All posts by Bret Kentwell

5 Reasons This Is the Time to Get into Google Stock

Google Stock GOOGL stock GOOG Stock
Source: Shutterstock

Alphabet (NASDAQ:GOOGL, NASDAQ:GOOG) is a behemoth tech company and after the fourth-quarter selloff, investors are wondering if now is the time to buy Google stock. Let’s explore a few reasons why it may be time to pull the trigger.

Balance Sheet

Let’s start with its balance sheet, quietly one of Alphabet’s top assets. While some companies like Apple (NASDAQ:AAPL) have opted to buyback loads of its own stock, Alphabet has let its cash hoard grow and grow. As of last quarter, it has about $106 billion in cash and short-term investments and just under $4 billion in long-term debt.

In other words, Alphabet is sitting on a $100 billion pile of cash. This gives the company staying power in a recession, as well as flexibility to invest in itself or via M&A.

Google Stock Has Assets

Let’s not forget the company’s assets either. Alphabet owns the world’s most popular website, Google.com, as well as the second most-popular website in YouTube.com. Owning those two properties in the internet world is like owning Park Place and Boardwalk in Monopoly.

However, its investments have paid off too. For instance, its self-driving car unit Waymo was valued as high as $175 billion. It owns Android, the most popular smartphone operating system in the world. Its collection of Google assets, Google Drive (think Docs), Gmail, Maps, Chrome, etc., have more than a billion users each.

Growth, Valuation and Google Stock

This next part is a two-part catalyst: Growth and valuation.

For 2018, analysts are calling for sales growth of 23% to $136.5 billion. That goes along with 29.6% earnings growth, with estimates calling for earnings per share of $41.80. In 2019, analysts expect 19% revenue growth to $162.8 billion and earnings growth of 13%.

These are solid numbers from a company this big, with Alphabet toting a market cap of $750 billion.

That said, some investors may balk at its valuation of 25 times earnings. But why? Investors continuously buy shares of Procter & Gamble (NYSE:PG), Walmart (NYSE:WMT), Clorox(NYSE:CLX) and others with P/E ratios near or north of 20 because they’re “safe” plays. That’s despite sluggish growth and pressured margins too.

I don’t have a problem paying 25 times earnings for GOOGL, a blue-chip technology company with the internet’s best assets, strong growth and a rock-solid balance sheet.

Trading GOOGL Stock

chart of GOOGL stock


Click to Enlarge

There are a lot of common-sense reasons to like Google stock, but what do the charts say? Fortunately, investors can still get Alphabet stock at a good price today.

As we have laid out at least a dozen times here on InvestorPlace, GOOGL stock remains a strong buy at the $1,000 level. Since hitting this mark in December, we’re only $85 per share off that level. If investors are debating a long-term position in Alphabet, I wouldn’t hesitate to initiate a position on a slight pullback here. That’s even with earnings coming up in early February.

Shares are riding short-term uptrend support higher (black line) and are back above the 50-day moving average. Remember, GOOGL stock has a 52-week high near $1,300.

The way the stock is bouncing between $1,200 and $1,000 does make me a little hesitant (green and red circles). That said, this is a long-term winner and I do not bet against GOOGL over the long-term.

Bret Kenwell is the manager and author of Future Blue Chips and is on Twitter @BretKenwell. As of this writing, Bret Kenwell is long AAPL and GOOGL.

Source: Investor Place

Will Aurora Cannabis Be Next to Secure a Big Partnership?

There’s a rush for companies to get exposure to the cannabis industry and it has left many wondering what company will be next. Will it be Aurora Cannabis (NYSE:ACB) and its $5.3 billion market cap?

At that valuation, that’s smaller than some of the more well-known players like Tilray(NASDAQ:TLRY) and Canopy Growth (NYSE:CGC), but larger than Cronos Group(NASDAQ:CRON) and New Age Beverages (NASDAQ:NBEV). Following a string of partnership and equity stakes, it’s unlikely that the deals are going to stop. With the cannabis space growing rapidly, there’s no reason for larger companies seeking growth to ignore the space.

In fact, it’s a match made in heaven. Many of these companies — ranging from pharmaceutical to alcohol and tobacco companies — already have experience navigating a sea of regulations. They also have the financial muscle to leverage these opportunities, as well as the distribution network in place to take advantage of it.

Is a Deal Next for Aurora?

Canopy Growth received a $4 billion investment from Constellation Brands (NYSE:STZ) and Altria (NYSE:MO) sunk $1.8 billion into Cronos. Tilray grabbed a deal with Sandoz, a unit of Novartis (NYSE:NVS), and also locked into a $100 million partnership with Anheuser-Busch(NYSE:BUD).

To think that the deals will stop there is crazy. Obviously we don’t know who will step in next, when they’ll do it or which cannabis partner they’ll select. But at some point, I wouldn’t be surprised to see ACB have its name called.

The tough part here becomes valuation and momentum. Think if alcohol were illegal, but the world (and more specifically the U.S.) were trending toward legalization. We would want a piece of the action, right? Names like Bud, Molson (NYSE:TAP), Diageo (NYSE:DEO), etc., would come to mind. But if everyone had the same thought and started buying ahead, would it still be worthwhile to get in, particularly as other big-name companies — say PepsiCo (NYSE:PEP) and Coca-Cola (NYSE:KO) for instance — were doing it too?

Depending on one’s time frame, then yes, it’s probably advantageous. But no one wants to hold onto a dead-money investment for years on end. So we have to try to balance these companies’ current valuation with their future opportunities.

Trading ACB and Valuing Its Growth

Aurora is experiencing strong growth. In the fourth quarter of 2018, sales came in at $19.1 million. In Q1 2019, sales ballooned 55% quarter-over-quarter to $29.7 million and grew 260% year-over-year. Put simply, the growth for ACB stock and many other cannabis companies is simply astronomical. It’s a gold rush, if you will.

That said, expenses are growing quickly too. Production jumped more than 100% year-over-year, while operating costs of $119.9 million last quarter were vastly higher than the $10.2 million in Q1 2018. While gross margins of 70% were down from the 74% in Q4, it’s up significantly from the 58% in Q1. That’s likely as larger volumes and more efficiencies drive stronger bottom-line results.

Still, I understand investors’ hesitancy to get long a name at a $5+ billion market cap when it has $30 million in quarterly sales. Certainly ACB and others are not for everyone and I would only consider it a speculative position. That said, cannabis acceptance is only gaining momentum over time and that’s likely to remain the case going forward.

chart of ACB stock price

What do the charts look like?

