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    Three Stocks to Avoid or Sell Next Week

    By
    Editorial Staff
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    0

    Seeking out great stocks to buy is important, but identifying quality investments is only half the battle.  Many would say it’s just as essential for investors to know which stocks to steer clear of.  A losing stock can eat away at your precious long-term returns.  By taking a proactive approach to avoiding losing stocks, you can set yourself up for greater success in your investing journey.

    Even the best gardens need pruning and our team has spotted a few stocks that seem like prime candidates for selling or avoiding.  Read on to find out why we believe these particular stocks are poor investment choices and learn how to apply our analysis to your own portfolio management strategy…

    Meta Materials (MMAT) 

    Semiconductor company Meta Materials develops and produces functional materials and nanocomposites, particularly in lithium battery materials.  The micro-cap company is losing far more money than it’s bringing in.  In the fourth quarter MMAT reported revenues of $1.4 million and operating expenses of $24.8 million. The company posted a net earnings loss of $79.1 million for the entire year.

    Not to mention, the company is  embroiled in litigation on accusations of involvement in “spoofing, naked short selling, market manipulation, and fraud.” Meta Materials share price is down 81% this year, falling to less than 25 cents per share.

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    Gap Inc. (GAP)

    Interest rates in America are now at their highest level in 16 years. While higher rates might tame inflation in the long run, they are likely to slow the economy in the near term and negatively impact certain areas of the market.  Clothing retailers such as Gap Inc. tend to suffer when consumers cut back on discretionary spending.  This reality has been reflected in Gap’s earnings performance, which have disappointed over multiple quarters. The current high-interest rate climate has proven to be a double whammy for The Gap, coming on the heels of two years of pandemic restrictions at its stores.

    The retailer is likely to continue struggling while rates remain high and consumers tighten their purse strings. Slowing sales and poor financial results, coupled with pressure from higher interest rates have pushed GPS stock 32% lower in the last year. The company’s share price is now down nearly 70% over the past five years.  The current consensus among 20 polled analysts is to Hold Gap shares.  

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    Fisker (FSR)

    Fisker remains committed to following through with delivery of 5,000 of its award-winning debut model, the Fisker Ocean, by September despite serious production headwinds.  A primary supplier to Fisker, Magna International, has significant supply chain problems that will increase the cost of production.  Obviously the company can’t pass those costs on to customers who’ve already reserved their vehicles.  Instead the EV maker will have to eat those costs, which will cut into crucial revenue from its first real production run.  At one point, Fisker looked like a potential leader in the EV race, now it seems like another stock to get rid of while you can. 

    FSR is one of the most heavily shorted stocks today.  Short interest on the stock increased by 12% to 68 million shares from March 31 to April 14, FactSet data shows. That’s nearly 40% of Fisker’s free float of shares, or the stock available for trading.

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    Three Lithium Stocks to Supercharge Your Long-Term Returns

    By
    Editorial Staff
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    0

    After a tough few months, lithium — a crucial element in electric vehicle batteries— is back in focus as prices rebound.

    Lithium futures on the LME were down over 45% year-to-date by the end of April and well off their record highs seen in late 2022. But this week, however, lithium prices started to bounce back for the first weekly increase since November 2022. Battery-grade lithium carbonate prices in China rose around 10% on the week, according to Refinitiv data.

    Though falling spot prices have raised red flags for investors over the long-term outlook of lithium miners, analysts believe spot prices will rise again as we get closer to the end of the year. “We expect pricing to find a bottom through the course of 2023 on the back of strong demand,” said Reg Spencer of Canaccord Genuity.

    In the long run, the supply and demand story for the silver-white light metal seems to be in the miner’s favor, and now may be the perfect time to strike on some of the beaten-down names from the industry.  

    Sigma Lithium (SGML)

    Last month Sigma Lithium achieved its first production of Green Lithium, officially transitioning the company from developer to producer. The company announced that it has successfully achieved first production of spodumene concentrate at its flagship Grota do Cirilo project in Brazil. Sigma reached production on time, which is a rare achievement for a lithium development project. As the project ramps to full production capacity, high-quality Green Lithium will be stockpiled and prepared for sale, with an inaugural first shipment of approximately 15,000 tons expected in May. 

    The company also recently announced that it had obtained its environmental operating license to sell all Green Lithium products from current and future production, including any stockpiled product. SGML currently holds a 75% buy rating from the 8 analysts that cover it. A median price target of $46.96 indicates an upside potential of 27%. 

