All posts by Will Ashworth

The 10 Best ETFs of February 2018

February was a crazy month for investors; consequently, the landscape of best-performing exchange-traded funds expanded from primarily biotech and emerging-market ETFs in January to several other spaces for this edition of the best ETFs of the month.

In February, the fortitude of those with generally bullish outlooks was tested as the Dow Jones Industrial Average made historic 1,000-plus point drops twice in less than two weeks. Meanwhile, the S&P 500 is down more than 4% on the month.

The turmoil is mostly attributed to anticipation of a rise in interest rates based on expectations of inflation in the months ahead. But outside of these struggles, some ETFs still managed to maintain impressive performances, while others managed to step up and replace old champions.

In no particular order, here are the best ETFs of February, excluding leveraged funds and exchange-traded notes.

Best ETFs of February: ProShares Long Online/Short Stores ETF (CLIX)

Best ETFs of February: ProShares Long Online/Short Stores ETF (CLIX)

Source: Shutterstock

Expense Ratio: 0.65%
YTD Performance: 18% vs 2% for the S&P 500

Among the best ETFs of February were several retail-based ETFs. Notably, the ProShares Long Online/Short Stores ETF (NYSEARCA:CLIX) manged to stand out from the crowd, as it has significantly outperformed the S&P 500 in 2018 so far.

This recently founded ProShares ETF is distinct in that it has a multifaceted strategy that aims to take full advantage of the death of traditional retail while also focusing on the rise of internet retailers. The CLIX achieves this by shorting traditional retail stocks and simultaneously holding online retailers with significant growth. As such, its holdings are constantly varying.

In simplest terms, the long/short approach of this ETF means investors “benefit from both outperforming online and underperforming physical retailers.”

Best ETFs of February: Loncar Cancer Immunotherapy ETF (CNCR)

Best ETFs of February: Loncar Cancer Immunotherapy ETF (CNCR)

Source: Shutterstock

Expense Ratio: 0.79%
YTD Performance: 23%

Last month, the Loncar Cancer Immunotherapy ETF (NASDAQ:CNCR) made it on the list of best-performing ETFs and it continued its success in February with an impressive 20% advantage over the S&P.

For those who are unfamiliar with CNCR, it’s a biotech ETF that emphasizes companies that are involved with cancer research and treatment.

More specifically, CNCR’s holdings must have cancer immunotherapy drugs that are approved by the FDA or EMA, are in human testing stages, are about to enter human testing stages and/or are involved with other companies that focus on immunotherapy. This includes companies like Aduro BioTech Inc (NASDAQ:ADRO) and AstraZeneca plc (ADR) (NYSE:AZN), which are among its top 10 holdings.

Best ETFs of February: Franklin FTSE Brazil ETF (FLBR)

Expense Ratio: 0.19%
YTD Performance: 14%

Although some new names made the list of best ETFs of February, Brazilian emerging market ETFs like Franklin FTSE Brazil ETF (NYSEARCA:FLBR) still performed exceptionally well this month.

The FLBR follows the FTSE Brazil Capped Index, which emphasizes the most notable large- and mid-cap companies in the country. Although investing in emerging markets like Brazil carries significant risks, top holdings like iron producer Vale SA (ADR) (NYSE:VALE) and brewing company Ambev SA (ADR) (NYSE:ABEV) give investors access to tons of growth potential in a less familiar marketplace.

Best ETFs of February: Global X Social Media ETF (SOCL)

Expense Ratio: 0.65%
YTD Performance: 12%

Global X Social Media ETF (NASDAQ:SOCL) does exactly as its name suggests — it gives investors exposure to social media companies from across the world. As such, it isn’t your run-of-the-mill tech ETF. And the fact that it has outpaced the S&P 500 places it among the best ETFs of 2018 so far.

The SOCL ETF does hold U.S. social media names like Twitter Inc (NYSE:TWTR) and Snap Inc(NYSE:SNAP), but it also holds international social media stocks like Russian internet technology company Yandex NV (NASDAQ:YNDX) and Chinese internet-based holding company Tencent Holdings Ltd (OTCMKTS:TCEHY).

Best ETFs of February: iShares MSCI Brazil Capped ETF (EWZ)

Best ETFs of February: iShares MSCI Brazil Capped ETF (EWZ)

Source: Shutterstock

Expense Ratio: 0.62%
YTD Performance: 14%

As with last month, another Brazilian-based ETF — iShares MSCI Brazil Index (ETF)(NYSEARCA:EWZ) — managed to out-do the competition and it remains one of the best ETFs of 2018 so far.