Unfortunately, unlike the cannabis movement, ACB stock is not gaining momentum. I would like to see ACB get back over $5.50, clearing level support (black line) downtrend resistance (purple line) and the 21-day moving average.

Investors who want a low-risk entry opportunity can buy on a test of uptrend support (blue line), but right now, I need the technicals to play ball. If not, getting bullish is too hard in this environment given the high valuation.

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Source: Investor Place 

2 Important Levels to Watch for Nvidia Stock

Nvidia Stock NVDA stock

Source: Shutterstock

Shares of Nvidia (NASDAQ:NVDA) have been hammered since the start of October. The rout in Nvidia stock pained a lot of long-term investors and shaken out, or caused severe losses for, a lot of recent buyers.

NVDA stock suffered a 50% decline in just 35 trading sessions from its early-October highs. Others, like Advanced Micro Devices (NASDAQ:AMD) have fared better, but have also been under pressure.

Despite the beating, Nvidia’s stock price is more a case of a broken stock than a broken company. Admittedly, it has a few issues, but they are more temporary than anything else and it still has several secular tailwinds at its back.

Evaluating Nvidia Stock

Current estimates call for 50% earnings growth this year and nearly 26% sales growth. However, those estimates drop considerably next year, calling for flat earnings growth and just 6% revenue growth. Now, inaccurate estimates can hurt both the bulls and the bears here, but consider how far off analyst estimates were for the upcoming quarter.

Management guided for $2.7 billion in Q4 sales, way below expectations for $3.4 billion. With that kind of miss, we can’t rule out that revenue could come under further pressure through the year. We also can’t rule out that analysts cut their estimates too much over the next five quarters.

That said, Nvidia has its share of issues. Mainly there was a false sense of demand for graphics chips thanks to cryptocurrency mining. Even though Nvidia had crypto-specific options, these miners were using all the chips they could get their hands on. That led to management, analysts and investors believing that demand was much strong than it really was. Once that crypto-fueled demand faded, it left NVDA with a glut of inventory, which will hurt business over the next few quarters.

For short-term investors, that likely takes Nvidia stock off their watchlist. For long-term investors though, that opens the door to opportunity. Nvidia is still a leading force in the artificial intelligence revolution and its new ray-tracing technology is unrivaled. It has solid growth in gaming and monstrous growth in the datacenter. Its professional visualization segment is no slouch and while small now, its automotive unit continues to churn out impressive growth, too.

Trading NVDA Stock

chart of NVDA stock price
Click to Enlarge 
Trading at 21 times this year’s earnings isn’t expensive when we have 50% growth. However, with flat growth next year, that valuation may concern some investors.

When in doubt, I side with the company’s quality, which is top notch. Further, my outlook for Nvidia stock isn’t the next five to eight quarters, it’s the next five to eight years.

With that said, the valuation is only part of the equation. What do the charts say?

Nvidia stock has been locked in a costly downtrend that it’s still not out of. That sets up the first level we need to watch. Over the 21-day moving average and downtrend resistance, and NVDA stock may be able to get some bullish momentum.

If it can, look to see if it can hurdle its November high and make a push back to $194. At that level, Nvidia will fill its earnings gap and hit its 38.2% Fibonacci retracement level from the October highs to the November lows (that’s also the 2018 high/low range).

The other level to watch comes on the downside. Specifically, let’s see how Nvidia does in this $140 to $145 level. Although it shot below it last month amid its post-earnings pummeling, it’s been serving as a level of stability for the name.

If it can hold up there, long-term investors may add to their position. Should it fail as support, the $134 lows are in play. Below that and perhaps $120 becomes possible, a big breakout level in 2017.

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7 Dividend Titans Trading Like Growth Stocks

Source: Steve Buissinne via Stock Snap

Investors are often on the lookout for a fourth-quarter swoon starting in October. Sometimes it comes to fruition and other times it does not. This year though, it most certainly has and the volatility has lasted about two months. It’s left investors fleeing growth stocks, gobbling up dividend stocks and looking for shelter.

And we may not be out of the woods yet. That’s particularly true if the trade situation with China doesn’t improve. The White house had announced a trade war cease fire after a meeting at the G-20 summit, though the exact details of the agreement are not entirely clear.

It helps that the Federal Reserve is walking back its rate-hiking outlook. Investors are feeling more comfortable that the Fed will not hike us into a recession, although skepticism remains.

Even though GDP is growing nicely, consumer spending is red hot and unemployment is low, the stocks that are outperforming are all ones we’d want to own during a recession. That’s not a great development, particularly as investors dump FANG and multiple sectors into bear market territory.

It has been an ugly showing to say the least, but can we get back on the right track? Let’s take a closer look at a few dividend stocks trading like growth stocks.

Johnson & Johnson (JNJ)

Dividend Stocks: Johnson & Johnson (JNJ)

Source: Shutterstock

Dividend Yield: 2.5%

Johnson & Johnson (NYSE:JNJ) did stumble from over $138 to $132 in early October, but it didn’t take long for investors to find comfort in this long-time dividend stalwart.

Johnson & Johnson pays out a 2.5% dividend yield, has a payout ratio below 50% and has raised its annual payout for 56 consecutive years. When the economy falls on hard times, it’s hard not to like a consistent payout like that.

With JNJ, we get a rock-solid balance sheet and a dividend we know we’ll collect. On the charts, we were buyers last week on a test of the 50-day moving average. That proved to work out well, with shares quickly bouncing from this level.

But can they work their way up and past the recent high near $148? If JNJ can’t do that, we’ll have a lower high on our hands and will have to see if uptrend support (blue line) can keep it afloat. Below $140, JNJ losses a bit of its luster.

McDonald’s (MCD)

Dividend Stocks: McDonald’s (MCD)

Source: Shutterstock

Dividend Yield: 2.5%

Some fast-food and fast-casual names have been on fire and McDonald’s (NYSE:MCD) is no exception.

Yielding a similar payout of 2.5%, McDonald’s has raised its annual payout for more than four decades. It’s another name that does well during a recession. Part of that is the dependable yield, the other is a dependable (although not necessarily healthy) burger.

Further, its stock has been dependable too. While Amazon (NASDAQ:AMZN), Netflix(NASDAQ:NFLX) and Apple (NASDAQ:AAPL) have all fallen by 20% or more from peak to trough, MCD is quietly up about 10% from the beginning of October.

It’s outperforming its peers, major market indices and most equities during the last eight weeks. This one has been on fire, clearing its previous all-time high near $175 made in January before settling back a little on the latest bout of market weakness.

The tough part with McDonald’s is, what happens if growth stocks come back to life?