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    Microvast Holdings, Inc. (MVST)

    Headquartered in Stafford, Texas, Microvast Holdings, Inc. designs, develops, and manufactures various Li-ion battery solutions for electric vehicles and energy storage systems. The company’s continued focus on R&D and technology investments offers improved battery performance at highly competitive prices. Microvast’s MV-C Gen 4 high-energy lithium-ion battery packs have been specifically designed for commercial vehicle applications, offering a high energy density of 53.5Ah, a long cycle life of 5,000+ cycles, and a modular pack design for easy installation. 

    “Microvast’s high-performance battery technologies provide the required high energy density, enabling us to deliver the high power and performance our industrial vehicles require to move heavy loads and perform demanding industrial applications,” explained Sven Woyciniuk, Head of Electrical Engineering at MAFI & TREPEL.  

    Analysts are only starting to take notice of MVST, with only two covering the stock. Nonetheless, both analysts see the stock as a Strong Buy and see a median increase of nearly 600% over the next twelve months. Microvast is a speculative play and may not be for everyone. Investors with a high tolerance for risk may want to consider this ticker for potential 6x gains.     

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    Lithium Americas Corp (LAC)

    Lithium Americas Corp has full ownership of two development-stage operations in Argentina. One of which is approaching initial production, expected to come later this year. The timeline has been disrupted on LAC’s US project –The Thacker Pass, Nevada lithium mine – due to ongoing legal and regulatory discrepancies. However,  a US judge recently said she would rule “in the next couple of months” on whether former President Donald Trump erred in 2021 when he approved the company’s right to begin mining the US’s largest-known lithium resource. It seems likely that the outcome of the case will be positive for LAC, considering Washington’s push to boost domestic production of metals crucial to the green energy transition and wean the country off of Chinese supplies.  

    The high-growth -potential small-cap has been gaining the attention of the pros on Wall Street. “We believe 2023 could be an eventful year as there could be several key announcements on growth projects and Argentina divesture, which could be catalysts for the share price,” explained HSBC analyst Santhosh Seshadri. To this end, Seshadri recently initiated coverage of LAC with a Buy rating, backed by a $36 price target.

    Most analysts agree with Seshadri’s thesis. LAC claims a Strong Buy consensus rating, based on 15 Buys vs. 1 Hold and no Sell ratings. At $37, the average price target makes room for 12-month gains of 87%.

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    Shining Bright Despite Challenges–Top Solar Picks for Exponential Growth

    By
    Editorial Staff
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    0

    The solar industry has had a bumpy twelve months as supply chain disruptions, rising production costs, and labor shortages have hampered the sector, but there’s no denying its long-term exponential growth. Over the last decade, solar energy has witnessed an average annual growth rate of 49%. This phenomenal growth is due partly to strong federal policies like the Solar Investment Tax Credit, which provides a 30% tax credit on solar investments.

    Another factor that is fueling growth in the industry is declining prices for solar components and installation. The cost of solar has plunged 90% over the past decade, along with falling equipment and infrastructure prices. An average-sized residential system has dropped from a price of $40,000 in 2010 to roughly $20,000 today.  

    The growth in solar is hardly restricted to the residential sector. Solar power has helped many Fortune 500 companies cut back on costs. Apple, Amazon, Target, and Walmart have all invested heavily in solar production at various locations around the country. Apple is leading the way with more than 390 MWs of commercial capacity, and Amazon is a close second with 329 MWs.

    Solar power isn’t going anywhere anytime soon, so continued growth can be expected in the long term. Business Insights projects that the $163 billion global solar industry will reach $194.75 billion by 2027, exhibiting a CAGR of 6%. This article will compare some of the top solar investments available.   

    The Invesco Solar ETF (TAN)

    The Invesco Solar ETF is a great way to gain exposure to solar without investing in just one stock. The fund seeks to track the MAC Global Solar Energy Index and comprises about 35 individual components — including U.S. and international stocks. The fund follows a blended strategy, investing in value and growth stocks with various market caps.  

    TAN’s share price peaked in mid-February 2021 and has fallen 43% since. However, it could be an excellent opportunity to get in at a more attractive price, as growth in the solar industry will likely gain strength in the long term.

    ETFs, by their nature, are often considered a less risky investment as they tend to be much less volatile than individual stocks. If you’re unsure about which solar stocks to buy and want to cut back on potential risk, TAN is a relatively safe way to add solar energy to your investment portfolio. 

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    Canadian Solar Inc. (CSIQ)

    Founded in 2001, Canadian Solar is a leading manufacturer of solar photovoltaic modules and a provider of solar energy solutions. CSIQ has delivered around 52 GW of solar modules to thousands of customers in more than 150 countries through the end of 2021, reaching approximately 13 million households. Canadian Solar derives roughly 47% of its revenue from Asia, 35% from the Americas, and 18% from Europe and everywhere else.

