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    Bear Watch Weekly: Stocks to Sideline Now

    By
    Editorial Staff
    -
    0

    The right stocks can make you rich and change your life.

    The wrong stocks, though… They can do a whole lot more than just “underperform.” If only! They can eviscerate your wealth, bleeding out your hard-won profits.

    They’re pure portfolio poison.

    Surprisingly, not many investors want to talk about this. You certainly don’t hear about the danger in the mainstream media – until it’s too late.

    That’s not to suggest they’re obscure companies – some of the “toxic stocks” I’m going to name for you are in fact regularly in the headlines for other reasons, often in glowing terms.

    I’m going to run down the list and give you the chance to learn the names of three companies I think everyone should own instead.

    But first, if you own any or all of these “toxic stocks,” sell them today…

    Dell Technologies Inc. (NYSE: DELL) – Margin Pressures and Competitive Doubts

    Dell Technologies, known for its robust involvement in the tech industry, has recently ventured into manufacturing high-performance AI servers, essential for developing sophisticated AI models. While strategically this positions Dell at the forefront of AI innovation, the company is struggling to establish a strong presence in this specialized niche.

    Despite a notable 22% increase in sales for its infrastructure solutions group (ISG), which houses the AI server business, Dell is facing significant challenges. The complexities and rising costs associated with producing these high-end AI servers are starting to impact profitability. This is evidenced by a slight 1% drop in operating income for the ISG segment, which alarmingly contributes to only 8% of its net revenues. More concerning is the sharp revision in Dell’s financial outlook, where it now expects a substantial decline in margins by 150 basis points for the full year.

    This financial adjustment reflects deeper issues within Dell’s strategy in the high-stakes AI server market and raises questions about its near-term competitive edge, as noted by Bloomberg analyst Woo Jin. The heightened costs and operational challenges in scaling this venture have led to growing skepticism among investors regarding Dell’s potential to capitalize effectively on its AI initiatives.

    Given these financial strains and competitive uncertainties, it may be prudent for investors to reconsider their positions in Dell. The current market dynamics and internal financial pressures suggest that Dell’s ambitious foray into AI server production might not yield the expected returns, making it a potential stock to sell from your portfolio.

    Affirm Holdings Inc. (NASDAQ: AFRM) – Time to Consider Exiting

    Despite Affirm’s striking 106% gain since June 2023 and its substantial $10 billion market cap, certain warning signs suggest it’s time to sell. The company, known for its “buy now, pay later” (BNPL) services, faces increasing risks that could undermine its recent success.

    Affirm’s model targets consumers with lower credit scores, offering them instant micro-loans at the point of purchase. This approach, while popular, becomes particularly risky in the current climate of rising credit card delinquencies—a trend that often precedes similar patterns in BNPL services. This correlation suggests potential for increased default rates among Affirm’s loans, a risk further substantiated by a significant $84 million increase in the company’s provision for credit losses over the past year.

    With the summer spending season likely exacerbating these issues, Affirm’s financial health could be further compromised. Given these factors and the broader economic outlook, Affirm presents a clear candidate for those looking to prune risky tech stocks from their portfolios.

    TransDigm Group Inc. (NYSE: TDG) – Overvalued and Overstretched

    TransDigm Group, a prominent player in the aerospace sector for both commercial and military aircraft components, currently displays several red flags that suggest it may be time to sell. The company’s stock is trading at an alarmingly high price-to-earnings (P/E) ratio of 52.4, significantly above the industry standard, suggesting a steep overvaluation by the market.

    Further deepening concerns, TransDigm’s price-to-earnings-growth (PEG) ratio stands at an excessive 5.02, indicating that the stock price has far outstripped realistic growth expectations. These figures are troubling, especially when compared against investing benchmarks which favor P/E ratios closer to 15 and PEG ratios near 1 as signs of fair value.

    A detailed analysis using the discounted cash flow valuation method paints a stark picture: TransDigm’s intrinsic value is estimated at merely $237 per share, a fraction of its current trading price of $1,288.65. This discrepancy suggests that the market’s optimism about future cash flows and earnings potential is grossly overstated.

    Given these metrics—particularly the extreme P/E and PEG ratios coupled with the significant gap between market price and intrinsic value—TransDigm emerges as a prime candidate for investors to consider selling. The stock’s current valuation levels appear unsustainable, especially in light of its financials and the broader industry context.