This ETF isn’t significantly different from the FLBR, but as emphasized on last month’s list, EWZ is more focused — it has less holdings — and it has a significantly longer track record of success than relative newcomer FLBR. However, depending on how you look at it, the FLBR could have the upper hand since it has a lower expense ratio at 0.19% compared to the EWZ’s 0.62%.

Ultimately, whichever ETF you focus on, Brazil remains one of the hottest emerging markets out there, and both funds have demonstrated significant staying power in 2018.

Best ETFs of February: Amplify Online Retail ETF (IBUY)

Best ETFs of February: Amplify Online Retail ETF (IBUY)

Source: Shutterstock

Expense Ratio: 0.65%
YTD Performance: 13%

The Amplify Online Retail ETF (NASDAQ:IBUY) is another retail ETF that has managed to beat the competition at the start of the year and become one of the best-performing ETFs.

Unlike the CLIX, the IBUY does not feature a short/long approach; however, it distinguishes itself by focusing on both traditional retail names that are converting to a primarily online format and online e-tailers that should experience significant growth in the years ahead. This gives investors a basket of stocks with known-name brands like Lands’ End, Inc. (NASDAQ:LE) and online up-and-comer Shutterfly, Inc. (NASDAQ:SFLY).

Best ETFs of February: PowerShares NASDAQ Internet ETF (PNQI)

Best ETFs of February: PowerShares NASDAQ Internet ETF (PNQI)

Source: Shutterstock

Expense Ratio: 0.6%
YTD Performance: 15%

Although many biotech ETFs were among the best performing last month, many tech/internet-based ETFs have manged to hold strong through February’s volatility. The PowerShares Exchange-Traded Fund Trust (NASDAQ:PNQI) is no exception, as it has out-paced the S&P 500 by more that 12%.

The PNQI tracks the NASDAQ Internet Index, which contains the “largest and most liquid U.S.-listed companies engaged in internet-related businesses.” In plain English, that means the ETF contains major tech names like Netflix, Inc. (NASDAQ:NFLX), Amazon and Chinese internet search provider Baidu Inc (ADR) (NASDAQ:BIDU).

It might not have countless obscure tech names with mega-ton growth potential, but it does contain many of the top players with more than 90% of its holdings allocated to mostly large-cap stocks that focus on internet software & services and internet & direct marketing retail. This makes it a fairly reliable fund for those who have faith in the consistently strong tech space.

Best ETFs of February:  iShares MSCI Russia Capped ETF (ERUS)

Best ETFs of February:  iShares MSCI Russia Capped ETF (ERUS)

Source: Shutterstock

Expense Ratio: 0.62%
YTD Performance: 13%

Although it didn’t make an appearance on last month’s list, Russia was a notable emerging market in February, as seen in the standout performance in the iShares MSCI iShares MSCI Russia ETF (NYSEARCA:ERUS).

While U.S. stocks were generally struggling to hold their ground, the ERUS manged to gain a 12% lead over the S&P. As with all emerging markets, there is tons of growth potential packed in, but with that comes significant risk. But investors who are willing to look past these risks (as well as the “us versus them” political landscape), might find what they’re looking for in this fund.

The ERUS tracks a wide variety of Russian stocks like financial Sberbank of Russia(OTCMKTS:AKSJF) and gas pipeline operator Gazprom PAO (ADR) (OTCMKTS:OGZPY), most of which are likely unfamiliar to U.S.-based investors.

Best ETFs of February: iShares Latin America 40 ETF (ILF)

Best ETFs of February: iShares Latin America 40 ETF (ILF)

Source: Shutterstock

Expense Ratio: 0.49%
YTD Performance: 12%

As mentioned earlier, several emerging-market ETFs retained their spot on the list of best ETFs for the month, and that includes the iShares S&P Latin America 40 Index (ETF)(NYSEARCA:ILF).

Although several of the ETFs on this list emphasize Brazil, the ILF will be appealing to those looking for generalized exposure to the best that the Latin American marketplace has to offer. There’s still an impressive allocation to Brazilian stocks with this ETF (60%), but other Latin American countries — Mexico (23%) and Chile (12%) — have a significant presence.