    Canadian Solar is one of the most bankable companies in the solar and renewable energy industry, having been publicly listed on the NASDAQ since 2006. The company has the potential to advance in the upcoming months based on its continued business growth, favorable earnings, and revenue outlook.

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    SolarEdge Technologies (SEDG)

    Israel-based SolarEdge Technologies operates in more than 30 markets, providing inverters, optimizers, monitoring equipment & tools, and accessories for harvesting and converting solar energy.  

    SolarEdge technology is some of the most respected in the industry, mostly due to the fantastic job they’ve done in reinvesting in R&D.  This is especially true when it comes to its inverters, where it is hands down the market leader. Its solar photovoltaic (PV) inverter systems are being installed in more than 133 countries across five continents. Climate change is an important global issue right now. SEDG share price will likely rise even more over the next few years as more residential and solar properties switch to solar power.  

    The current consensus among 35 polled analysts is to Buy SEDG stock. The 29 analysts offering 12-month price forecasts have a median target of $370, representing a 41% increase from its current price. SEDG is down 8% YTD.

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    Weekly Radar: Our Top Picks for The Coming Week

    By
    Editorial Staff
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    0

    Generally strong earnings results from the biggest technology companies overshadowed news that might otherwise have sent stocks lower last week. First Quarter GDP data released on Thursday showed that economic growth slowed markedly from the previous quarter and fell short of most economists’ forecasts. By Friday’s close, more than 50% of the S&P 500 reported Q1 2023 earnings, and 80% of those beat EPS expectations, per data from FactSet. The major indexes managed to eke out modest weekly gains of around 1% for a positive close to April. The S&P 500 added 1.5%, the Dow rose 2.5%, and the Nasdaq posted a tiny monthly gain.  

    Next week will be busy on the earnings front, with reports from Starbucks, Apple, and Berkshire Hathaway, among others, expected. Still, focus will shift to the Federal Reserve for the announcement of its next move on interest rates on Wednesday.   Market participants expect the Fed to lift its key benchmark by a quarter of a percentage point to a range of 5.00% to 5.25% in what will likely be the Fed’s final rate hike of the current tightening cycle.

    Anyone who keeps up with digital currency markets has heard about the major event slated for April 2024. Our first recommendation this week is a leveraged asset that’s set to benefit and is gaining attention from institutional investors ahead of this once-every-four-years event. 

    Microstrategy (MSTR)

    Bitcoin is up 76% since the start of the year, and it may be just getting started as the highly anticipated 2024 “bitcoin halving” draws near. Cloud-based service provider, Microstrategy, has been gaining attention from institutional investors who cannot invest directly in cryptocurrencies.  

    The bitcoin halving, which occurs every four years, reduces rewards for successfully mining new bitcoin by 50%. The aim is to reduce the supply of Bitcoin over time. Before the last halving, on May 11, 2020, the price of Bitcoin increased by 19% from the same day a year earlier. Bitcoin’s price reached record highs after each of the last three halvings; its price has tended to bottom out and start to rally 15 months prior to each halving. The next halving event is slated for April 2024.  

    Microstrategy offers “the most attractive means” through which equity investors can take advantage of the event, according to Berenberg Capital Analyst Mark Palmer, who cites its correlation of 0.90 to the crypto asset to support his stance. Year-to-date, MSTR stock has risen by 126.44%. Wall Street’s consensus rating for the stock is a Moderate Buy, with an average analyst price target of $415.00, implying an upside potential of 26.38% from current levels. Microstrategy is scheduled to report first-quarter earnings on May 1 after the market close.  

    Our following recommendation is an oil and gas midstream company, which like Microstrategy, is one to watch in the coming days ahead of its Q1 earnings report. 

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    ONEOK (OKE)

    ONEOK not only posted strong growth in the fourth quarter but expects higher 2023 results. In Q4, ONEOK posted adjusted EBITDA growing by 14% year-over-year. For 2023, it expects adjusted EBITDA of $4.575 billion at the midpoint. This year, it will support its growth by allocating capital to high-return organic projects that will lead to more substantial earnings as the company realizes high returns. This should enable ONEOK to increase its dividend, currently an impressive 5.81%.

    OKE is set to report first-quarter 2023 earnings on May 2, after the market close. This oil and gas midstream company’s first-quarter earnings are likely to have benefited from long-term natural gas storage contracts and expansions, as well as rising natural gas and NGL production volumes. OKE is definitely a ticker to keep an eye on as its earnings date nears.  