    July’s Top Stock Picks

    By
    Editorial Staff
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    0

    As we head into a new trading month, certain stocks show promise for robust performance in the current market environment. Here’s a closer look at a few selections that could potentially outshine their peers over the next 12 months.

    Walmart (NYSE: WMT) – Poised for Continued Expansion

    Walmart has demonstrated impressive growth, up nearly 28% this year, and the outlook remains favorable. The world’s largest retailer is expected to continue gaining grocery market share and benefit from its diversified revenue streams, including e-commerce and international operations. These initiatives are projected to drive about 4% sales growth and more than 4% operating income growth going forward. Oppenheimer sets a price target of $75 for Walmart, suggesting an 8.9% upside from its recent close, while JPMorgan is even more optimistic, upgrading the stock to overweight and setting a target of $81—indicating a potential 17.6% rise through next year.

    International Flavors & Fragrances (NYSE: IFF) – Strengthening Market Position

    International Flavors & Fragrances, which has climbed nearly 19% in 2024, continues to recover from an industry downturn. The company is focused on refining its strategic approach, enhancing productivity, and strengthening its balance sheet. Oppenheimer remains positive about its trajectory, assigning a price target of $116, reflecting confidence in its future performance. Jefferies also maintains a bullish stance, expecting a recovery in industry volumes in the latter half of this year, with expansion anticipated into the next year.

    Broadcom (NASDAQ: AVGO) – A Leader in Semiconductor Innovation

    Broadcom has seen a significant uptick, with shares rising nearly 43% this year. The optimism surrounding Broadcom is backed by its strategic positioning in the high-end filter market, efficient manufacturing processes, and robust potential for earnings growth and free cash flow generation. Oppenheimer’s target for the stock stands at $2,000, representing a 25.6% increase from its recent closing price, highlighting the strength of its business model. Furthermore, Bank of America has also raised its price target to $2,150, reinforcing the belief that Broadcom’s sales growth could double between fiscal years 2024 and 2026.

    These stocks, each leaders in their respective sectors, offer valuable opportunities for investors seeking to capitalize on proven performers with clear strategies for growth. Whether through technological innovation, market expansion, or strategic repositioning, each company is well-equipped to navigate the challenges and leverage the opportunities that lie ahead in the evolving market landscape.

    Major Opportunities in the Bourgeoning Global Tourism Industry

    By
    Editorial Staff
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    0

    The resurgence of travel and tourism post-pandemic has been impressive, with international tourism revenues reaching $1.4 trillion last year, nearly back to pre-pandemic levels. This growth, coupled with an optimistic outlook for 2024, signals a strong year ahead. Possible rate cuts could further enhance global economic conditions, boosting the travel industry even more.

    Interestingly, despite broader economic uncertainties, consumers continue to prioritize spending on travel experiences. Recent decreases in travel-related costs—airfares, car rentals, and hotels—offer an appealing entry point for consumers and investors alike. This environment creates a fertile ground for targeted investments.

    In our latest feature, we explore three travel stocks that are uniquely positioned to benefit from these trends. These companies are not just adapting but excelling, showing potential for significant gains by 2025.

    MakeMyTrip (NASDAQ:MMYT) – Positioned for Growth in India’s Travel Boom

    MakeMyTrip has seen an impressive 47% rally over the last 12 months, bouncing back from what many considered deeply oversold levels. This surge is not just a rebound but a reflection of the substantial growth potential in the Indian tourism market. As one of the fastest-growing economies with a burgeoning middle class, India’s travel sector is on the brink of a significant expansion.

    Forecasts suggest that Indian travelers will undertake five billion more trips by 2030, with spending in the tourism sector expected to reach $410 billion by the decade’s end. This presents a massive opportunity for MakeMyTrip, which already holds a leading position in the Indian online travel market.

    Post-pandemic, the company has shown a sustained improvement in operating margins, a trend that is expected to continue alongside its growth. This financial health positions MakeMyTrip as a potential multi-bagger stock, poised for accelerated growth as more Indians turn to online platforms to book their travels. As the landscape of Indian travel evolves, MakeMyTrip stands ready to capitalize on this trend, making it an intriguing pick for investors looking towards the future of travel.

    Expedia Group (NASDAQ:EXPE) – Strong Growth Prospects in Online Travel

    Expedia Group has emerged as one of the most undervalued stocks in the tourism sector. Despite rallying 41% in the last six months, it still trades at an attractive forward price-earnings ratio of just 11. Given its solid performance and the likelihood of strong quarterly results continuing, I am bullish on EXPE’s potential to double by the end of 2025.