As such, its top holdings include companies like Brazilian energy play Petroleo Brasileiro SA Petrobras (ADR) (NYSE:PBR), telcom America Movil SAB de CV (ADR) (NYSE:AMX) and Mexican holding company Fomento Economico Mexicano SAB (ADR) (NYSE:FMX).

Best ETFs of February: KraneShares CSI China Internet ETF (KWEB)

Best ETFs of February: KraneShares CSI China Internet ETF (KWEB)

Source: Shutterstock

Expense Ratio: 0.72%
YTD Performance: 9%

The KraneShares CSI China Internet ETF (NYSEARCA:KWEB) embodies a combination of two trends that the best ETFs of the month followed: it’s an emerging-market ETF with an emphasis on internet-based companies.

Specifically, the KWEB focuses on “China-based companies whose primary business or businesses are in the internet and internet-related sectors.” What that all boils down to is a large sector breakdown in tech (60%) and consumer discretionary (37%) stocks, with the remainder allocated to industrial companies (2.5%).

The fund’s heavy emphasis on Chinese large-cap (55.7%) and mid-cap (35.4%) companies leads to top holdings like the “Chinese Amazon” Alibaba Group Holding Ltd (NYSE:BABA), JD.Com Inc(ADR) (NASDAQ:JD) and Weibo Corp (ADR) (NASDAQ:WB).

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Source: Investors Place

7 Buffett Stocks to Buy

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If you’re looking for good Warren Buffett stocks to buy, there’s no better option than Buffett’s former money guy. I’m talking, of course, about Lou Simpson, the long-time Geico portfolio manager, who retired at the end of 2010 after 31 years at the company, more than a third of them spent under Berkshire Hathaway Inc. (NYSE:BRK.A, NYSE:BRK.B) ownership.

It’s hard to believe that the legendary investment manager, who outperformed the S&P 500 in 18 out of 25 years between 1980 and 2004, has been retired for more than seven years. Boy does time fly.

Simpson grew bored of retirement very quickly, so the veteran money set up SQ Advisors, an investment advisory firm with $200 million in assets under management that would handle money for friends, family and some charities.

Charging 1% annually with no performance fees, Simpson was just happy to have something to do every day that he enjoyed and could help people. Fast forward to the end of 2017 and Simpson’s managing $3.1 billion in assets invested in just 14 stocks.

Although all 14 companies in SQ Advisors’ portfolio are good investments, here are what I think are the seven stocks to buy from Lou Simpson’s portfolio:

Buffett Stocks to Buy: Brookfield Asset Management (BAM)

This alternative asset manager is easily one of my favorite stocks anywhere in the world. Up until mid-2017, long-time Brookfield Asset Management Inc (NYSE:BAM) CEO Bruce Flatt flew under the radar of most investors.

However, it decided it needed to tell its story to more people, and so the company went on a bit of a PR tour that culminated in Flatt appearing on the cover of Forbes magazine’s May issue.

Most people probably couldn’t pick Flatt out of a police lineup but Simpson could.

Brookfield is SQ Advisors’ largest holding at $335 million, or 10.9% of its multi-billion portfolio. He knows that delivering a cumulative return of 1,350% over the last 15 years, as Flatt and company have done — more than seven times the S&P 500 — is no easy feat.

Lou Simpson investing in Brookfield, especially in such a focused portfolio, is the ultimate form of flattery. If you can only own one of these stocks, I’d make it Brookfield.

Buffett Stocks to Buy: Liberty Global (LBTYK)

Buffett Stocks to Buy

Source: Shutterstock

Liberty Global PLC (NASDAQ:LBTYK) is one of John Malone’s many interests. Malone holds 25.7% of Liberty Global, the world’s largest international TV and broadband company with $15.5 billion in annual revenue operating in 12 European countries under brands such as Virgin Media and Unitymedia.

In case you’re wondering, Warren Buffett’s company controls 5.4% of Liberty Global’s votes; SQ Advisors about half that amount. Simpson acquired his position in the second half of 2014 at prices between $40 and $43. Today, it trades around $32.

But before you question my sanity, it’s important to remember that Liberty Global spun off its Latin American business — operations in Chile, Puerto Rico, the Caribbean and other parts of Latin America — in early January.

Shareholders got one share in the newly independent business for each Liberty Global share. Together, they’re worth $55.