So long as it’s over the 21-day moving average and uptrend support, I don’t see a reason to get too defensive. Fall below that mark though, and this play could lose some momentum. Long-term investors don’t have much to worry about, but short-term traders hiding out in this dividend stud might want to think twice if it goes below this level.

Coca-Cola (KO)

Dividend Yield: 3.2%

Coca-Cola (NYSE:KO) is another one showing signs of exhaustion. While the company has done a great job to transform itself over a multi-year effort, one has to wonder how long the show can go on.

Despite the roughly 6% rally over the last two months — tepid compared to MCD — Coca-Cola shares still yield 3.2%.

Earlier this month we suggested some covered calls for investors who are comfortable with that options strategy. As we see shares pulling back and stagnating in this upper-$40s area, that trade is playing out well.

But what do investors do now? This stock has been in a narrow trending range over the last five years. While KO did flirt with a breakout of this range, it’s still within it now. Coca-Cola has held up too well over the past two months to consider bailing on it on a whim. On a decline, look for $46 to keep big KO afloat. Above $50 and look for this one to keep on chugging.

Procter & Gamble (PG)

Dividend Stocks: 3.1%

Like KO, the turnaround efforts are working for Procter & Gamble (NYSE:PG) — at least, they’re working for PG stock.

Even after accounting for a notable dip in early October, shares of Procter are still up 17% over the last eight weeks. It’s hard to complain about that kind of performance, particularly as investors continue to collect a 3.1% dividend yield.

This name has not only dished out a dividend for more than 60 years, but also raised its annual payout each year through that span. That’s incredible when you think about it.

With that said, Procter & Gamble is putting in the same lower-high look that JNJ is. Of course, that move would be negated if PG stock can soon rally to take out its highs from earlier this month. If not though, investors have to be thinking about a slight to moderate pullback.

On a decline, look to see how PG holds up near $90. This level acted as resistance back in January 2018 and December 2017. Look for it to now act as support. Further, uptrend support  is just below this mark. I wouldn’t worry too much (from a trading perspective) unless PG fell below the 50-day.

Verizon (VZ)

Dividend Stocks: Verizon (VZ)

Source: Shutterstock

Dividend Yield: 4.2%

Also a “lower high” candidate, Verizon (NYSE:VZ) is chopping around near its highs.

My gut tells me that the next few weeks could either be an acceleration higher for these dividend names or a rotation out of these stocks and back into traditional growth stocks. Which one it will be, I’m not sure. These “lower highs” show investors’ hesitation in the charts as well. Ultimately, the performance of the major indices will likely be the deciding factor.

Despite Verizon’s roughly 13% rally over the last two months, shares still yield about 4.2%. In that time, the 50-day moving average has become a pretty solid indicator of support.

Should it fail, look for a decline into the mid-$50s, down near the $56 level.

If you’re not in VZ, I would wait for this potential pullback to materialize. In the meantime, consider going long AT&T (NYSE:T). It has a much larger yield at 6.5% and has raised its dividend for 33 consecutive years (triple the length of Verizon). Plus, it just laid out a promising roadmap for its earnings and free-cash flow for 2019.

Plus, its dividend is almost never this high.

PepsiCo (PEP)

Dividend Stocks: PepsiCo (PEP)

Source: Shutterstock

Dividend Yield: 3.2%

Have I said “lower high” enough? By now I’m sure you’re getting the picture. Long-term investors shouldn’t worry about it too much, but short-term traders should consider the possible rotation ramifications here.

But as they say on Wall Street, the trend is your friend until it bends. With PepsiCo (NYSE:PEP), there has been no such bend. We were buyers during its May decline and that move has paid big dividends — no pun intended.

Holding up over the 21-day moving average and uptrend support, this 3.1% yielder has been trading incredibly well. Below these levels and we likely get a dip down to the 50-day moving average. Below that and we’ll likely see the 200-day. That said though, I don’t anticipate this chart falling apart anytime soon.

If anything, I’m looking for a breakout over this $118 to $120 range. Same with Coca-Cola? Now that’s something to ponder.

Realty Income (O)

Realty Income (O)

Dividend Yield: 4.1%

As if the first six names on this list weren’t an obvious indicator, the performance by Realty Income (NYSE:O) and other REITs is a major sign that investors are seeking high-quality income.

Why? Because even with a more hawkish Fed, investors are flocking to real estate. That’s right. The same worry that took these names down big in Q4 2017 and gave them a major hangover to start 2018 is now seemingly absent from investors’ minds.

As we worry about further rate increases, REITs like Realty Income continue to grind higher. Of course, when we zoom out it makes more sense. With rising rates comes a stronger economy and with a stronger economy comes better performance from businesses, which are the tenants to companies like O.

They don’t call O “The Monthly Dividend Company” for nothing, either. Still yielding over 4.1%, this dependable company has been depositing rising “rent” checks in investors’ pockets for more than 20 consecutive years.

Its stock price has been showing similar dependability as of late and we sure are glad we were pounding the table on this name (and two others) back in the summer. O stock is now up about 16% over the last eight weeks. Can it keep pushing?

The hope is that it can pierce through this level and hold onto at least $63 to $64 as support. Given its hot run through and with a rate hike likely looming in December, a decline down to the $60 area wouldn’t be surprising (or unhealthy).

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Source: Investor Place 

Is Aurora Cannabis the Best Pot Stock to Buy Now?

You Can Do so Much Better in the Pot Sector Than CRON Stock

Source: Shutterstock

There’s no sugar coating it: Cannabis stocks have had a tough ride in the second half of October. Collectively, the group was hammered as the overall markets took a hit. Surprisingly though, many cannabis names held up fairly well — Aurora Cannabis (NYSE:ACB) included.

That’s as recreational marijuana became legal in Canada in mid-October. Several stocks broke out just ahead of the event, only to reverse lower and join the major selling theme of the market. It set up as one great sell-the-news event, something we weren’t surprised about when we looked at Canopy Growth (NYSE:CGC) earlier in the month.

With many cannabis stocks making major moves lower, it no doubt brought some investors back to the table. They want to know, is it time to buy cannabis stocks, and specifically, is ACB stock a good one to buy?

Valuing Aurora Cannabis Stock

The company’s growth is actually pretty solid, with ACB stock racking up $55 million in sales for fiscal 2018, which ended on June 30. That was a tripling from the prior year’s $18 million in sales.

While that’s great from a sales perspective, I worry about cost control in getting to that point. For instance, cost of goods sold (COGS) increased nearly 6-fold, from $2 million to $11.7 million. SG&A expenses swelled from $17 million to $72 million and total operating expenses increased from $27.7 million to $135.3 million.

