $18 billion in free cash flow. That has helped set the stage for 10% annual dividend increases over the past few years and, by the looks of things, there’s plenty more where that came from. Because Boeing is making planes as fast it can (and at full list prices), and thanks to… Read More

Movie buffs may remember a strange film from 1999 called “Being John Malkovich.” In it, puppeteer Craig Schwartz (played by John Cusack) finds a magic portal into the mind of the well-known actor John Malkovich. As the movie title suggests, the portal lets people be Malkovich and live life in his shoes. #-ad_banner-#That’s impossible, of course, but it sort of makes you think of whose shoes you might want to step into if you could. And I’ll bet a lot of investors would pick the famous activist money manager Bill Ackman, who’s fond of taking large stakes in companies and… Read More

Movie buffs may remember a strange film from 1999 called “Being John Malkovich.” In it, puppeteer Craig Schwartz (played by John Cusack) finds a magic portal into the mind of the well-known actor John Malkovich. As the movie title suggests, the portal lets people be Malkovich and live life in his shoes. #-ad_banner-#That’s impossible, of course, but it sort of makes you think of whose shoes you might want to step into if you could. And I’ll bet a lot of investors would pick the famous activist money manager Bill Ackman, who’s fond of taking large stakes in companies and then using his influence to push for changes that benefit shareholders. The man clearly knows what he’s doing. Through his hedge fund company Pershing Square Capital Management, he generated a total return of nearly 1,200% in the past decade before fees, according to Forbes. That’s about 10 times what the S&P 500 delivered during the same period. Although you can’t actually be Bill Ackman, it’s easy enough to track his long portfolio through SEC filings — and there’s one holding in particular I’d like to bring to your attention. The company, a well-known supplier of industrial gases and chemicals with… Read More

Most investors you meet fall in two categories: those who love to find and follow trends, and those who are contrarians and habitually go against the grain. I’m not ashamed to admit that I fit into the latter category, following a Buffett-esque approach that pushes me to search for stocks that have fallen out of favor with the broader market.  I’m also not ashamed to admit that I love stock screens. Anyone who has read my previous research can attest to that. I see them as a great way to uncover stocks that might not normally come across your desk. Read More

Most investors you meet fall in two categories: those who love to find and follow trends, and those who are contrarians and habitually go against the grain. I’m not ashamed to admit that I fit into the latter category, following a Buffett-esque approach that pushes me to search for stocks that have fallen out of favor with the broader market.  I’m also not ashamed to admit that I love stock screens. Anyone who has read my previous research can attest to that. I see them as a great way to uncover stocks that might not normally come across your desk. #-ad_banner-#So what better way to combine my two investing loves than in a search for the latest, greatest reversal trades going into the end of 2014?  With the idea to source stocks that institutions love but markets hate, I set out to perform a multi-step screen to drill-down my investing universe.  I started with a basic sort by market capitalization and stock price.  While this screen is pretty speculative in nature, I wanted to eliminate any extra risk due to tiny stock prices or micro-cap sizes.  As such, I made sure market caps were $750 million or greater and stock… Read More

When most people start investing, they are urged to go with what they know. Used Colgate toothpaste all your life?  Buy some CL stock. Can’t imagine a day without a can of Coke?  Time to buy some KO shares. While I agree with the underlying premise, it proves a point about what I consider the “tangibility” of a brand.  Many stocks make their way into portfolios because they are seen, used or visited on a consistent basis by their investors. Falling under that argument are U.S. retail pharmacies, which seem to… Read More

When most people start investing, they are urged to go with what they know. Used Colgate toothpaste all your life?  Buy some CL stock. Can’t imagine a day without a can of Coke?  Time to buy some KO shares. While I agree with the underlying premise, it proves a point about what I consider the “tangibility” of a brand.  Many stocks make their way into portfolios because they are seen, used or visited on a consistent basis by their investors. Falling under that argument are U.S. retail pharmacies, which seem to find a home on every other major intersection in cities and towns across the country.  Drugstores like CVS Health, Walgreen, and Rite Aid are just as ubiquitous as Wal-Mart or Home Depot these days, making them prime candidates for investment under the “go with what you know” mantra. It’s a great starting point to whittle down your investing universe, but drugstores in particular happen to have many characteristics that make attractive investments in their own right. For long-term investors, the allure of drugstores centers on the two main industries they are tied the closest… Read More

Over the past few years, many fund managers have made the same complaint: “It’s hard to find deep values in this surging bull market.” #-ad_banner-#Now they can stop complaining. The steady erosion in the small cap side of the market — defined as companies with a market value between $100 million and $2 billion — means that dozens of companies now trade for less than 10 times projected 2014 profits. In fact, a recent screen reveals more than 100 such stocks. I narrowed this group down to a manageable few dozen by excluding banks, insurers, real estate investment trusts and… Read More

Over the past few years, many fund managers have made the same complaint: “It’s hard to find deep values in this surging bull market.” #-ad_banner-#Now they can stop complaining. The steady erosion in the small cap side of the market — defined as companies with a market value between $100 million and $2 billion — means that dozens of companies now trade for less than 10 times projected 2014 profits. In fact, a recent screen reveals more than 100 such stocks. I narrowed this group down to a manageable few dozen by excluding banks, insurers, real estate investment trusts and master limited partnerships. It’s not that these groups don’t hold appeal. It’s just that a price-to-earnings, or P/E, ratio is not necessarily the best way to assess them. With a narrowed list, it becomes apparent that some stocks are absurdly cheap. Yet they’re cheap for a reason. Their businesses are in trouble. Here’s a look at a handful of ultra-cheap small caps and the reasons they are so heavily-discounted. Company 2014 P/E Market Capitalization ($ millions) Reason They’re Cheap ITT Educational Services (ESI) 1.6 $102 For-profit education is struggling PDL BioPharma (PDLI) 3.4 $1,206 Unproven acquisition strategy Higher One Holdings… Read More

When a company reports earnings per share (EPS) that miss analysts’ estimates, it’s usually not read by Wall Street as a “buy” signal. However, when that company also reports better-than-expected revenue of $7.78 billion in the period, it definitely warrants your attention. #-ad_banner-#That’s precisely what happened to consulting and outsourcing firm Accenture plc (NYSE: ACN). On Wednesday, the Dublin-based company reported fiscal fourth-quarter numbers that were mixed, with the aforementioned revenue up 10% year over year, coming in well ahead of top-line forecasts for $7.62 billion.  The bottom line, however, is where Accenture came up short, with the… Read More

When a company reports earnings per share (EPS) that miss analysts’ estimates, it’s usually not read by Wall Street as a “buy” signal. However, when that company also reports better-than-expected revenue of $7.78 billion in the period, it definitely warrants your attention. #-ad_banner-#That’s precisely what happened to consulting and outsourcing firm Accenture plc (NYSE: ACN). On Wednesday, the Dublin-based company reported fiscal fourth-quarter numbers that were mixed, with the aforementioned revenue up 10% year over year, coming in well ahead of top-line forecasts for $7.62 billion.  The bottom line, however, is where Accenture came up short, with the company reporting adjusted EPS of $1.08. That metric was up 7% from the same quarter a year ago, but it didn’t quite meet analyst expectations for EPS of $1.10. For the full year, it was much the same for Accenture. The company showed a 5% increase in revenue for fiscal 2014 to $30 billion, firmly above estimates for revenue of $29.8 billion. As for the bottom line, the final EPS for the year was $4.52, an 8% jump from the prior year, but a penny below forecasts.  For ACN shares, the mixed earnings come at a time when the shares… Read More