    Operating as a leading online travel company, Expedia Group has a significant global presence. The company experienced its highest ever fourth-quarter revenue in Q4 2023, underscoring a robust post-pandemic recovery. For the full year, revenue climbed by 10% to $12.8 billion, while adjusted EBITDA rose by 14% to $2.7 billion, indicating strong operational leverage and potential for further EBITDA margin expansion this year.

    Expedia has also been proactive in expanding its global travel ecosystem, adding new partners and enhancing its service offerings. These strategic moves, combined with favorable industry trends, position Expedia to accelerate its growth in the near future. This backdrop makes EXPE a compelling investment opportunity for those looking to benefit from the ongoing recovery and growth in the travel industry.

    Corporacion America Airports (NYSE:CAAP) – Dominant Player in Emerging Markets

    Corporacion America Airports, with its extensive network of 52 airports and a service reach to over 81.1 million passengers annually, stands as a major force in the airport operation sector, particularly in South America. Its significant operations span from Buenos Aires, a major hub in Argentina, to other strategic locations in Brazil, Italy, Armenia, and beyond, making CAAP a pivotal player in global aviation.

    The company’s financial performance has been exemplary, consistently outperforming the sector with robust profit margins and impressive returns on equity. This success is partly attributed to the inherent advantages of being an airport operator, such as the natural monopoly in certain regions and relatively low operational costs.

    Recently, CAAP announced a modest year-over-year increase in passenger traffic of 0.8% for March 2024, signaling steady growth prospects. Despite a 50% surge in its stock price over the past six months, CAAP still trades at a compelling valuation of 11.31 times trailing twelve-month earnings. This combination of strategic market position, solid financials, and reasonable valuation makes Corporacion America Airports an attractive stock for investors looking at robust infrastructure plays in emerging markets.

    Three Strong Conviction Buys for the Week Ahead

    By
    Editorial Staff
    -
    0

    In the ever-shifting landscape of the stock market, separating the wheat from the chaff is no easy feat. It’s a world where the wrong picks can erode your hard-earned gains, but the right ones? They have the power to catapult your portfolio to new heights. With thousands of stocks in the fray, pinpointing those poised for a breakthrough can feel like searching for a needle in a haystack.

    This is where we step in. Every week, we comb through the market’s labyrinth, scrutinizing trends, earnings reports, and industry shifts. Our goal? To distill this vast universe of stocks down to a select few – those unique opportunities that are primed for significant movement in the near future.

    This week, we’ve zeroed in on three standout stocks. These aren’t your run-of-the-mill picks; they are the culmination of rigorous analysis and strategic foresight. We’re talking about stocks that not only show promise in the immediate term but also hold the potential for sustained growth.

    Curious to see which stocks made the cut? Click here to access the full watchlist and discover the exceptional opportunities we’ve unearthed this week. Trust us, this is one reveal you don’t want to miss.

    American Superconductor (NASDAQ: AMSC) – Energizing Future Growth

    American Superconductor has emerged as a notable player in the energy sector, particularly in the realms of electrical current regulation and renewable energy solutions. With a strong close to the fiscal year on May 29, the company reported impressive fourth-quarter results, showcasing significant year-over-year revenue growth from $31.74 million to $42 million. This performance highlights its expanding influence and operational efficiency, as evidenced by a shift from a cash burn of $22.5 million in Q4 of 2023 to generating $2.14 million in cash from operating activities.

    American Superconductor’s strategic partnerships have played a pivotal role in its recent success. Specifically, its collaboration with Inox Wind, an Indian wind energy developer, has proven fruitful. The revenue from its wind energy segment more than doubled to $7.8 million last quarter, affirming the positive impact of this partnership. As Inox Wind continues to grow, American Superconductor is expected to further benefit from this relationship.

    Looking ahead, American Superconductor is well-positioned for continued growth across multiple sectors. The company’s engagement with chipmakers is likely to reap rewards amid the rapid expansion of chip manufacturing in the United States. Additionally, as utilities strive to meet growing electricity demands through the construction of new power plants, American Superconductor’s products and services are set to see increased demand. This confluence of favorable market conditions and strategic partnerships makes American Superconductor a compelling stock to consider for those looking to invest in a company with robust growth prospects in the evolving energy and technology landscape.