Because of “other income” on the income statement, it skews net income to the positive side, implying the company earned almost $72 million last year. On the surface, that looks like 46% net profit margins, but that’s not the case by any means. So investors need to be aware of that before they take these surface numbers at face value.

Between 2017 and 2018, total debt went from $63 million to over $200 million while total cash went the opposite direction, from $159 million to $89 million. However, current assets of $219.7 million do trump current liabilities by quite a bit, with the latter standing at $75.1 million.

So where does that leave us? With ACB stock commanding $6.7 billion market cap, it’s not cheap. Coca-Cola (NYSE:KO) has said it’s out as a buyer or partner to the industry right now, but could PepsiCo (NYSE:PEP) be into cannabis? How about other alcohol giants like Boston Beer(NYSE:SAM), Molson Coors (NYSE:TAP) and others, the way Constellation Brands(NYSE:STZtook a massive stake in Canopy Growth?

For me, Canopy is the “surest” bet in the business and that’s why if I had to bet on one, it would be with them. But that doesn’t mean others can’t buy or take stakes in ABC, Tilray(NASDAQ:TLRY) and others.

Trading the ACB Stock Price

chart of ACBFF stock
Click to Enlarge

Even before the legalization pop in mid-October and even after the bounce from sub-$6 a few days ago, ACB stock is still down from early October. So where does that leave us?

Since it’s bumping into the underside of the 100-day and 200-day moving average, now may not be the best time to go long Aurora Cannabis if you are bullish. However, I would feel more comfortable stepping into this name in the mid-$5 range.

From there, the risk-reward is much, much better. First, there’s the backside of downtrend resistance (blue line), which has been significant over the past year. There’s also uptrend support (purple line) and a notable level of support between $5.50 and $5.75. Losing all three levels would be a sign that investors need to bail on their long position. Above all three major moving averages and the $10 mark is back in sight.

Thus, there is attractive risk/reward between $5.50 and $6.

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5 Hot Stocks Today (That Could Crash Tomorrow)

Source: Shutterstock

Let’s admit it. We’re all fascinated by the stock market’s hot stocks, aren’t we? That doesn’t mean we’re adrenaline junkies hopping from bandwagon to bandwagon. But it can be mesmerizing to see a stock double, triple or quadruple in a short period of time.

While we’re on the topic then, we’re all on the hook for owning some real duds too, right?

So we wanted to combine the too and look at some hot stocks that could have the potential to be duds in the future.

By “duds” we don’t necessarily mean bankrupt or stocks that are heading to the over-the-counter exchange. Rather, we’re looking for stocks that are hot now but might cool off.

Hot Stocks For Now: Bausch Health (BHC)

hot stocks to fall -- BHC

It was probably a good idea to change its name from Valeant Pharmaceuticals to Bausch Health Companies (NYSE:BHC) given the former’s fall from glory. Shares went from more than $250 to below $10.

It’s actually been pretty hot, despite BHC carrying a tainted reputation. With a 52-week high of almost $28 though, shares have nearly tripled from their one-year lows.

The latest quarterly results inspired some confidence with an earnings and revenue beat. However, I’d be leery of the name still. Revenue fell 13% year-over-year (YOY), while net income dropped more than 33%. Operating cash flow decreased as well.

But let’s give credit where credit is due. After once carrying ~$30 billion in long-term debt as of year-end 2016, BHC has since cut that figure down to $25.25 billion. It’s a decent reduction and proof that management is at least trying to turn things around.

However, with just an $8 billion market cap, we’re still talking a lot of leverage and overhang here. Those who hate on Tesla (NASDAQ:TSLA) should realize it has a $55 billion market cap and “just” $11 billion in debt.

Hot Stocks For Now: Bitcoin Investment Trust (GBTC)

hot stocks to fall -- GBTC

I know what you’re thinking, “The Bitcoin Investment Trust (OTCMKTS:GBTC) has already fallen a ton!”

That’s true, as GBTC topped out around $35 back in December. Of course, it’s no surprise that that’s when bitcoin also hit its top, given that the GBTC tracks the price of bitcoin. While GBTC could soar should the cryptocurrency regain its momentum, investors should be leery of its near-50% rally over the past few weeks.

For starters, bitcoin has been highly volatile and under a lot of pressure so far this year. Bulls can make a case for owning it, but the GBTC shouldn’t be a way to do it. This fund trades at a more than 50% premium to its net asset value (NAV).

What does that mean? The price of the fund, which charges a way-too-high 2% annual management fee, trades at a 52.7% premium to the current bitcoin price. Were the fund to liquidate, its value would plummet.

Sorry crypto lovers, I’m not a buyer of GBTC.

Hot Stocks For Now: Fossil (FOSL)

hot stocks to fall -- FOSL

Man, Fossil Group (NASDAQ:FOSL) has been on fire. The company has gotten its act together a bit and has been cutting down debt. But does it warrant a 500% rally?

Within the last 12 months, shares traded for as low as $5.50. Fossil stock recently topped out near $32 just last month and the 50-day moving average is acting as support as we speak. Trend-line support is also in play.

Look, I’m not saying I’d lever up on a short position in FOSL, but I would be questioning the run. The company is expected to lose money this year, before earning just 37 cents per share in 2019. That means FOSL stock trades for more than 70 times next year’s earnings. Further, sales are expected to decline this year and next year.

Fossil also does not pay a dividend.

It’s no wonder momentum traders are sticking with FOSL. The stock has the wind at its back and it’s a low-market-cap stock that’s easy to push. That said, I’d look for more quality investments for long-term holders.

Hot Stocks For Now: Netflix (NFLX)

hot stocks to fall -- NFLX

Netflix (NASDAQ:NFLX) is certainly a controversial pick for this article. This FANG stud has outperformed Facebook (NASDAQ:FB), Amazon (NASDAQ:AMZN) and Alphabet(NASDAQ:GOOG, NASDAQ:GOOGL) this year and over the past 12 months. It’s taking over the world with its streaming platform and is disrupting one of the world’s largest industries.

So this isn’t to say load up a short position or don’t ever buy it. But it’s important to point out its flaws.

The stock is still up a whopping 132% over the past year and an insane 95% so far in 2018. However, on Monday Netflix reported quarterly results. Despite beating on earnings, it missed on revenue estimates. Even worse, second-quarter subscriber growth was worse than expected — far worse, actually.

That follows four straight quarters of obliterating subscriber expectations. This isn’t a case of analysts getting overzealous either. The guidance from Netflix management was similar to consensus estimates too. Even worse though? Management’s guidance for third-quarter subscription growth was well below expectations too.