Simpson holds his businesses for the long haul, so unless the story drastically changes I’d expect him to continue to make Liberty Global one of his biggest positions.

Buffett Stocks to Buy: Berkshire Hathaway (BRK)

Buffett Stocks to Buy

Source: Shutterstock

It would be darn near impossible not to include the stock of Simpson’s former boss on my list of seven stocks to buy.

Interestingly, Berkshire Hathaway is not one of SQ Advisors’ top five holdings. In fact, Simpson only owns a little over one million Class B shares, which represent 6.7% of the $3.1-billion portfolio.

Although Buffett and Simpson have a similar investing style, the former Geico money manager is far more likely to invest in smaller companies than Buffett, making a more significant position in Berkshire Hathaway an unlikely occurrence.

“What we do is run a long-time-horizon portfolio comprised of ten to fifteen stocks. Most of them are U.S.-based, and they all have similar characteristics. Basically, they’re good businesses,” saidSimpson in a rare 2017 interview. “They have a high return on capital, consistently good returns, and they’re run by leaders who want to create long-term value for shareholders while also treating their stakeholders right.”

That sounds an awful lot like Berkshire Hathaway, doesn’t it?

Simpson bought a big chunk of BRK stock back in early 2012 at prices between $76 and $82, an annualized return of 17.1% over six years.

Buffett Stocks to Buy: Tyler Technologies (TYL)

Buffett Stocks to Buy

Source: Shutterstock

While this is one of Simpson’s smaller holdings representing just 5.2% of SQ Advisors’ portfolio, I just love the niche aspect of its business. Tyler Technologies, Inc. (NYSE:TYLfocusesexclusively on the public sector providing a wide range of software and solutions to local governments and schools.

It might not be glamorous, but providing the tools needed by public sector operations pays the bills; more importantly, it keeps America moving. A storied history that dates back to 1938, Tyler committed to serving the public sector in 1997; it’s been uphill ever since.

The company finished 1997 with a profit of $1.2 million on $76.4 million in revenue. Nineteen years later, in its most recent fiscal year ended Dec. 31, 2016, it generated net income of $109.9 million on $756.0 million in revenue.

A $100 investment at the end of 2011 was worth $474.16 five years later, more than double the performance of the S&P 500 in the same period.

It’s not a fast-growing business but it sure is consistent, increasing revenues in nine out of the last ten years. No wonder Simpson likes it.

Buffett Stocks to Buy: Cable One (CABO)

Buffett Stocks to Buy

Source: Shutterstock

One of the portfolio’s smallest holdings by market cap, Simpson added 125,094 shares of Cable One Inc (NYSE:CABO) in Q4 2017, boosting it from the tenth-largest position in the previous quarter, to the fifth largest by the end of the year.

Representing 8.2% of the portfolio, Cable One is one of the ten largest cable companies in the U.S. with more than 800,000 residential and business customers across 21 states. 

Why Cable One?

It’s got a simple business plan that focuses on higher-growth, higher-margin products that generate positive cash flow while keeping a lid on costs. It doesn’t want the most customers; it wants the most profitable ones.

Looking to find more profitable customers, Cable One acquired NewWave Communications in 2017 for $735 million. NewWave was the 19th largest cable company in the U.S. with customers in seven states. Still, in growth mode, Cable One’s focus on the profit and loss statement will deliver higher returns from NewWave under its management.

Simpson likes owning good businesses. Cable One fits that to a tee.

Buffett Stocks to Buy: Charles Schwab (SCHW)

Buffett Stocks to Buy

Except for the recent return of volatility, the nine-year bull market has been good news for Charles Schwab Corporation (NYSE:SCHW), who’ve seen operating profits grow from $1.1 billion at the end of 2009 to $3.7 billion this past year while operating margins increased 16 percentage points to 43%.

The wealth management industry’s been good to Schwab and Schwab shareholders. Over the past five years, SCHW stock’s delivered an annualized total return of 26.3% to shareholders.

Now Simpson’s third-largest holding, it’s clear he’s not afraid to buy and sell Schwab stock, as the number of shares held has ebbed and flowed since first buying in 2011.

Currently trading near $53, Schwab had a very healthy 2017, with revenues and income up 15% and 25%, respectively. An amazing stat highlighted in its Q4 2017 press release gives you an idea of the runway it has heading into 2018 and beyond:

Schwab’s Retail business rose by 49% versus 2016; 54% of these households were age 40 or younger.”