    Vertex Inc. (NASDAQ: VERX) – Navigating the Certainty of Taxes with Innovation

    Vertex Inc. represents a compelling pick in the technology sector, specializing in enterprise tax solutions that are becoming increasingly vital in our tax-intensive world. With a robust suite of products designed to handle local, state, and value-added taxes, Vertex leverages both cloud subscriptions and traditional software licenses to meet diverse customer needs globally. In addition to its core offerings, Vertex also provides essential services like tax preparation, payment, and filing, making it a comprehensive solution for enterprise tax management.

    In fiscal year 2023, Vertex showcased impressive financial health, with overall revenue growing by 16.4% year-over-year. This growth was driven significantly by its software subscription revenues, which climbed to $480.8 million, marking a 15.7% increase. Even more notable was the surge in cloud revenues, which jumped by 27.1% to $214.6 million. Despite concluding the year with a 9-cent loss per share, Vertex demonstrated a solid net revenue retention rate of 113%. This figure highlights the company’s effective customer retention and capacity for expansion within its existing client base.

    With a 5-year monthly beta of 0.65 and a year-to-date price performance increase of 25%, VERX stands out as a stable investment in the tech sector. Its low volatility and consistent growth in a critical and expanding industry sector make Vertex an attractive stock for investors seeking both stability and potential in their portfolio. As businesses continue to navigate complex and evolving tax environments, Vertex’s advanced solutions are likely to be in high demand, offering promising prospects for sustained growth and market penetration.

    Verizon Communications (NYSE: VZ) – Connecting With Growth in 5G

    Verizon Communications has recently demonstrated robust performance in the competitive telecommunications sector, particularly with its strategic moves in the fifth-generation wireless space. Following impressive first-quarter financial results that surpassed expectations, Verizon’s stock has shown significant upward momentum, making it a noteworthy candidate for this week’s stock watchlist.

    For Q1, Verizon reported earnings per share of $1.15, outperforming the analyst consensus of $1.12, while maintaining revenue at $33 billion, aligning with Wall Street forecasts. These results have been attributed to Verizon’s innovative approach to customer retention and acquisition, featuring flexible plans and attractive streaming bundles. Notably, these bundles include discounted services from popular platforms like Netflix, enhancing the value proposition to subscribers.

    Furthermore, Verizon reported a decrease in the loss of monthly bill-paying wireless phone subscribers to 68,000 in Q1, a significant improvement compared to the forecasted loss of 100,000 and the previous year’s loss of 127,000 subscribers. This improvement highlights the effectiveness of Verizon’s new “myPlan” option, which offers premium, customizable plans that have resonated well with consumers. The integration of Netflix into these plans towards the end of last year has evidently bolstered subscriber satisfaction and retention.With a year-over-year stock gain of 13%, Verizon is showing that it’s not just keeping pace in the 5G race—it’s setting the pace. The company’s ability to innovate in its offerings and streamline its operations underlines its strong position in a rapidly evolving industry. For investors looking for a stable investment in the telecom sector with potential for continued growth, Verizon offers a compelling opportunity, backed by solid financial performance and strategic customer engagement initiatives.

    Bear Watch Weekly: Stocks to Sideline Now

    By
    Editorial Staff
    -
    0

    The right stocks can make you rich and change your life.

    The wrong stocks, though… They can do a whole lot more than just “underperform.” If only! They can eviscerate your wealth, bleeding out your hard-won profits.

    They’re pure portfolio poison.

    Surprisingly, not many investors want to talk about this. You certainly don’t hear about the danger in the mainstream media – until it’s too late.

    That’s not to suggest they’re obscure companies – some of the “toxic stocks” I’m going to name for you are in fact regularly in the headlines for other reasons, often in glowing terms.

    I’m going to run down the list and give you the chance to learn the names of three companies I think everyone should own instead.

    But first, if you own any or all of these “toxic stocks,” sell them today…

    Celsius Holdings (NASDAQ: CELH)

    This week’s spotlight for caution falls on Celsius Holdings, a notable player in the rapidly growing energy drink sector. Despite Celsius’s impressive financials—boasting a 36.84% year-over-year revenue increase and a 27.38% growth in assets—there are troubling signs on the horizon that potential investors should heed.

    The energy drink market, although projected to expand at an 8.4% CAGR, has been rife with volatility, primarily due to intense competition and regulatory challenges. Celsius finds itself in a precarious position similar to the plight that befell Bang Energy. Currently, Celsius is embroiled in a class action lawsuit over alleged misbranding and selling products without FDA approval, casting a shadow over its operational integrity.