At first, NFLX paid the price, down 14% in early trading following the results. But investors immediately bid up the stock, dismissing the miss-and-miss on estimates and guidance.

So what gives? Bulls used to argue that the story isn’t about earnings or cash flow right now. Instead, it’s all about subscriber growth. That’s what fueled shares higher more than 100% on the year, despite Netflix spending half of its expected revenue on content in 2018.

Now that subscriber growth is disappointing, we’re what, going to buy the dip again?

Maybe so. But Netflix just showed some cracks, even though the stock’s not acting like it. Maybe this is the wrong gut feeling to have, but I wouldn’t be surprised to see NFLX revisit its recent lows.

Hot Stocks For Now: Riot Blockchain (RIOT)

hot stocks to fall -- RIOT

Riot Blockchain (NASDAQ:RIOT) thought it could change its name to something crypto and it would solve all of its problems. Unfortunately, some investors surely got taken for their money, as shares ran from ~$3.50 to more than $45 between August and December 2017.

Even worse, its CEO unloaded more than 30,000 shares near $28 in December too.

Some may dismiss Riot being on this list because it’s related to blockchain and crypto. They may argue ignoring it near $6 is a crime in itself. I am not one of those believers though, at least when it comes to RIOT.

While the stock fell 9% on Wednesday, it follows a near-40% one-day rally earlier this week. The technicals are still terrible, the company trades at a laughable 65 times its 2017 sales and makes no money.

So do you short this work of art? Of course not. Because a rally — however ridiculous it may seem — could more than double the stock. We’re looking for quality stocks to own, not lottery plays at the casino.

And some may wonder, “how is this a hot stock that could become a dud,” especially when RIOT has gone from $30 to $6 in the last seven months? Because it’s up 40% this week and its 52-week lows are still far below current levels.

Admittedly, a bitcoin rally could heat up RIOT. But if you want exposure, just stick to crypto.

Get up to 14 dividend paychecks per month from safe, reliable stocks with The Monthly Dividend Paycheck Calendar, an easy-to-use system that shows you which dividend stocks to pick, when to buy them, when you get paid your dividends, and how much.  All you have to do is buy the stocks you like and tell them where to send your dividend payments. For more information Click Here.

Source: Investor Place

7 Top S&P 500 Stocks to Consider for Long-Term Gains

Source: Shutterstock

The S&P 500 is an index containing the largest stocks in the country. Investors use it to gauge how stocks are doing overall, as it serves as a snapshot for the U.S. equities market. Generally speaking, the index is also used as a benchmark, as everyone from retail investors to hedge fund managers compare their performance to it.

With that being said, there are a lot of names in the S&P 500 that investors don’t want to own, simply because they are not performing well. Do you know how unlikely it is to consistently get 500 winners?

In that regard, let’s take a look at how investors can use key stocks held in the S&P 500 to build a winning portfolio over the long term.

Top S&P 500 Stocks to Own: Nvidia (NVDA)

Top S&P 500 Stocks to Own: Nvidia (NVDA)

Perhaps Nvidia (NASDAQ:NVDA) is too obvious a stock to name here. But given its large rally over the past year, many investors feel like they’ve missed the boat.

Admittedly, Nvidia stock has rallied impressively over the past few years, up 53%, 379% and 1,157% over the past 12, 24 and 36 months, respectively. While another 1,000% rally in the next few years is likely out of the cards, there could still be substantial upside in Nvidia. For instance, the stock reaching over $300 in the next six to 12 months isn’t out of the question.

The company has positioned itself as a market leader in a number of secular end markets. Nvidia’s work in artificial intelligence (along with its numerous subcategories like deep learning and machine learning), in gaming chips and in the datacenter is all very impressive. Finally, it would come as a shock if Nvidia wasn’t the biggest winner from the autonomous driving race. While automotive revenue isn’t clocking in with massive growth right now, the self-driving industry is still in the very early innings. As it gains tractions, Nvidia’s DRIVE platforms will play a massive role in the industry.

While Nvidia may trade at 14 times sales, keep in mind it has far better margins than Advanced Micro Devices (NASDAQ:AMD) or Intel Corporation (NASDAQ:INTC). On an earnings basis though, Nvidia’s valuation is much more reasonable. At just 34 times this year’s earnings, that’s not much of a premium for a big-time grower like NVDA.

Analysts expect 34% sales growth this year and 50% earnings growth. While those numbers slow significantly in 2019, my guess is that they’re too conservative. Nvidia hasn’t just topped earnings estimates over the last few years — it has crushed every quarter. Its story isn’t done yet.

Top S&P 500 Stocks to Own: Apple (AAPL)

Top S&P 500 Stocks to Own: Apple (AAPL)

Apple (NASDAQ:AAPL) isn’t very controversial, but it needs to be included.

It’s the largest company in the S&P 500 and for good reason. Apple’s products and brand have made it so millions of customers around the world don’t even consider owning a competing brand. So long as it continues to make a sticky ecosystem, business should continue to do well.

Having a $100 billion buyback shows just how strong those cash flows are each quarter. Impressively, this follows previous buyback plans that ran into the tens of billions as well. More than likely, it comes ahead of many more billions being plowed into future share repurchases. Warren Buffett has made Apple the largest position in his Berkshire Hathaway (NYSE:BRK.A, NYSE:BRK.B) holdings as well.

Apple also pays out a decent dividend, yielding 1.5%.

While shares are near the highs and as its market cap gravitates toward $1 trillion, it’s still one investors should have on their radar. Perhaps use a market-wide correction to initiate a new position.

At 18.5 times this year’s earnings, Apple stock is reasonably priced given its size and status. It’s also reasonable given its growth, even though on its own historical averages, it’s not exactly cheap. Analysts expect sales to grow 14% this year and 4% in 2019. On the earnings front, estimates call for 25% growth this year and 15% growth next year.

Don’t forget about the company’s budding services revenue, which could be a standalone company at this point. Last quarter its $9.2 billion in sales grew 31% year-over-year and came in vastly ahead of analysts’ expectations of $8.4 billion. If that momentum continues, it will help drive AAPL stock higher.

Top S&P 500 Stocks to Own: 3M (MMM)

Top S&P 500 Stocks to Own: 3M (MMM)

3M (NYSE:MMM) hasn’t had the easiest time lately. But I think its business, chart and dividend make it one that certain investors should consider.

For starters, 3M made our list of best dividend stocks just this week. The company has not only paid out a dividend for a whopping 60 years, but it’s also raised its dividend every year for six decades. For income investors, there’s not much more you can ask for in terms of consistency. (The top dividend-payer only has three more years than  3M).