Need I say more?

Buffett Stocks to Buy: Allison Transmission (ALSN)

Buffett Stocks to Buy

Source: Shutterstock

 Allison Transmission Holdings Inc (NYSE:ALSN) might be the ultimate Warren Buffett stock if it were only a little bigger.

 Simpson’s fourth-largest holding at 10.0% of the portfolio. While the money manager trimmed SQ Advisors’ holdings slightly in Q4 2017, the manufacturer of heavy-duty commercial vehicle transmissions and hybrid-propulsion systems for city buses is a relatively new purchase for Simpson; he first acquired shares in 2016.

As long as the U.S. economy continues to chug along, investors can expect Allison Transmission to continue to do well. In Q4 2017, the company increased its North America On-Highway revenue by 24% to $270 million. Outside North America, Allison’s On-Highway business increased sales by 18% year over year to $98 million.

In fiscal 2017, revenues and operating profits increased by 22.9% and 44.3%, respectively. The company expects 2018 net sales to increase by as much as 7% on strong On-Highway results.

Unless something happens to the economy, this guidance seems conservative. I see good things in store for Allison in 2018.

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Source: Investor Place

7 Stocks to Own Should the Latest Correction Get REALLY Ugly

It’s official. The latest correction in the markets has entered scary territory. If you’re one of the thousands of investors freaking out, you might want to consider these seven stocks to own should things get really ugly.

Boy, did it come out of the blue, or what?

The S&P 500 gained 5.7% in January. By the end of trading Feb. 7, it had lost more than 80% of those gains culminating with the index’s reversal of fortune.

Up 1.2% in the first few hours of February 7 trading, investors fled in droves, sending stocks for a 0.5% loss on the day, the fourth negative performance in five days of trading erasing more than a trillion dollars in market cap. 

Where to hide other than cash?

Here are seven stocks to own I believe can withstand whatever else this correction throws at investors.

You’ll note all seven have little or no debt, lots of free cash and as wide a moat as possible.

Happy investing.

Stocks to Own Should Latest Correction Get Really Ugly: Public Storage (PSA)

I recently moved from Toronto to Halifax, a thousand-mile change in residence. Not having moved in a while, my wife and I had accumulated a lot of junk.

It made me realize that people don’t like to part with their junk, hence the growth in self-storage facilities like the ones owned by Public Storage (NYSE:PSA).

There’s a two-step process. 

First, you realize your house is overloaded with stuff, so you rent a storage locker to declutter. Then after a few years, you forget why you had a storage locker in the first place, so you call someone like 1-800-Got-Junk to haul it away. And then you repeat the process over and over until you die.

I’m facetious, of course, but I’m sure there’s a grain of truth in what I’m saying. In good times and bad, people are always looking for storage space.

Last July, I called PSA a boring stock to own, which it is, because it operates in an industry that’s only going to keep growing as boomers downsize.

Since recommending its stock, it’s down a little more than 10%. At the time, I thought it was cheap; it’s even cheaper today. It yields an attractive 4.3%. 

Stocks to Own Should Latest Correction Get Really Ugly: Acuity Brands (AYI)

Stocks to Own Should Latest Correction Get Really Ugly: Acuity Brands (AYI)

Source: Shutterstock

Consider this my contrarian pick of the bunch.

Acuity Brands, Inc. (NYSE:AYI) specializes in lighting solutions for homes and businesses. It has been in an awful funk in recent years after going on a big run that saw its stock deliver annual returns of 29%, 62%, 29% and 67% between 2012 and 2015.

In January, I called Acuity Brands one of the ten stocks that could surprise in 2018. That’s on top of recommending its stock on two occasions in 2017.

Since my article, it has lost another 20% on top of the 24% it lost in 2017.

A glutton for punishment, I can’t ignore the fact analysts expect it to earn $9.40 a share in 2018 and $10.23 in 2019. That’s less than 15 times its forward 2019 earnings.

Considering its P/E ratio hasn’t been this low since 2008, I see Acuity as a smart buy in a market that’s taking down overpriced stocks.

Stocks to Own Should Latest Correction Get Really Ugly: Hormel Foods (HRL)

When times get difficult, many people eat to forget their problems. A company like Hormel Foods Corp (NYSE:HRL) can help with that. Some of its brands have been around for years such as Spam, its mystery meat product in a can.