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    Axsome Therapeutics (AXSM)

    Axsome Therapeutics has two approved drugs on the market. Sunosi, a dopamine-norepinephrine reuptake inhibitor and the only one of its kind to treat narcolepsy, and Auvelity, a fast-acting oral treatment for depression, also the first of its kind. The latter launched in October and is being evaluated to treat agitation in people with Alzheimer’s disease and to help people quit smoking.   

    Share price sank more than 10% last month following the release of disappointing fourth-quarter earnings. The company incurred an adjusted loss of $1.28 per share and generated $24.4 million in revenues. Spending was up 227% year over year. But this increase was due to higher commercial activities for Sunosi and Auvelity, including sales force onboarding and marketing spending, which should pay off in the coming quarters.

    Other potential tailwinds include Axsome’s two other drugs — AXS-07 for treating migraines and AXS-14 for fibromyalgia — that it plans to submit for FDA approval this year.

    The stock is down 19% year to date but is up 78% over the past 12 months. Given the potential of Axsome’s therapies, the company’s $2.7 billion market cap may not adequately reflect its long-term potential.

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    Three Stocks to Avoid Like the Plague

    By
    Editorial Staff
    -
    0

    Seeking out great stocks to buy is important, but identifying quality investments is only half the battle. Many would say it’s just as essential for investors to know which stocks to steer clear of. A losing stock can eat away at your precious long-term returns. By taking a proactive approach to avoiding losing stocks, you can set yourself up for greater success in your investing journey.

    Even the best gardens need pruning, and our team has spotted a few stocks that seem like prime candidates for selling or avoiding. Read on to find out why we believe these particular stocks are poor investment choices and learn how to apply our analysis to your own portfolio management strategy…

    Lemonade (LMND)

    Thus far, the self-proclaimed insurance industry disruptor has gained a healthy following. But in all of the enthusiasm surrounding its  AI-based underwriting technology, investors may be turning a blind eye to its laundry list of flaws.

    In 2022 Lemonade generated a 116% increase in premiums. By contrast, the company expects just 12% year-over-year growth in 2023. Aside from the dramatic slow-down in overall business, the company is bleeding cash, posting an adjusted EBITDA loss of $225 million last year. This year’s EBITDA loss is expected to come in at around $242 million.

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    JetBlue (JBLU)

    With airline stocks currently trading at extremely low multiples, value seekers may be eyeing the group, wondering which ticker is the better buy. Some airlines will be more suitably positioned to withstand a slowing economy and possible recession, while JetBlue does not seem well-equipped for further negative impact. Anyone considering JBLU at less than eight times earnings would do better to consider a more stable name. 

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    Fisker (FSR)

    Fisker remains committed to following through with the delivery of 5,000 of its award-winning debut model, the Fisker Ocean, by September despite serious production headwinds. A primary supplier to Fisker, Magna International, has significant supply chain problems that will increase the cost of production. Obviously, the company can’t pass those costs on to customers who’ve already reserved their vehicles. Instead, the EV maker will have to eat those costs, which will cut into crucial revenue from its first real production run. At one point, Fisker looked like a potential leader in the EV race. Now it seems like another stock to get rid of while you can. 

    FSR is one of the most heavily shorted stocks today. Short interest on the stock increased by 12% to 68 million shares from March 31 to April 14, FactSet data shows. That’s nearly 40% of Fisker’s free float of shares, or the stock available for trading.

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    Golden Opportunities: Exploring Five Unique Gold Investing Strategies

    By
    Editorial Staff
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    0

    Gold has been a valuable and sought-after commodity for thousands of years, and it continues to hold a special place in the modern investment landscape. With its ability to act as a hedge against inflation and economic uncertainty, many investors are drawn to the shiny metal as a way to diversify their portfolios and potentially earn a profit. But with so many different ways to invest in gold, it can be hard to know where to start. In this list, we’ll explore the five most popular ways to invest in gold, from physical gold to gold royalties, and discuss the benefits and drawbacks of each. We’ll also give tips and specific stock recommendations so you can employ each of the various gold strategies now. So whether you’re a seasoned investor or just starting out, read on to broaden your knowledge and learn how to strategize to maximize results from your position in gold. 