As for its business, estimates call for 5.7% sales growth this year and 3.5% next year. That goes along with 13% earnings growth in 2018 and 9% in 2019. For this, investors are paying about 18 times earnings.

Some will point out that they can buy Apple for a lower valuation with better growth and that’s true. 3M isn’t for all investors. But a look at the charts tells us we have a solid risk/reward opportunity here. Should MMM stay above downtrend resistance near $200, it could mean shares have finally bottomed.

This $190 to $195 area has clearly been support. If 3M can gain some upside traction, it could be attractive going into the second half of the year. Keep in mind, this stock topped out over $250 earlier this year.

Top S&P 500 Stocks to Own: General Motors (GM)

Top S&P 500 Stocks to Own: General Motors (GM)

General Motors (NYSE:GM) may not be a name many would have expected, but the automaker doesn’t seem to get enough credit. With a dividend yield of nearly 4% and trading at 6.2 times next year’s earnings, GM stock is at least one to take a deeper look at.

Admittedly, the automaker does not boast great growth. Analysts expect revenue to grow just 40 basis points this year and 50 basis points next year. On the earnings front, they expect a 3% decline in 2018 and a 0.5% gain in 2019. I find that the expectations for a 3% decline may be a bit aggressive, but either way even if GM reports flat growth, it’s still rather unremarkable.

The stock recently ran from $37 to $45 in just a few days time. That was after SoftBank(OTCMKTS:SFTBY) took a near-20% stake in Cruise Automation, a company that GM bought for roughly $1 billion two years ago.

Based on the deal, that gave an $11.5 billion valuation to Cruise. In other words, GM owns a majority stake in what is now a highly valued asset. Buy low, right? However, despite GM rallying significantly after the SoftBank deal was announced, it’s now falling back down to $39.

That could give investors a great opportunity to get long the automaker at a low valuation and collect a big dividend while they wait. GM can be a big player in the autonomous driving movement, with RBS analysts predicting that it could become a $43 billion enterprise for GM by 2030.

It’s also worth noting is that GM currently has a market cap of $56 billion.

Top S&P 500 Stocks to Own: JPMorgan (JPM)

Top S&P 500 Stocks to Own: JPMorgan (JPM)

JPMorgan Chase (NYSE:JPM) beat on earnings and revenue estimates last Friday. Before that, the bank passed its Fed stress tests and gave a big boost to its capital return plans.

The bank is boosting its quarterly payout to 80 cents a share, up from 56 cents per share before the stress test results. In other words, JPM gave a 43% boost to its dividend and now yields about 2.9% annually. The bank can also buy back almost $21 billion over the next 12 months.

These positive catalysts are beginning to give JPM stock a boost, as shares crossed a vital level on Monday.

Even better, JPM’s valuation and growth profiles are attractive.

Analysts expect revenue to grow 7% this year and another 4% next year. On the earnings front though, estimates call for around 30% growth this year and another 8% growth in 2019. Given that JPM trades at just 16 times this year’s earnings, it makes it mighty attractive.

Top S&P 500 Stocks to Own: Delta (DAL)

Top S&P 500 Stocks to Own: Delta (DAL)

We recently took a closer look at four airline stocks investors might want to buy. Like Apple, the four largest U.S. airline stocks are all owned by investing legend Warren Buffett. Their low valuation, strong cash flow generation and capital return make them attractive. Plus, air travel is becoming more popular than ever.

One to consider from the group is Delta Air Lines (NYSE:DAL). Check out this piece to see our simple table comparing all four names.

While Delta didn’t lead any specific category other than dividend yield, it scored high enough in each measure to be considered one of the best. The company boasts respectable revenue growth and double-digit earnings growth this year and next year.

Paying out a 2.7% dividend yield now, buying back plenty of stock and trading at less than 16 times this year’s earnings makes it too attractive to keep off the list. Unlike some other airline stocks, DAL stock is holding support too.

Now, it just needs to get through $51 and then a 10% rally is in the cards.

Top S&P 500 Stocks to Own: Vanguard S&P 500 (VOO)

Top S&P 500 Stocks to Own: Vanguard S&P 500 (VOO)

I don’t want investors to mistake this article for a Warren Buffett rah-rah piece. But despite his humble approach, it’d be insulting to consider him anything less than an investing king at this point. Whether it has been his investments from three decades ago or how he stepped into the banks during the Great Recession, he will be remembered for eternity. (Well, probably).

In any regard, his top advice for individual investors is to invest in low-cost index funds for the S&P 500. When held over very long stretches, these investments have worked out wonderfully for investors. Throw in the low fees and the returns are better than most individual investors can muster on their own. For instance, the Vanguard S&P 500 ETF (NYSEARCA:VOO) is up 14% over the past year and 32% over the past three years.

While there’s a lot of stocks that have outperformed that and many on this list have done so, there are also plenty of duds that haven’t.

It doesn’t have to be an “either-or” situation though. Investors can use something like the VOO for a core position and, say, a few names on this list to build around it. That way they have the best of both worlds.

Get up to 14 dividend paychecks per month from safe, reliable stocks with The Monthly Dividend Paycheck Calendar, an easy-to-use system that shows you which dividend stocks to pick, when to buy them, when you get paid your dividends, and how much.  All you have to do is buy the stocks you like and tell them where to send your dividend payments. For more information Click Here.

Source: Investors Alley 

 

5 Top Stock Trades for Wednesday Morning

On Monday morning, investors came out strong and bought the trade-war dip. On Tuesday, it took more convincing, but bulls reluctantly bid U.S. equities off their lows. I don’t know how much longer they can handle it though and if trade talks intensify, U.S. stocks look likely to head lower. That’s why on days like this, I like to look for strength, which you’ll see in our top stock trades below.

Top Stock Trades for Tomorrow No. 1: Netflix (NFLX)

Top Stock Trades for Tomorrow No. 1: Netflix (NFLX)

 

Talk about a juggernaut — Netflix, Inc. (NASDAQ:NFLX) has powered higher again on Tuesday, now up more than 3% and above $400. Thought you could get this on a pullback? Well think again, apparently.

Shares are now up a laughable 110% this year and more than 160% over the past 12 months. FANG is hanging tough amid the selling too, with Amazon.com, Inc. (NASDAQ:AMZN) racking up another all-time high on Tuesday as well.

So what do investors do with NFLX? For the love of God, please don’t short the thing. We’ve preached over and over not to short strength and this is a perfect example as to why, regardless of the valuation.

We were all over the breakout in late-May and props to those who are still riding it. $400 is a significant level, but with this high of an RSI (green circle) and after this big of a run, new buyers have to wait for a pullback or some consolidation first.