Hormel as increased its dividend for 52 consecutive years. In times of market volatility, it’s nice to know you’re going to get paid regardless of what happens to the stock price in the interim.

In October, Hormel announced that it was paying $850 million to acquire Columbus Manufacturing, Inc., a California business that specializes in premium deli meats under the Columbus brand. Together with its other deli brands Hormel and Jennie-O, it allows the company to provide a stronger offering to grocery stores in the refrigerated foods aisle.

Accretive to earnings in both 2018 and 2019, this is an excellent example of a strategic investment that will transform this segment of Hormel’s business.

Hormel stock has flatlined since early 2016. The Columbus acquisition should help get it unstuck. Until it does, a 2.3% yield isn’t a bad trade-off for a stock that’s trading at 17.5 times cash flow, its cheapest valuation since 2012.

Stocks to Own Should Latest Correction Get Really Ugly: Tractor Supply (TSCO)

Stocks to Own Should Latest Correction Get Really Ugly: Tractor Supply (TSCO)

Tractor Supply Company (NASDAQ:TSCO) serves the rural lifestyle. Its combination of product offerings provides a nice contrast to retailers like Walmart Inc (NYSE:WMT) and Home Depot Inc (NYSE:HD).

In the last couple of years, TSCO’s stock has missed out on the broader rally in the markets and now trades in the high $60’s, well off its all-time high of $97, hit in May 2016.

Its recent earnings results are encouraging — same-store sales up 4% in Q4 2017 compared to 3.8% a year earlier; transactions were up 2.7% and average ticket increased 1.3% — but it needs to work a little harder on keeping margins in check if it also wants to grow the bottom line.

A big reason for the 120 basis point increase in its Q4 2017 SG&A expenses is Tractor Supply continues to work on providing a better customer experience through technology and employee training and those things cost money.

In 2018, TSCO sees comps of at least 2%, net income of between $490 million and $515 million, and net sales of at least $7.69 billion.

In the past week, TSCO stock’s seen a 12% slide in its share price and is now trading at 16.7times its forward earnings, which is well below its average P/E ratio over the past decade. 

Perhaps, this too is a contrarian pick for a volatile market, but I see a stock that’s taken a beating for far too long and is ready to come to life.

Stocks to Own Should Latest Correction Get Really Ugly: Carter’s (CRI)

Stocks to Own Should Latest Correction Get Really Ugly: Carter’s (CRI)

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When it comes to buying clothes for babies and young children, Carter’s, Inc. (NYSE:CRI) has the upper hand on the rest of retail. Between the Carter’s and OshKosh B’gosh brands, many new parents make it a must visit, hence why it’s the largest branded marketer of apparel to these two age groups.

Sure, we might not be having kids at the same rate as in the past, but we’re definitely willing to spend money on those we do bring into the world. We’ll forego buying ourselves a nice pair of pants to buy that cute jumper for our newborn.

In Carter’s Q3 2017 results announced at the end of October, it had notably strong U.S. results. Retail same-store sales increased 2.6% on the strength of eCommerce comp growth of 20.9%, offset by a 3.2% decline in brick and mortar sales.

Interestingly, that’s not necessarily a bad thing for the company. As customers become accustomed to the fit of its clothes, it makes sense for returning buyers to purchase online saving themselves time.

Omnichannel means you’re sometimes going to see store comps contract as eCommerce grows. It’s a fact of life in the new retail.

Carter’s continues to drive margins higher generating record free cash flow which it uses to buyback shares, pay dividends and keep debt low.

As long as people have kids, it’s a great stock to own in volatile markets. 

Stocks to Own Should Latest Correction Get Really Ugly: Church & Dwight (CHD)

Church & Dwight Co., Inc. (NYSE:CHD) not only is a great stock to own should the markets get really ugly, it’s one of the most consistent performers trading on the NYSE.

Back in 2016, I wrote about the consumer packaged goods company’s perfect record over the past decade. It hadn’t experienced a single year in negative territory. It’s carried on with that tradition notching gains of 5.8% in 2016 and 15.3% in 2017. 

The gains over the past two years seem insignificant compared to the S&P 500, but over the long haul, Church & Dwight has delivered for shareholders. A $10,000 investment in CHD stock at the beginning of 2008 is worth approximately $42,000. The same investment in the index is worth approximately $23,000 or 40% less.