    Given these legal challenges and the inherent market volatility, holding onto Celsius shares might be riskier than it appears. Investors might want to consider divesting from CELH until the company navigates through these legal hurdles and proves its stability in the tumultuous energy drink market.

    Kohl’s Corporation (NYSE: KSS)

    Kohl’s reported a surprising loss of 24 cents per share for the first quarter, a stark contrast to the expected profit of 4 cents per share and last year’s profit of 13 cents per share. With revenue also falling short of expectations at $3.18 billion, down 5.3% from last year, the picture looks bleak.

    The underperformance has been attributed to a decline in consumer spending on discretionary items, influenced by persistent inflation and high interest rates. Further compounding the issue, Kohl’s management has revised its 2024 outlook downwards, now anticipating a sales decline of 2% to 4%, whereas analysts had previously forecasted a modest sales increase.

    Given the significant cut in earnings projections—from an expected $2.34 per share to just $1.25 to $1.85—the stock’s recent gains are under threat. After a previous 12-month rise of 40%, the revised guidance and disappointing quarter have tempered the stock’s annual growth to just 25%.

    Investors may want to consider steering clear of Kohl’s for now, as the revised forecasts and current market conditions suggest potential further downside.

    Snap Inc. (NASDAQ: SNAP)

    Despite Snapchat’s widespread popularity, Snap’s financial performance continues to raise concerns. The company has consistently struggled to achieve profitability, with the lone exception of a modest net income of $23 million in late 2021. This track record places Snap in a precarious position similar to other tech entities like Reddit, which have also faced challenges in monetizing their platforms effectively.

    In Q1 of 2024, Snap reported a 21% year-over-year revenue growth, reaching $1.19 billion. However, this increase in revenue did not translate to profitability, as the company posted a net loss of $305 million, albeit an improvement from the $329 million loss a year prior. More worryingly, Snap’s free cash flow has declined significantly, dropping to $38 million from $103 million in the same quarter last year.

    While Snap has managed to keep its debt levels in check with no debt maturing in 2024, the fierce competition from Instagram and a general plateau in user growth—mirroring early growth trends of platforms like Twitter—suggest that Snap’s path to profitability remains unclear.

    With the stock down 10% year-to-date and significantly below its all-time high, investors might consider avoiding SNAP shares until the company demonstrates a viable plan for sustainable profitability.

    Bear Watch Weekly: Stocks to Sideline Now

    By
    Editorial Staff
    -
    0

    The right stocks can make you rich and change your life.

    The wrong stocks, though… They can do a whole lot more than just “underperform.” If only! They can eviscerate your wealth, bleeding out your hard-won profits.

    They’re pure portfolio poison.

    Surprisingly, not many investors want to talk about this. You certainly don’t hear about the danger in the mainstream media – until it’s too late.

    That’s not to suggest they’re obscure companies – some of the “toxic stocks” I’m going to name for you are in fact regularly in the headlines for other reasons, often in glowing terms.

    I’m going to run down the list and give you the chance to learn the names of three companies I think everyone should own instead.

    But first, if you own any or all of these “toxic stocks,” sell them today…

     Varonis Systems (NASDAQ: VRNS)

    This week’s sell alert focuses on Varonis Systems, a prominent player in the cybersecurity space known for its advanced Data Security Platform. Despite Varonis’s strong product offerings and recent strategic moves, including a notable partnership with Microsoft to secure its Copilot AI chatbot service, there are reasons for investors to proceed with caution.

    While Varonis’s shift towards a SaaS business model is gaining traction—evidenced by a 30% year-over-year increase in SaaS-linked ARR during Q1 2024—the company continues to face profitability challenges. Revenue growth remains modest, confined to single-digit percentages, which is concerning given the current valuation multiples.

    Given these factors, Varonis’s stock might be at risk of a sharp devaluation should market sentiment shift. The stretched valuations coupled with the company’s ongoing unprofitability make VRNS a stock to consider avoiding, at least until clearer signs of accelerated top-line growth and improved profitability emerge.

    Nikola (NASDAQ: NKLA)

    Nikola was once celebrated for its innovative approach to hydrogen fuel cell-powered trucks, but is now more notorious for its struggles. Nikola’s valuation has plummeted, essentially erasing nearly all its market value over the past three years. Currently, it’s trading under a dollar, placing it firmly among penny stocks that cautious investors might prefer to avoid.

    The decline began in earnest following accusations by Hindenburg Research, which claimed Nikola and its founder misled investors. This controversy reached a peak when founder Trevor Milton was sentenced to prison last year, casting a long shadow over the company.