Top Stock Trades for Tomorrow No. 2: Chipotle (CMG)

Top Stock Trades for Tomorrow No. 2: Chipotle (CMG)

Want to know another strong stock lately? Chipotle Mexican Grill, Inc. (NYSE:CMG). This burrito monster has been on a tear, almost doubling from its 2018 lows.

Now though, CMG is coming into some pretty notable resistance between $475 and $500. The optimist in me is looking for shares to push through, but the realist in me says that may not happen quite so fast.

You may recall we warned investors not to short CMG after it ran from $325 to $425 in a week. But now we need to see how it handles resistance. If it pushes through, then great, as bulls can buy with a great risk/reward. Buying as CMG enters resistance though is a bad risk/reward.

Top Stock Trades for Tomorrow No. 3: Dropbox (DBX)

Top Stock Trades for Tomorrow No. 3: Dropbox (DBX)

Another monster? Dropbox Inc (NASDAQ:DBX), which went public in March at $21. After closing at $42 on Monday, the stock is officially a double.

But the story is a little more strange than that. While the stock was holding onto its gains following a successful IPO, shares were getting into a narrow, sideways range. It was the perfect name to watch for a breakout or a breakdown. However, no one expected it go from $31 to $43 in three days. We still don’t really have an explanation, (although there may be some reasoning).

While shares are down a bit Tuesday, the 40% gain in five days gives recent investors a lot of cushion to work with. I wouldn’t chase this name because it’s run too much. But those that think this name could outperform amid further market weakness (as we’ve seen the past few days) could buy DBX and use a stop-loss below Tuesday’s lows.

Top Stock Trades for Tomorrow No. 4: Celgene (CELG)

Top Stock Trades for Tomorrow No. 4: Celgene (CELG)

To say Celgene Corporation (NASDAQ:CELG) stock has been hammered this year almost feels like an understatement. With shares down more than 40% over the past eight months, it’s surprising to see this dud outperforming on any day, let alone Tuesday, up 2%.

$75 held as support and shares have been consolidating above this level for a month. That gives bulls a solid risk/reward should they go long near current levels.

Investors have two real tests though: If $75 is retested it has to hold or CELG could be in for more pain. Additionally, downtrend resistance is now near $83, but could be lower by the time it comes into play, which will be vital to bulls and bears.

If it holds, bears are still in control. A close above it and bulls have the ball.

Top Stock Trades for Tomorrow No. 5: MGM Resorts (MGM)

Top Stock Trades for Tomorrow No. 5: MGM Resorts (MGM)

It can’t all be about the winners today.

Should we call it $29? How about $30? For MGM Resorts International (NYSE:MGM), it’s not perfectly clear as to what the level is that shares must hold, but it’s pretty darn close.

Our line — parked at the politically correct $29.50 mark — shows this area was a critical pivot point for MGM as it went from resistance to support. Should it give way, it will likely become resistance again.

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8 Long-Term Uptrend Stocks to Buy

Source: Emilio Kuffer via Flickr

In the early stages of an uptrend, it’s hard to tell just how far a stock will rally. Sometimes these trends are short-lived and “only” give us a 10% return. Other times though, these trends are good for several years and return 100% or more.

Telling the difference in the beginning is tough and too many investors take a pass on something because it’s up 10% or 20% in a few months. While there’s no such thing as a risk-free bet, they’re leaving a ton of reward on the table by avoiding the name simply because of its recent rally. It reminded me of a line from a great writer, Richard Saintvilus:

One lesson, among many others, I’ve learned on Wall Street is that it’s never too late to make the right call. And if ever that proverbial train “leaves the station,” there’s nothing wrong to admit you were wrong and chase that train to get back on board — even if the ticket costs more to ride.”

A stock rallying from $105 to $125 in a few months is a lot and may make many feel they’ve missed the train. But what if we ignored a good fundamental situation because “it had rallied too much.” Ultimately nine months later that stock is sitting another $50 per share higher and we ignored it. We sat out a $50 per share gain because of its $20 rally? That doesn’t make any sense.

With that in mind, let’s take a look at 8 solid stocks that are still in an uptrend and may still have farther to go.

Uptrend Stocks to Buy: Netflix

Netflix, Inc. (NASDAQ:NFLX) has been on a mission, both in reality and in the stock market. The company’s goal is to become the leader in global streaming. With 125 million customers, it’s well on its way to fulfilling that leadership goal. Heck, its market cap is just $7 billion short of Walt Disney Co (NYSE:DIS).

That puts things in perspective a bit.

But NFLX stock has been even more impressive than the company. It’s up 132% over the past 12 months and 73% since the start of 2018. That’s paved a solid — if also explosive — uptrend for investors. Take note of the chart to see what I mean.

nflx stock in an uptrend

As you can see, Netflix stock has been a beast. Notice that when it started 2018, shares weren’t over $200 yet! Now we’re already over $300. The move has been intense, but so long as the trends stay in place it’s hard to bet against NFLX.

Over its previous highs and above $330, Netflix stock is basing nicely. Momentum is strong and the stock is not yet overbought (blue peaks on the chart). Should nearby support fail, investors would be lucky to gobble up the stock near $300. There should be support near this level, along with the 50-day moving average and a rising uptrend line of support.

Given that the company just beat earnings, revenue and subscriber estimates, as well as provided subscriber guidance that topped analyst estimates, I’d rather be a buyer on dips than a seller on rips.

Uptrend Stocks to Buy: Nvidia

Nvidia Corporation (NASDAQ:NVDA) has been one of the market’s best performers. If you bought this name at the start of 2016 and forgot how to hit the sell button, you’d be sitting on a 600% gain in Nvidia. While the move has been extraordinary, we could be setting up for even more gains.

nvda stock in an uptrend

Looking at the charts, it’s pretty obvious that Nvidia has been struggling to eclipse the $250 mark. On three separate occasions this year, shares have rallied to this point only to fail and stumble lower.

Thursday’s 3% selloff could setup NVDA stock to retest the 100-day moving average and uptrend support that’s been in place for almost a year. As much as investors would hate to see this level fail though, I would love to get a shot at NVDA near $200. At this level, it would have the 200-day moving average and decent support to hold it.

Just like January 2017 through May 2017, it’s good to see Nvidia digest some of its massive move over the past 12 months. If there are worries about waning demand due to cryptocurrency headwinds, then Nvidia stock could see a further decline — perhaps down to that $200 level we’re wishing for.

While this is one of the strongest uptrend stocks we’ve seen, remember it has massive gains over the past few years. Eventually a big pullback wouldn’t be a surprise. If $200 comes, it would be a 20% decline for the highs. I’d love to buy into its secular upside on a short-term selloff.