    Physical Gold

    1. Investing in physical gold involves purchasing gold coins, bullion, or bars. This type of investment is popular because it allows investors to own a tangible asset. Physical gold is also a good option for investors concerned about inflation or economic instability. One of the drawbacks of physical gold is that it can be difficult to store and transport, and there may be additional costs associated with insuring and protecting it.
      • Bullion is typically sold by gram or ounce, and the purity, manufacturer, and weight should be stamped on the face of the bar. Purity is very important when buying gold: Investment-quality gold bars must be at least 99.5% pure gold. You can buy gold bars from dealers and individuals or online from sites like JMBullion, the American Precious Metals Exchange (APMEX), or SD Bullion. 

    VanEck Merk Gold Trust (OUNZ)

    A unique option for investing in physical gold is the VanEck Merk Gold Trust. This $700 million fund from VanEck takes physical gold to another level by allowing investors to redeem their funds and then take delivery of physical gold based on the amount they have in this ETF. The minimum shipment size is one ounce, and there are obviously fees and delays for shipping. But the option for physical delivery if and when you want it makes this fund very attractive to some.

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    Gold ETFs

    1. Gold exchange-traded funds (ETFs) invest in gold and trade on stock exchanges like a stock. This type of investment is popular because it is easy to buy and sell, and it provides investors with exposure to the price of gold without the need to own physical gold. Gold ETFs are also relatively liquid and can be easily traded throughout the day. One of the drawbacks of gold ETFs is that they are subject to management fees and other expenses.

    SPDR Gold Trust (GLD)

    By a wide margin, the largest gold ETF is the SPDR Gold Trust, the go-to way for investors looking to play the precious metal. It boasts roughly $59 billion in assets under management, roughly twice that of the next closest gold ETF, and regularly tops 10 million shares traded daily. It’s not the cheapest option out there based on annual expenses, but it is definitely the most liquid and established option. And as the fund is benchmarked to physical gold, you can get a direct play on gold bullion prices via this ETF. The fund charges 0.40% in annual expenses or $40 on $10,000 invested.

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    Gold Mining Stocks

    1. Investing in gold mining stocks involves buying stocks in companies that mine gold. This type of investment can be more volatile than other gold investments because it is subject to company-specific risks and market conditions. One of the benefits of gold mining stocks is that they may offer higher returns than other gold investments if the price of gold rises and the company performs well.

    Barrick Gold Corporation (GOLD)

    As one of the largest gold mining companies in the world, Barrick has a diverse portfolio of mines located in some of the world’s top gold-producing regions, which helps to mitigate risks associated with any particular location. With a robust portfolio of assets and a track record of successful acquisitions. The company has a strong balance sheet and is focused on delivering value to its shareholders through operational excellence and strategic growth initiatives.

    Barrick Gold Corp is up 21% over the past month and may have room to run. Analysts give the stock a Buy rating, and an average price target is $21.74, which represents a 16% upside. Considering the current market environment and the positive signals surrounding GOLD, it seems like a conservative estimate.  

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    VanEck Vectors Gold Miners ETF (GDX)

    VanEck Vectors Gold Miners ETF is a stock-focused fund. While not linked directly to gold bullion, it allows investors to get diversified exposure to some of the most prominent publicly-traded gold mining companies. It comprises about 50 miners, including Newmont Mining Corp. (NEM) and Barrick Gold Corp. (GOLD).

    Gold Futures and Options

    1. Gold futures and options are financial contracts that allow investors to speculate on the price of gold. This type of investment is popular among experienced investors and traders because it allows them to leverage their investments and potentially make larger profits. However, gold futures and options are also very risky and should only be considered by experienced investors who can afford to lose their entire investment.
      • Gold futures are traded at the COMEX division of the New York Mercantile Exchange (NYMEX). The standard contract size is 100 troy ounces, with two additional smaller contracts at 50 and 10 troy ounces. The exchange specifies the delivery of gold to New York area vaults and is subject to change by the exchange. An account approved to trade futures is required in order to trade gold futures.
    1. Gold Royalties: Gold royalties are a relatively new way to invest in gold that involves purchasing a share in a gold mine’s future output. This investment provides investors with a percentage of the gold mine’s production revenue without actually owning the physical mine. One of the benefits of gold royalties is that they can provide a stable income stream even if the price of gold declines. However, this type of investment can be more complex than other gold investments and may not be suitable for all investors.

    Sandstorm Gold Ltd (SAND)

    SAND is a gold royalty company that provides upfront financing to gold mining companies in exchange for a percentage of the future production of gold. The company’s unique business model provides investors with exposure to gold prices without the risks and costs associated with traditional mining operations.

    Recent financial results have been impressive, with strong revenue growth and improved margins. Additionally, the company’s balance sheet is solid, with a healthy cash position and no long-term debt.

    Technically, SAND is showing bullish signals on the charts, with a 19% gain over the past month. The Relative Strength Index (RSI) is also in bullish territory, indicating that the stock has momentum on its side.