    Under the leadership of CEO Steve Girsky, Nikola aims to generate $150 million to $170 million in revenue this year. However, given the company’s history of unmet promises and a first quarter that missed revenue forecasts, investors should view these projections with skepticism.

    With the stock down and surrounded by uncertainties, NKLA appears to be a risky bet. Investors might consider staying away until Nikola demonstrates clear signs of operational stability and growth.

    CrowdStrike Holdings (NASDAQ: CRWD)

    CrowdStrike Holdings stands out as a top-tier player in the cybersecurity sector, known for its robust cloud-delivered security solutions. Yet, despite its strong fundamentals, caution is warranted with CRWD stock at this juncture.

    Over the past year, CRWD has seen an impressive 100% surge in its stock price, pushing its valuations into potentially precarious territory. Currently, the stock is trading at a forward P/E ratio of 80.7. Such a high valuation suggests there might be substantial downside risk, making it prudent to hold off on new investments until the price becomes more reasonable.

    While CrowdStrike’s financial health remains solid—evidenced by a forecasted EPS growth of 25% next year and a free cash flow of over $1 billion—the stock’s high price-earnings-to-growth ratio (over 3) indicates that the growth potential could already be well-reflected in the current stock price.

    Investors might consider waiting for a more attractive entry point before increasing their stakes in CRWD, as the current market price leaves little room for error. This strategic patience could pay off, especially in a market that rewards prudent valuation assessments.

    Green Gold: Investing in the Cannabis Industry in 2024

    By
    Editorial Staff
    -
    0

    With the marijuana industry projected to grow at a compound annual growth rate of at least 25% through 2030, savvy investors are keenly eyeing opportunities to tap into this green rush. The momentum is fueled by sweeping changes in legislation across the globe, from decriminalization to full legalization of cannabis, opening up a fertile ground for both budding entrepreneurs and established companies to sow their seeds of growth.

    The recent move by the Biden administration to reclassify marijuana from a Schedule 1 to a Schedule 3 controlled substance marks a significant shift in federal policy. This reclassification not only acknowledges the medical benefits of cannabis but also lowers the barriers for research and banking in the industry, potentially unlocking new opportunities and markets.

    Whether you’re just starting to explore the investment potential of cannabis or you’re looking to diversify your portfolio, understanding the nuances of this industry is crucial. Our guide is designed to bring you up to speed quickly, offering insights into the market dynamics, key players, and the regulatory landscape. We’ve handpicked a selection of marijuana stocks that stand out for their growth prospects, innovation, and strategic positioning in the market. Let’s dive into the world of cannabis investing, where the opportunities are as diverse as the strains of the plant itself.

    Innovative Industrial Properties (IIPR): Unlocking Capital for Cannabis Growth

    In the intricate web of U.S. cannabis industry financing, Innovative Industrial Properties (IIPR) stands out as a crucial player. With federal laws keeping traditional banks at bay, cannabis companies often find themselves in a financial bind. Enter IIPR, a real estate investment trust (REIT) that provides a lifeline to these companies through its ingenious sale-leaseback model. By purchasing properties from medical cannabis operators and leasing them back, IIPR injects much-needed capital into these businesses, while securing a steady flow of revenue for itself.

    The strategy has proven to be a win-win, propelling IIPR to own properties across 19 states. Despite the financial hurdles some of its tenants face, IIPR’s growth trajectory remains strong, showcasing impressive revenue and earnings expansion. As a REIT, it’s committed to distributing at least 90% of its taxable income back to its shareholders, making it an attractive pick for income-focused investors.

    While the prospect of federal cannabis reform presents a nuanced challenge for IIPR, potentially increasing competition by opening up traditional banking avenues for cannabis companies, it’s also poised to benefit from the overall market expansion such reforms would trigger. With its shares already trading on the New York Stock Exchange, IIPR is well-positioned to capitalize on the evolving landscape

    Scotts Miracle-Gro (NYSE: SMG) – Cultivating Growth in the Cannabis and Consumer Lawn Sectors

    Scotts Miracle-Gro stands out in the burgeoning cannabis industry, not just for its direct involvement but for its strategic positioning that leverages both the highs of the cannabis market and the steady growth of consumer lawn and garden care. With its shares comfortably listed on the NYSE, Scotts navigates the complex legal landscape of cannabis without stepping over federal lines, thanks to its subsidiary, Hawthorne Gardening.