Until then, the $250 breakout is still in play.

Uptrend Stocks to Buy: Boeing

Boeing Co (NYSE:BA) went from a frustratingly stubborn stock to one that couldn’t be stopped. Consider that BA stock was flat from January 2014 through October 2016, almost a three-year lull. However, shares then exploded 90% in 2017.

So what now?

BA stock in an uptrend

It obviously wouldn’t be surprising to see Boeing stock settle down and consolidate a bit. Even bouncing between $300 and $360 for a few quarters would represent a relatively healthy consolidation period.

I like BA for its intense earnings growth, commitment to capital return and huge free-cash flow. It’s not the cheapest stock in the world anymore, but valuation and consolidation aren’t enough of a reason to sell the stock.

Shares still look great in the short-term, as our chart shows. Poking through resistance with plenty of support nearby, BA stock could retest its old highs if these patterns hold steady. It’s got bullish momentum and isn’t overbought yet either (blue circles on the chart).

Uptrend Stocks to Buy: Salesforce

salesforce.com, inc. (NASDAQ:CRM) has tripled since mid-2013, but its gains over the past 16 months have been truly impressive. Shares have quietly rallied 81% over that period, forming quite the uptrend in CRM.

crm stock in an uptrend

This is one of my favorite names, because despite its $90 billion market cap, it still flies under the radar. Alphabet Inc (NASDAQ:GOOGL), Amazon.com, Inc. (NASDAQ:AMZN) and Microsoft Corporation (NASDAQ:MSFTget all the credit for their cloud businesses.

Despite CRM still churning out incredible growth, it seems to be much less discussed than it was a few years ago. That’s not stopping the analysts, though. They expect annual revenue of about 20% for the next four years. On the earnings front, estimates call for almost 60% growth this year and another 26% growth next year.

While CRM is pretty expensive on an earnings basis, its sales-based valuation is actually pretty reasonable versus its peers. CRM has better growth than most of its large cap competition and far superior financials and cash flow compared to its smaller competition. It’s in a real sweet spot right now. Lastly, the company has a very long runway for growth — as seen by the long-term revenue predictions — giving investors confidence to buy the stock today.

Investors could easily draw an uptrend line on CRM’s chart to highlight the stock’s robust rally. But just look at the 100-day moving average instead. All three major moving averages are trending higher, but each time Salesforce pulls back to the 100-day, CRM has an intense bounce.

Uptrend Stocks to Buy: Roper

Roper Technologies Inc (NYSE:ROP) has been in a very steady uptrend over the last year and a half.

In fact, Roper was and still is one of my top Future Blue Chip stocks. Known for robust revenue and earnings growth today, management has demonstrated a tangible commitment to returning capital to shareholders. The goal here is simple: Allow the company’s robust growth to drive shares higher over the long-term and cement its position in our portfolio with a low cost basis, while enjoying management’s continued commitment to raising the dividend once the business is more matured.

Rop stock in an uptrend

Well, ROP sure is delivering on the first part of our strategy: allowing strong growth to drive shares higher. Since the start of 2017, Roper stock is up more than 50% and is up more than 35% over the past year.

I’m definitely not ready to bet against Roper anytime soon. However, some may start to grow concerned over its valuation and growth profile. Analysts expect sales growth of just 6.1% this year and 7% next year. That’s good, but not necessarily great. While 17.5% earnings growth this year is very solid, estimates of just 8.5% next year is sort of lackluster.

It may make some wonder if ROP stock is worth 25 times this year’s earnings and 23 times next year’s estimates. On the chart though, Roper still looks great.

There’s pretty clear resistance between $285 and $290, while uptrend support currently sits around $270. The 100-day is support as well. If these support levels give way though, the 200-day moving average would be my downside target. If ROP stock breaks over resistance, consider buying the breakout.

Uptrend Stocks to Buy: Visa and MasterCard

Let’s do a double for this one: Visa Inc (NYSE:V) and Mastercard Inc (NYSE:MA). Both companies are huge beneficiaries of the same trend, as global consumers continue moving to credit and debit from cash and check. Further, growing e-commerce sales bode well for V and MA too, for obvious reasons.

V stock in an uptrend

The credit card business is attractive for many reasons, as V and MA serve as simple “toll booth” businesses. They don’t lend consumers money and they don’t take on big risks. Instead, when a consumer purchases goods or services from a merchant and pays via credit card, the merchant pays a fee that goes to V and MA.

While the pair of stocks may look expensive on a sales basis at first glance, the earnings-based valuation isn’t all that bad. Especially considering their double-digit earnings and revenue growth.

Throw in the fact that Visa has profit margins of almost 40% while MA has margins of 32% and we can see that these two are earning money hand over fist.

ma stock in an uptrend

Both stocks tend to trade with a high correlation. They’ve been in a steady uptrend since early 2017 and I hate that I’ve taken some off the table since I first initiated a position almost six years ago.

As V and MA both bump up against resistance, they look like they’ll soon push through to new highs, short of another market-wide selloff.

Uptrend Stocks to Buy: Raytheon

Like Roper, Raytheon Company (NYSE:RTN) is another under-the-radar company. However, its stock sure has become something to talk about, with shares up about 50% over the past 12 months.

While the rest of the market has been floundering, RTN stock is already up more than 21%. That’s what happens when a company makes anti-missile defense systems and the U.S. military has an annual budget of roughly $700 billion.

rtn stock in an uptrend

While the U.S. government utilizes other anti-missile defense systems — Lockheed Martin Corporation (NYSE:LMT) also makes one — the desire for countries to boost their defensive capabilities continues to increase. That’s no surprise given the tension on the Korean Peninsula and continuing conflicts in the Middle East.

Despite expectations calling for revenue growth of about 5% this year and next year, earnings are set to explode — no pun intended. Analysts are looking for 27% growth this year and more than 15% growth in 2019. With earnings growth outpacing revenue growth, look for margins to expand as well. If the government keeps spending like Trump has so far, expect more lucrative contracts in the future, too.

After flagging the stock as a potential breakout candidate earlier this month, the recent 52-week highs come as little surprise. Going forward, look for RTN to make even more highs so long as its uptrend support holds steady (as shown on the chart). Keep in mind, the average analyst price target sits at $240.

Get up to 14 dividend paychecks per month from safe, reliable stocks with The Monthly Dividend Paycheck Calendar, an easy-to-use system that shows you which dividend stocks to pick, when to buy them, when you get paid your dividends, and how much.  All you have to do is buy the stocks you like and tell them where to send your dividend payments. For more information Click Here.