UnlockRatingDividend strategy. People get confused about the dividend. It's not having a high dividend that matters. That could be because the stock price has fallen, or it could signal the dividend will have to be cut because the company can't afford it. A growing dividend is what drives stock prices. Whether a company consistently grows its dividend is a better methodology for looking at dividend-paying stocks. Gives you a nice yield over time, as well as a price that appreciates in value.
UnlockRating(A Top Pick Sep 24/20, Up 0%)Stockchase Research Editor: Michael O'Reilly Our PAST TOP PICK of PZZA has triggered its stop at $84. We previously recommended covering 50% of the position at the $100 objective. To be disciplined we recommend covering the rest of the position. This would secure an overall return of 9.5% on the investment.
UnlockRatingBilly Kawasaki’s Insights - Billy’s most-liked answers from 5i Research. Growth stocks have been weak for a few weeks. Investors are taking profits on stocks with embedded gains. The market, for now, is worried about higher interest rates. Unlock Premium - Try 5i Free
UnlockRatingToday's tech sell-off as reopening stocks rallied Today was the the bizarro stock market where good stocks got slaughtered and the bad ones thrived (JNJ, Pfizer), because the post-Covid boom has been pushed forward--suddenly sooner. Money managers now want airlines, cruiselines, industrials and hotels, while anything that rallied last year is despised, starting with the essential retailers, such as Costco, Walmart, Home Depot and Lowe's. Specialty retailers, too, such as Kohl's and Nike. Money managers are selling 2020 winners to buy the reopening stocks, fueled by the rising 10-year interest rate (signalling higher inflation). Like the late-2015/early-2016 rotation (more vicious to tech stocks then), this is currently a textbook rotation and, yes, it will be short-lived. That said, this pattern will continue for a little while longer. This rotation ends when the economy hits a wall or takes a breather and when this long-term interest rate rise halts. Note: The Fed says it will not raise short-term rates. At that point, the tide will turn and the 2020 winners will rise again. Interest rates never go up in a straight line, so expect choppiness. Nasdaq tech stocks rise on the hopes of rising earnings, but climbing interest rates--and inflation--limits that. So, sell all tech and buy industrials? That's okay if you're nimble. Or you can scale back on your favourite tech and buy them back even cheaper. The well-run companies that thrived in 2020 will eventually come back, but that could be a while if the economy seriously recovers.
UnlockRatingChance of a market correction? Half the world is working from home. The economy is very, very weak. It's being propped up by central banks. It's a very unusual time, and you need to recognize that straight away. Once people get back to work, governments are going to stop paying people, and you'll see the true extent of the economy. No doubt that we are going to get a correction. The tech names are 2 standard deviations away from their historical valuations. When you think tech downside, start thinking about 2000. The downside will be significant. Don't be scared, but be realistic.
MEG Energy Corp, Aritzia Inc. and More at 52-week Highs (Feb 24 Mar 02)
Stocks saw some regression Tuesday following the best market session in months at the beginning of the week. 10-year Treasury yield pulled back to more usual levels at 1.41%. Investor response remains neutral. The sector rotation out of growth to… read more
UnlockRatingAllan Tong’s Discover Picks Dollarama sells cheap stuff and has enjoyed a near-monopoly on selling household goods during these lockdowns. No argument that DOL has done very well. It peaked December 9 at $54.58 November 1, just shy of its all-time high. DOL stock has since peeled back 10%. It continues to enjoy a strong brand in Canada and the ubiquity of its locations. Its last quarter in December reported sales up 14% and earnings 23%, blowing past street expectations. DOL stock is expected to grow 15% this year. Given the winter lockdown, it’s safe to say that DOL stock will report another strong quarter or two. In fact, DOL has beaten three of its last four quarters. Read Battle of the Stocks: 2021 Consumer Staples Stocks for our full analysis.
UnlockRatingDepending on the company, those with multiples are fine as long they're growing rapidly with strong outlooks. The easy money in the recovery is probably behind us. Higher interest rates normally accompany a stronger economy, which is what is happening, and he sees continuing as we recover. He's not a commodity investor, though there is a serious recovery here; the easy money has been made. Once people can drive in the summer for vacations, he expects this demand to keep oil prices strong. Renewables require a lot of copper and steel to build that infrastructure. In recovery stocks, he owned a few cruiselines, buying low, but sold some.
Battle of the Stocks: 2021 Consumer Staples Stocks
Consumer Staples Stocks This week we look at how three pairs of consumer staples stocks that have rallied during the pandemic could fare as economies reopen while more and more people get vaccinated? Will these names continue to thrive, or… read more
UnlockRating(A Top Pick Dec 10/20, Down 15.8%)Stockchase Research Editor: Michael O'Reilly Our PAST TOP PICK with STRA has triggered our recommended stop at $81. To be disciplined, we recommend covering the position at this time. We will look for better opportunities.
UnlockRatingTechnical analyst Mark Sebastian explains VIX volatility Is there a volatility spike (quick) or swell (slow rise). If you want stocks to rise higher, you want a spike, like today's sharp rally, or in early June and early November. Buy! In swells, volatility slowly rises which happened last August into September as the S&P rose higher--then, markets fell in the autumn. Last week was a classic spike, so expect more upside in stocks; the VIX and S&P were not moving in tandem which happens in swells. We're not in the early stages of a major sell; in fact, the panic is over and the market is starting to roar.
UnlockRatingBilly Kawasaki’s Insights - Billy’s most-liked answers from 5i Research. The initial reaction to higher interest rates is the worst typically. There is some profit taking going on and investors are rotating sectors. Earnings are strong and we must keep a long term view. Unlock Premium - Try 5i Free
UnlockRatingMarket. The growth stocks initially did well when the pandemic started, then the cyclicals did well as inflation expectations increased. Inflation expectations have been increasing since last August but got ahead of themselves. Expectations for inflation should pull back somewhat. On a seasonal basis you find inflation tends to pick up until March. Industrials and materials tend to perform well in March and April, but there might be a turning point coming up here shortly.
UnlockRatingEducational Segment. Interest rates have risen pretty steadily this year. Every time bond yields go up, someone calls the end of the bull market. Bond vigilante is an investor that is gut-check against central banks when they lose control of the fiscal purse. Interest rates have been falling for the last 40 years and this trend continues. In 2017-2018 Feds raised interest rates. The US 10 year needs to get above 3.5% and remain higher to say the trend is changing. We simply cannot afford higher interest rates however. The next tool is Yield Curve Control. Interest rates will be kept low.
Spin Master Corp, Kinaxis Inc and More Earnings Reports this Week (Mar 01-05)
Stocks are expected to start March stronger off the February sell-off. Biden’s pandemic relief bill is headed to the Senate. The Treasury yield curve saw some steadying following central banks across the world maintain commitments to accommodative policy to support… read more
