Cabot Wealth Advisory for 02/2016
Apple (AAPL) - Buy, Hold or Sell?
Last week, Apple presented the bad news that iPhone sales growth has been slowing, and the stock gapped down in response. AAPL is now 29% off last year’s high (hit in April), and more and more investors are wondering what they should do with Apple—buy, hold or sell.
How to Benefit from Daily Trading Order Flow
As the market was unwinding, the question I often heard from subscribers of Cabot Options Trader and Cabot Options Trader Pro, was “what stocks were on your watch list to buy?” My answer was always the same: look at the Daily Order Flow Reading email that I send every day for the best ideas on what to short and what to buy.
Sell Apple, Buy Facebook?
Apple and Facebook are huge, global brands, Apple with a market cap of $533 billion and annual sales of $235 billion and Facebook with a market cap of $250 billion and annual sales of just $18 billion. Institutional investors love both stocks. But let’s look at the reality principle. Here are a couple of charts that show how AAPL and FB have performed over the last three months. I think the difference will be clear.
For Investors with a Taste for Adventure
For investors with a little taste for adventure, emerging markets are more fun than an unlimited ticket to a go-cart track (and offer much bigger potential rewards). Yes, when markets turn sour, emerging market stocks can take some skin off. But that only happens if you’re sitting like a bump on a log and watching your holdings tank.
Apple (AAPL) and Zika
The best time to buy Apple (AAPL) was in 2003 after the Internet Bubble had burst and technology stocks were treated like dirt. Of course, no one wanted AAPL back in 2003, but in the 13 years that followed, the stock soared 9,400%. The best time to sell AAPL was in mid-2012, when AAPL became the world’s most valuable company.
Five Steps of a Market Bottom: Where are We?
In my January 28 Cabot Wealth Advisory, I wrote about the five key characteristics to look for as the market builds a bottom. The market has deteriorated further since then, so I thought you’d benefit from brief updates in my upcoming Wealth Advisories (starting today) so you can see how the process is playing out until the bulls re-take control of the market.
The Growth Stock Diet
While there isn’t any substitute for the diet and exercise you promised yourself you’d do six weeks ago, there’s a stock diet that will allow you to make huge progress in your equity portfolio. It’s called the SNaC Diet, and it’s the best way to get your portfolio in shape, even if you can’t seem to make progress in the campaign against your love handles. SNaC stands for Story, Numbers and Chart, and it’s the method I use to pick growth stocks for the Cabot Emerging Markets Investor.
The Gold Star and the Falling Knife
The title of this piece is “The Gold Star and the Falling Knife.” So I guess I’d better pay that off. The Gold Star is a reference to the energetic rebound in the price of gold that’s been lifting mining stocks for the past couple of weeks. This is mostly a defensive move by investors who are looking some something that will hold value in a chaotic market environment. And after a nearly four-year pullback in gold prices, even those who aren’t fans of precious metals (like me) are getting a little gold gleam in their eyes.
Is Virtual Reality All Hype, or the Real Deal?
A couple of weeks ago, I published my Small-Cap Outlook for 2016. In it, I briefly described what I expect to be one of the most exciting trends in 2016—virtual reality (VR) and augmented reality (AR). For the record, I’m far from the only person with this view. And I think that’s a good thing—it means the profit potential is that much greater since interest is so widespread!
12 Ultra-Safe Stocks
Not all stocks are falling in this volatile market. The stock prices of leading companies operating in stable industries generally hold steady during market declines. I advise investing at least 50% of your portfolio into ultra-safe stocks and ETFs. I have assembled a list of 12 ultra-safe companies for your review.
Is the Bull Awake Yet? How About Now?
Investors, especially growth investors like me, know that a new bull market is an exciting time, ripe with opportunities. There’s a megaton of cash on the sidelines waiting impatiently for the new leaders to identify themselves. Being the first to know that The Bull is awake and coming down the chute is like being tipped off that tickets to your favorite rock group’s next tour are going on sale … a day before the world finds out. If you are a subscriber to any of these premium advisories, you will always know whether The Bull is awake and have an explicit guide to what you should be buying, selling and holding.
How Consistency Delivered 10 Doubles in Four Years
I have a lot of stock market advice written down. And it turns out that over the years I’ve been fairly consistent in the small cap advice that I’ve given during challenging markets. Most of the advice is the same each time the you-know-what hits the fan, as it’s been doing lately. For example, in the spring of 2010, small caps were in correction mode, and ultimately fell 15% before finding bottom.
Lessons from the Dot-com Bull and Bear Markets
I began my career on the floor of the Chicago Board of Options Exchange in 1999 straight out of college. For a year, I stood next to two trading legends, soaking up all of their wisdom as their clerk. That year, the market ripped higher as virtually every dot-com stock exploded higher day after day. I learned a great deal during that bull run.
3 Retail Stocks for the Next Uptrend
The decade-long secular bull market (early 2000s to 2014) in commodities is over, which means the next 10 years will probably bring generally “low” commodity prices. Who will that benefit? I think it will be retail and consumer-oriented companies, as consumers have more money to spend, and as input costs for food or materials decline and stay down. Thus, I’m on the hunt for some retail-related companies that can make huge runs during the next bull phase.
Growth Stocks: The Seven Deadly Sins
After much thought and soul-searching, I’ve compiled a list of the Seven Deadly Sins of Growth Investing. I hope it does your investing soul a lot of good. Here it is. My apologies that I couldn’t match the elegant, single-word terseness of the original.
3 Dividend Stocks to Buy Now
For long-term investors, now is a great time to look for high-quality investments that have been dragged down—ideally over a period of several months, so most of the sellers have already bailed—and are now starting to turn around. I recently ran a simple screen for dividend-paying stocks that match my selection criteria. Here are three of them.
3 More Dividend Stocks to Buy Now
Yesterday I wrote about three of my top dividend paying stock picks for this market environment, and today I want to share another three of the best dividend stocks to invest in right now.