    Hawthorne Gardening is at the forefront of supplying hydroponic solutions to the cannabis sector, a critical component for cultivators aiming to maximize yield and quality. Despite facing the same supply-and-demand challenges that have temporarily dampened the spirits of the cannabis market, Hawthorne’s long-term outlook remains as promising as ever. The anticipated expansion of the cannabis industry, projected to grow at a compound annual growth rate of 25% through 2030, hints at a vast runway for growth that Hawthorne is well-positioned to capitalize on.

    However, Scotts Miracle-Gro’s story isn’t just about cannabis. The company’s backbone remains its consumer lawn and garden products, which continue to generate the lion’s share of its revenue. This segment of Scotts’ business offers a buffer against the volatility of the cannabis market, providing a steady stream of income even as commodity prices fluctuate. The dual nature of Scotts’ business model not only diversifies its revenue streams but also stabilizes its financial performance, making it a unique pick for investors looking to blend growth with stability in the evolving landscape of marijuana stocks.

    Jazz Pharmaceuticals (NASDAQ: JAZZ) – Pioneering Cannabis-Based Medicines

    Jazz Pharmaceuticals, an Ireland-based powerhouse, has made significant waves in the cannabis sector and beyond, particularly following its strategic acquisition of GW Pharmaceuticals in May 2021. This move not only expanded Jazz’s portfolio but also positioned it as a leader in the development of cannabis-based medicines. Jazz Pharmaceuticals’ flagship product, Epidiolex, has set a precedent as the first cannabis-derived medication to receive FDA approval, offering new hope for patients with severe forms of childhood epilepsy and tuberous sclerosis complex. With sales reaching a robust $736.4 million in 2022, Epidiolex’s success underscores the potential of cannabis in the pharmaceutical industry.

    Beyond Epidiolex, Jazz Pharmaceuticals is actively exploring the therapeutic potential of cannabis with several other drugs in phase 2 clinical trials, targeting conditions such as autism spectrum disorders. This innovative approach to drug development, coupled with Jazz’s established portfolio of sleep-disorder and cancer treatments, paints a promising picture for the company’s future.

    Investors looking to tap into the burgeoning field of cannabis-based pharmaceuticals will find Jazz Pharmaceuticals a compelling addition to their watchlist. With its pioneering spirit and a strong foundation in both cannabis and traditional pharmaceuticals, Jazz is well-positioned for continued growth and success in this dynamic sector.

    Nvidia is Soaring! Here are the Top Alternatives to Ride the Wave

    By
    Editorial Staff
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    0

    The hype around artificial intelligence (AI) continues to drive tech stocks to new heights, with Nvidia leading the charge. But is it too late to jump on the AI bandwagon? Fear not, as we delve into some promising alternatives that offer significant potential for growth.

    Meta Platforms, Inc. (NASDAQ: META): Capitalizing on Double-Digit Growth

    Despite its recent run-up, Meta remains an attractive investment option, according to Adam Coons, portfolio manager at Winthrop Capital Management. With projected revenue growth of 17% this year and impressive earnings per share growth of 35%, Meta’s valuation still appears compelling compared to its peers. Trading at multiples substantially lower than other tech giants like Amazon and Microsoft, Meta presents an enticing opportunity for investors seeking exposure to the AI space.

    Alphabet Inc. (NASDAQ: GOOGL): Monetizing AI through Innovation

    Another compelling alternative to Nvidia is Alphabet, parent company of Google. With a clear path to monetize AI through its advertising platform and subscription services like Gemini, Alphabet is well-positioned to benefit from the ongoing AI revolution. Additionally, Google’s dominance in the Android market provides a unique advantage for implementing new AI features and driving user engagement, further solidifying its position as a key player in the AI landscape.

    Qualcomm Incorporated (NASDAQ: QCOM): On-Demand AI Winner

    As AI continues to permeate various industries, Qualcomm emerges as a standout player in the on-device AI market. With a growing market opportunity across smartphones, PCs, autonomous vehicles, and IoT devices, Qualcomm is poised for long-term success. CFRA Research’s recent upgrade to a buy rating reflects its strong positioning in key growth areas, making it a compelling choice for investors seeking exposure to the AI revolution.

    Micron Technology, Inc. (NASDAQ: MU): Paving the Way for Memory Chip Recovery

    Amidst the AI boom, Micron stands out as a key player in the memory chip industry. Tethered to Nvidia’s graphics processing units and focusing on high-value AI servers, Micron is well-positioned to capitalize on the increasing demand for AI-driven technologies. With the potential for multiple expansion and upside ahead, Micron offers investors an opportunity to ride the wave of AI innovation.

