Editor’s Note: As Chief Investment Strategist of Total Wealth, Shah believes in making his track record of recommendations easily accessible to all readers within seconds – and that’s why he’s compiled an Archives page.
I hope you didn’t get suckered in by the Fed this week. Wednesday’s rally, which came just after the Fed announced a 50 basis point hike in the fed funds rate (instead of 75), wasn’t a sign to run back into the markets.
That was nothing but short covering. The markets are down again today and the trend is likely to continue downward until the Fed changes course. And it will.
Until then, we need to stick with what’s working, with the tried and true companies still making great earnings, to turn a profit – and I’ve got just the plays for you.
Watch today’s Buy, Sell, or Hold by clicking the video below, or go here to read the transcript.
May 05, 2022
Every bond and stock investor knows at least one Wall Street saying regarding Fed policy moves. Some of them are: “Never fight the Fed,” “Follow the Fed,” and “Don’t fade the Fed.” They’re good advice, but only to a point. …
The price of oil and gas is soaring once again. According to AAA, Americans pay around $4.20 per gallon at the pump. That’s not great for us, but oil and gas companies are breaking records. Some are reporting doubled (or, …
I think 2022 and early 2023 will be the year of big tech growth stocks.
You heard me right. I said “growth” stocks, not “value” stocks.
Since mid-2021, the market started pricing in higher interest rates. That impacted the valuation of tech companies based on discounted cash flow pricing models. And that, in turn, drove prices down on most tech growth stocks.
Now though, with the U.S. economy posting negative GDP last week, the Federal Reserve will have to tread very carefully regarding its interest rate policy.
If the Fed indicates any dovish change in its longer-term interest rate policy, we could see a huge rush of capital back into big tech growth stocks.
I don’t think the Fed will change its narrative anytime soon (for risk of losing credibility). Still, traders are going to see the same opportunity I’m seeing, and that’s going to cause small rallies as traders start to position themselves for the future in big tech companies like this one.
Every week, my inbox is flooded with questions, many of which can be summed up simply as, “Which of these stocks should I buy?” But, in times like these, I think the more important question to ask is, “Which stocks …
A year ago, the Fed had no plan to combat rising prices. Now they want the world to know they’ve got a plan to beat back what looks like increasingly sticky inflation because now their credibility is at stake.
That plan, which should be pre-set, steady, transparent, and formally announced as “forward guidance,” is instead going to be made up every six weeks when the Federal Open Market Committee (FOMC) meets.
Whether to raise the fed funds rate 25 basis points, 50 basis points, or 75 basis points (a basis point is one one-hundredth of a percentage point) at the FOMC’s upcoming May 3-4 meeting, or any subsequent meeting, isn’t set. And that is upending both stock and bond markets, and proof the Fed’s out of control.
The Fed raising rates isn’t going to kill inflation. There’s no way they could ever raise rates enough to kill it, and that gives us an opportunity.
The supply chain nightmare is catching up to e-commerce heavyweight Amazon.com (AMZN).
This time last year, analysts’ consensus estimates put AMZN’s earnings per share (EPS) at $15.79. In anticipation of this Thursday’s earnings report, that estimate fell 40%. That’s a huge year-over-year crunch – one that made some investors sell one of the best long-term investments out there.
As I mentioned in Monday’s Watchlist, sometimes the best way to profit is by going against the grain. Now, I’m saying it again. Don’t follow the crowd.
If Amazon reports EPS below $9.22, buy the dip – and I’ll tell you why in today’s video.
Apr 25, 2022
Sometimes, the best short-term trades are simply a matter of going against the grain.
When everybody is on one side of a trade, there comes a point when the best risk/reward scenario comes from betting against the herd. Legendary investor Jim Rogers compares this to everyone getting one side of a boat. When that happens, he says you probably want to be on the other side of that same boat…
Or risk getting dumped in the water as the boat tips.
Speaking of investors all being on one side of the boat, Wednesday was a pretty darn spectacular day where Netflix Inc. (NFLX) is concerned. The company reported results for the first quarter that missed various estimates, and the stock dropped nearly 40% before rebounding slightly in early Friday trading.
That’s what I call a serious beatdown. An overblown beatdown, at that, but we can use it to our advantage.
There was a running theme this week in the stocks you sent me: metals.
Gold, silver… precious metals that everyone expected to pop with the war in Ukraine raging on – but that’s not what’s happening. Frankly, GLD, GDX, and SLV are a waste of your capital right now. There may be a little bit more upside to each, so put your trailing stops in place, take your profits, and get out.
There are better places to put your money, including an ETF trade and a few of my favorite banks.
Check out my video below to learn more or click here to read today’s transcript.
More analysts, economists, and former Federal Reserve officials are predicting a recession – one that will stagger the U.S. economy. That’s frightening investors into selling profitable positions and going to the sidelines.
I say they’re wrong, and getting out of the market now is a mistake, and I’m telling you why in today’s edition of Total Wealth.
This company is one of my favorites. It’s a mega cap company with a capitalization over $2 trillion. Its revenue on a trailing-twelve-month basis is $185 billion. Its profit margin is 38.5%… and it’s still growing. There is no reason …
Apr 18, 2022
Let me tell you: My first job on Wall Street was with the Chicago Board Options Exchange (CBOE) in the early 1980s – just before the start of the great bull market… So I’ve been doing this for a very …
I said it once; I’ll say it again: inflation has not reached its peak.
While some investors and traders are piling back into the stock market – misguided by news claiming that March’s sky-high inflation measures were as bad as inflation would get – veteran companies watching the markets won’t be so reckless.
That’s one of the reasons I’m watching The Coca-Cola Company (KO).
The company will report Q1/2022 results on April 25. As we get closer to that date, the stock has been in an almost perfect upward trend, gaining 14% since March 10, 2022.
For the quarter, analysts expect Coca-Cola to report revenue and earnings of $9.82 billion and $0.58 per share, which would represent year-over-year increases of 8.9% and 5.45%, respectively.
Based on the company’s history, I expect it will beat estimates.
But, I’m focused on forward guidance and whether or not the company believes it can pass along higher input costs to the consumer.
I think the company will err on the side of caution and tamp down forward guidance in the face of inflation that’s running very hot.
And I think that could cause a pause in the recent rally – and present us with our next play.
This week, Twitter, Delta, and JP Morgan Chase have all been in the spotlight – and many of you are asking: What should we do with these stocks? Buy? Sell? Or hold on to our shares? Well, in today’s BS.H, …
On Tuesday, when the March reading of the headline Consumer Price Index (CPI) came out hot, but a tad less than jacked up expectations, stocks rallied. On Wednesday, when the Producer Price Index (PPI) came out hotter than hot, stocks …