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    In Summmary

    Overall, the best way to invest in gold will depend on an individual’s investment goals, risk tolerance, and investment experience. Some investors may prefer to invest in physical gold for its tangibility and security, while others may prefer to invest in gold ETFs or mining stocks for their liquidity and potential for higher returns. 

    Power Up Your Portfolio: Top Energy ETFs to Watch Now

    By
    Editorial Staff
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    0

    Energy stocks and exchange-traded funds (ETFs) were a popular bet in 2022. Russia’s war with Ukraine, higher travel demand, and other drivers sent U.S. crude oil prices from around $75 at the start of 2022 to multiple peaks above $120 across the year. The energy sector was far and away the best performer of 2022. The Energy Select Sector SPDR Fund (XLE) delivered a massive total return of 64.2% versus a negative total return for the S&P 500 and nine of its eleven sectors. But after a year like that, many wonder where energy is headed in 2023.

    The previous year’s tailwinds will be almost impossible to replicate. Still, certain sparks – including China’s reopening, continued conflict in Ukraine, and the possibility of more surprise output cut announcements from OPEC+ – could sustain a floor under oil prices. While the odds are against energy repeating as the S&P leader this year, there is reason to believe energy still has more gas in the tank. 

    Considering the industry’s nuances, choosing one or two energy stocks to invest in can seem intimidating. An ETF is an alternative that lets you profit from energy sector tailwinds without having to pick individual stocks. In this article, we’ll take a look at three energy ETFs to consider for long-term investors who want exposure to solid companies without the risk of choosing just one or two names.  

    Energy Select Sector SPDR Fund (XLE)

    The Energy Select Sector SPDR Fund is the most significant energy ETF on the market by far. At $38 billion, XLE has roughly 5x as much in assets under management as No. 2, the Vanguard Energy ETF (VDE) ~$8 billion in assets under management.

    XLE, which will celebrate its 25th birthday next December, is pretty cut-and-dry. It’s a collection of the energy-sector stocks found within the S&P 500. In other words, you’re getting a concentrated heap of big, blue-chip, U.S.-based oil-and-gas exposure. The fund is weighted by market cap, which means the bigger the stock, the larger the stake. Currently, its positions in Exxon Mobil (XOM) and Chevron (CVX) combined account for well over 40% of XLE’s assets. So if concentration is a concern, a different strategy may be more appropriate.   The fund has a desirable 0.10% expense ratio and a 3.8% dividend yield.  

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    Invesco S&P 500 Equal Weight Energy ETF (RYE)

    If XLE’s massive allocations to Exxon and Chevron make you nervous, there’s a way to get diversified energy exposure that’s much more evened out. The Invesco S&P 500 Equal Weight Energy ETF is one of the few energy ETF options not weighted by market cap.  

    Like XLE, RYE invests in the S&P 500 Energy Index, which means a current portfolio of the same 23 stocks. However, instead of weighting them by market cap, RYE starts every stock off at the same weight each quarter. The stocks might move up or down over the next three months, but regardless of how big or small they’ve gotten, RYE will rebalance them at the same weight come the next quarter.

    Currently, Chevron is still a top-10 holding but at under 5% of assets. Marathon Petroleum (MPC) and Occidental Petroleum (OXY) – which combined are worth $108 billion, versus Chevron’s $324 billion – are the two top holdings, with current weightings of 4.5% apiece. This Invesco fund will do the trick if you want to rest easy knowing you’re not carrying any excess single-stock risk. RYE has an expense ratio of 0.4% and a dividend yield of 3.7%.  

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    iShares Global Energy ETF (IXC)

    Energy inflation isn’t a purely American phenomenon. The rest of the world has also suffered from higher oil and gas prices … and many international oil giants have profited along with their U.S. counterparts.

    The largest, most liquid fund covering a worldwide spectrum of energy equities is the iShares Global Energy ETF (IXC) – a nearly $2-billion-plus portfolio of 52 companies that dominate global energy production, refining, storage, and other industries. The fund includes both domestic and international stocks. The official breakdown is U.S. 60%/rest of the world 40%, with the U.K. (12%), Canada (11%), and France (5%) representing the top non-American country weights.

    Giants Exxon and Chevron still lead the way here, at 17% and 11%, respectively. But this fund also provides significant exposure to international energy giants, including Britain’s Shell (SHEL) at 8%,  BP (BP) at 4%, and France’s TotalEnergies (TTE) at 5%. If you’re looking to defray a little geographic risk, IXC is one of the best energy ETFs to do so while still printing a nice profit from higher global commodity prices. The fund has an expense ratio of 0.4% and an attractive 4.7% yield.  