    In conclusion, while Nvidia continues to dominate the AI market, there are plenty of alternatives that offer compelling investment opportunities. From Meta and Alphabet to Qualcomm and Micron, these stocks present diverse options for investors looking to capitalize on the AI revolution.

    Analyst Favorites for June: Where Strong Fundamentals Meet Bullish Technical Signals

    By
    Editorial Staff
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    0

    Following a positive May, several stocks continue to stand out not just for their recent gains but for their strong potential moving forward. Piper Sandler’s analysis highlights a few stocks that excel across various research markers, including favorable macroeconomic conditions, robust fundamentals, and positive chart analysis. These stocks have all earned an ‘overweight’ rating, indicating significant confidence in their potential from the firm.

    M&T Bank (NYSE: MTB) – Banking on Stability and Growth

    M&T Bank has shown a commendable turnaround, reversing a prolonged downtrend to hit a fresh 52-week high on May 15. With a nearly 10% rise in 2024, the regional bank demonstrates solid resilience and growth prospects. Analyst Frank Schiraldi from Piper Sandler points out that M&T Bank has effectively managed its commercial real estate exposure while maintaining a healthy credit outlook, which makes its current discount an attractive entry point for investors. Moreover, Schiraldi highlights the bank’s strategy of leveraging its significant excess capital for aggressive buybacks, enhancing shareholder value.

    Oracle (NYSE: ORCL) – Harnessing AI for Future Growth

    Oracle has also captured attention with an 11% increase in its stock value in 2024. The company is well-regarded for its strong cash flow return on equity and above-average historical EPS growth. Analyst Brent Bracelin notes that Oracle stands to benefit greatly from the burgeoning demand for artificial intelligence, despite its slower start in the cloud infrastructure space. With AI cluster demand significantly outstripping supply, Oracle’s focus on accelerated computing could position it well for future advancements, making its stock an appealing choice for tech-focused investors.

    Tractor Supply (NASDAQ: TSCO) – Leading Retail with Robust Performance

    Tractor Supply has outperformed expectations with a remarkable surge of over 32% in 2024, reaching a 52-week high on May 20. The company is recognized for its exceptional cash flow profitability, which Piper Sandler’s analyst Peter Keith describes as best in class within the hardline and leisure retail segment. The firm’s macro select model identifies Tractor Supply as ideally suited for the current economic environment. Keith also echoes the company management’s outlook that deflationary pressures will be minimal this year, alleviating a significant concern for investors and underscoring the stock’s robust potential.

    Insiders Are Buying These Names Hand Over Fist

    By
    Editorial Staff
    -
    0

    There was notable insider buying in the final days of May, though, from lower-profile executives.

    The biggest move came from two insiders at a small investment firm — Oxford Lane Capital — who combined to buy $50 million worth of the stock. That is a sizeable position for a company with a market cap below $2 billion.

    Elsewhere, the $2.4 million buy from Petco director Cameron Breitner is worth highlighting because Breitner is a senior advisor with CVC Capital Partners, one of the company’s biggest shareholders. This insider activity could indicate confidence in their respective companies’ futures.

    Here are the biggest insider buys, according to securities filings and VerityData:

    Oxford Lane Capital (NASDAQ: OXLC)

    • CEO Jonathan Cohen and President Saul Rosenthal each bought 4.63 million shares at an average price of $5.40 for a total of $25 million.

    FTAI Aviation (NASDAQ: FTAI)

    • CEO Joseph Adams Jr. bought 59,000 shares at an average price of $82.00 for a total of $4.84 million. This reflects shares purchased in an underwritten public offering that closed Thursday.

    Petco Health & Wellness (NASDAQ: WOOF)

    • Director Cameron Breitner bought 750,000 shares at an average price of $3.14 for a total of $2.35 million.

    Agree Realty (NYSE: ADC)

    • Director John Rakolta Jr. bought 20,000 shares at an average price of $59.32 for a total of $1.19 million.

    Claros Mortgage (NYSE: CMTG)

    • CEO Richard Mack bought 160,000 shares at an average price of $7.20 for a total of $1.15 million. Shares were down nearly 17% over the prior three months.

    This insider buying activity might signal strong confidence in the future prospects of these companies. Stay informed and consider how these insider moves might influence your investment decisions.

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