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    Weekly Radar: Our Top Picks for The Coming Week

    By
    Editorial Staff
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    0

    The major indexes edged slightly higher Friday–but finished lower for the week– as investors weighed recession and banking sector concerns against expectations for the remainder of the earnings season. Two weeks into the earnings season, 76% of the S&P 500 companies that have reported have beaten expectations, according to FactSet. That so-called beat rate ranks slightly below the 77% five-year average.

    Market participants will likely have a better sense of whether the next leg for equity markets is higher or lower next week, based on results from some of the largest companies in the world, including big tech companies Apple, Amazon, Google parent Alphabet, Microsoft, and Meta Platforms. Investors will also be tuned in on Friday for a critical update on inflation with the Personal Consumption Expenditures (PCE) Price Index—the Federal Reserve’s preferred inflation gauge–for March.

    Expectations that the Fed will pause rate hikes next month are growing. This wouldn’t be a cure-all but an important step towards a more sustainable recovery. In light of this, our first recommendation for this week may be looking at a substantial move higher in the near future.  

    BTC

    After eclipsing $30,000 the previous week, the price of Bitcoin dropped to nearly $27,000 on Sunday. Despite the latest week’s roughly 10% decline, the most widely traded cryptocurrency remained well above a recent low of just under $20,000. 

    Bitcoin bulls have claimed the digital currency is a way for investors to shield themselves against government moves, such as quantitative easing and looser monetary policy, which they say erodes the value of fiat currency. Industry insiders are saying that the anticipation of a slower pace of interest rate hikes from the Federal Reserve is helping Bitcoin. Proponents also point to its finite supply as a key feature of its being a store of value.

    “This past week’s events around the failure of SVB and other banks have also shone a spotlight on the power of decentralized currencies that people can fully custody and own,” said Vijay Ayyar, vice president of corporate development and international at crypto exchange Luno. “Decentralized finance is beginning to hit home in terms of a concept to many more people now.”

    Bitcoin is up over 65% this year, beating major stock indexes and commodities.

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    While earnings results so far have proved resilient, traders are on the lookout for insight into how companies are holding up amid a period of persistent inflation and rising interest rates. Our following recommendation has surpassed analyst expectations in the past two quarters and seems well-positioned to continue this trend when it reports earnings this week.

    Warner Bros. Discovery, Inc. (WBD)

    Warner Bros. Discovery is a leading global media company, TV and movie studios. Management’s top priority in the next six months is the relaunch of a consolidated streaming service with live sports content as a central part of the company’s portfolio, including its rights to the NHL, MLB playoffs and the NBA.

    Over the last four quarters, the company has surpassed consensus EPS estimates three times. Most recently, the company blew past earnings expectations with a 1,500% surprise. Prior to that, WBD delivered a 750% earnings surprise.  

    On average, Wall Street analysts predict WBD’s share price could reach $18.72 in the next 12 months. The average price prediction forecasts a potential upside of 29% from the current WBD share price. Look out for WBD’s next earnings release, expected on April 25.  

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    Novocure Ltd. (NVCR) 

    In the last five years, NovoCure saw its revenue grow at 22% per year. That’s well above most pre-profit companies. Meanwhile, its share price performance certainly reflects the strong growth, given the share price grew at 24% per year, compound, during the period. So it seems likely that buyers have paid attention to the strong revenue growth.

    Novocure makes a novel therapy for treating cancer called Tumor Treating Fields (or TTFields). The treatment uses electrical fields to disrupt cancer cell division. TTFields has already been approved for treating glioblastoma (a type of brain cancer) and mesothelioma (cancer caused by exposure to asbestos). The company is evaluating the therapy in clinical studies targeting non-small cell lung cancer, ovarian cancer, brain metastases, and pancreatic cancer. Combined, these additional indications represent a potential market 14 times greater than Novocure’s current market opportunity making it a high-growth stock to watch.

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    Three Risky Stocks to Avoid Like the Plague

    By
    Editorial Staff
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    0

    Seeking out great stocks to buy is important, but identifying quality investments is only half the battle.  Many would say it’s just as essential for investors to know which stocks to steer clear of.  A losing stock can eat away at your precious long-term returns.  By taking a proactive approach to avoiding losing stocks, you can set yourself up for greater success in your investing journey.

    Even the best gardens need pruning and our team has spotted a few stocks that seem like prime candidates for selling or avoiding.  Read on to find out why we believe these particular stocks are poor investment choices and learn how to apply our analysis to your own portfolio management strategy…

    Fisker (FSR)

    Fisker remains committed to following through with delivery of 5,000 of its award-winning debut model, the Fisker Ocean, by September despite serious production headwinds.  A primary supplier to Fisker, Magna International, has significant supply chain problems that will increase the cost of production.  Obviously the company can’t pass those costs on to customers who’ve already reserved their vehicles.  Instead the EV maker will have to eat those costs, which will cut into crucial revenue from its first real production run.  At one point, Fisker looked like a potential leader in the EV race, now it seems like another stock to get rid of while you can. 

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    Opendoor Technologies (OPEN)

    Opendoor Technologies (OPEN) aims to revolutionize the home-buying process with its automated solution for a smoother, quicker, and more convenient buying experience.  Investors piled into OPEN during its market debut in 2020,  However, OPEN stock has lost nearly 80% of its value over the past year, with expectations building that more pain could be on the horizon due to the widespread decline in the real estate market.  Redfin anticipates that there will be a 16% year over year decline in the number of existing home sales in 2023, making OPEN an ideal stock to sell.    

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    Ascent Solar Technologies (ASTI) 

    The photovoltaic specialist obviously carries significant implications for the solar energy industry.  With society gravitating toward clean and renewable energy solutions, ASTI should be enjoying extraordinary relevance. Unfortunately, its narrative hasn’t been so fortunate. Year to date, ASTI share price is down 72%. In the trailing year, it’s down almost 96%.  Glaringly, its three-year revenue growth rate sits at 90.3% below parity.  Profit margins have slipped to ridiculously negative rates while the balance sheet is a mess.  Gurufocus.com warns that Ascent solar is a possible value trap.  

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    Three Deeply Discounted Stocks with Enormous Growth Potential

    By
    Editorial Staff
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    0

    The growth stock collapse of 2022 has shifted to a growth stock resurgence in 2023. Cathie Wood’s growth-centric ARK Innovation ETF (ARKK) sank nearly 70% last year. This year it’s up more than 20% and may just be the beginning amid a shifting economic backdrop.

    Even after a hot start to 2023, some growth stocks look way too cheap. We’ve got three recommendations of stocks with stellar growth potential presenting attractive risk-reward propositions at their current prices.    

    Meta Platforms Inc. (META)

    One notable growth name that got hammered in 2022 is Meta Platforms Inc. The stock currently trades at less than 25x forward earnings. Still, with the most prominent family of apps and 4 billion users worldwide, META’s recovery this year has been swift. The ticker has stacked on 64% YTD. 

    Despite its recent rally, the social media leader’s stock is still down 46% from its high and looks cheaply valued for long-term investors. Meta trades at under 20 times the expected annual profit and four times expected sales. With a core business that has held up well against intense pressures, underappreciated potential for success in the metaverse and shares trading at multiples that leave room for big upside, Meta stock continues to look significantly undervalued.

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    Lithium Americas Corp (LAC) 

    By 2029, electric vehicles could account for a third of the North American market and about 26% of vehicles produced worldwide, according to AutoForecast Solutions. Lithium Americas Corp is one company hoping to ride the wave of anticipated global EV demand. The company has full ownership of two development-stage mining operations in Argentina. One of which is approaching initial production, expected to come later this year. 

    The high-growth -potential small-cap has been gaining the attention of the pros on Wall Street. “We believe 2023 could be an eventful year as there could be a number of key announcements on growth projects and Argentina divesture, which could be catalysts for the share price,” explained HSBC analyst Santhosh Seshadri. To this end, Seshadri recently initiated coverage of LAC with a Buy rating, backed by a $36 price target.

    Most analysts agree with Seshadri’s thesis. LAC claims a Strong Buy consensus rating, based on 13 Buys vs. 1 Hold and no Sell ratings. At $37, the average price target makes room for 12-month gains of 74%.

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    AssetMark Financial Holdings (AMK)

    Leading asset manager AssetMark Financial continues to grow as it looks to become a full-service wealth management platform. Its recent acquisition of Adhesion Wealth, which provides wealth management technology solutions to investment advisors and asset managers, will expand its offerings. The company has been growing rapidly and has forecast annual EPS growth of 32% during the next five years. It has also seen its valuation come down to a P/E of 22, which is an excellent value for this growth stock.

    The stock is up 34% already this year. Even if the market does retreat, AssetMark still expects roughly 10% growth in assets on its platform in 2023 and 20% year-over-year revenue growth. And as we emerge from this volatile market toward the next bull market, the company, a leader in the market, should see continued growth since asset managers thrive in bull markets.

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