The company has a proven method for building its business through acquisitions and organic growth. By focusing on a few healthy brands, it’s able to grow market share over time.

If you’re going to buy only one consumer defensive stock for your portfolio, Church & Dwight ought to be it.

Stocks to Own Should Latest Correction Get Really Ugly: Jacobs Engineering (JEC)

Stocks to Own Should Latest Correction Get Really Ugly: Jacobs Engineering (JEC)

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While an infrastructure plan is said to be coming from the White House at any moment, Jacobs Engineering Group Inc (NYSE:JEC) is too busy to notice.

The professional services company just released its Q1 2018 results and they were very healthy with adjusted net earnings up 13% to $97 million or $0.77 a share with double-digit organic revenue growth from its professional services segment.

The company continues to integrate its 2017, $3.3 billion acquisition of CH2M, Colorado’s largest privately held company. Jacobs is excited about the future with CH2M a part of the company.

Jacobs raised its fiscal 2018 guidance for adjusted earnings from $3.75 a share to $4.05, almost a 10% increase, as a result of the lower corporate tax rate.

It finished the quarter with a backlog of $26.2 billion. As the company continues to focus on profitable growth, I would expect JEC stock to hold up well should the markets continue to correct.

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Source: Investor Place 

7 Stocks to Buy That Are Winning With Tech

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Amazon.com, Inc. (NASDAQ:AMZN) made a major announcement Jan. 22. After more than a year getting the bugs out, the Seattle e-commerce company opened Amazon Go to the public.

Using artificial intelligence and cameras to keep tabs on the shoppers in the store — Amazon Go provides cashier-free grocery shopping — technology is changing the way consumers shop for groceries.

One of its customers is Amazon CEO, Jeff Bezos.

“Jeff [Bezos] has been aware. He loves the store — he definitely has shopped it,” VP of Amazon Go Gianna Puerini said. “He’s been super supportive and wonderful.”

So, depending on your point of view, Amazon is either a tech company using e-commerce as its end product or service or an e-commerce company using tech to sell its products and services.

While it’s using technology to grow its revenue, I’m going to pass on Amazon.

However, there’s no mistaking these seven stocks to buy that are all growing because of the intelligent use of new technology. 

Stocks to Buy Winning With Tech: Toyota (TM)

Stocks to Buy Winning With Tech: Toyota Motor (TM)

Source: Shutterstock

Toyota Motor Corp (ADR) (NYSE:TM) is one of the world’s largest automotive companies. To sell as many cars as it does, it needs supply chain management that’s second to none. Before its Jan. 23 announcement that it would start using Ottawa-based Kinaxis Inc’s cloud-based supply chain management solution, it was doing all of its planning by hand.

That’s no way for Toyota to be handling such a critical piece of its business planning.

“We are looking forward to working with Kinaxis to optimize inventory and enable more flexible responses to customer demand,” said Iwao Nakano, General Manager Corporate IT Division at Toyota. “RapidResponse will help us unify sales and production and will become the foundation upon which we can continue to realize improvement in demand and supply planning.”

Although Kinaxis isn’t well known outside Canada, many of its customers are; they’ve chosen the company’s RapidResponse solution because it dramatically improves supply chain management. Expect this to make Toyota even more efficient than it already is.

Stocks to Buy Winning With Tech: McDonald’s (MCD)

If I told you that technology could help McDonald’s Corporation (NYSE:MCD) improve its comparable store sales by 100 basis points in 2018 alone, would you buy the Golden Arches’ stock? I sure would.

“MCD is cultivating a digital platform through mobile ordering and Experience of the Future (EOTF), an in-store technological overhaul most conspicuous through kiosk ordering and table delivery,” Cowen & Company analyst Andrew Charles wrote in a note to clients last June. “Our analysis suggests efforts should bear fruit in 2018 with a combined 130 bps [basis points] contribution to U.S. comps [comparable sales].”

In Q3 2017, McDonald’s grew its global comps by 6%. Through the first nine months of fiscal 2017, those comps rose by 5.6%, which means a 130 basis point increase amounts to a 23% gain.

Combine these technology initiatives with the rollout of its $1 $2 $3 Dollar Menu and it’s no wonder MCD stock is hitting all-time highs.

Stocks to Buy Winning With Tech: Adidas (ADDYY)

Stocks to Buy Winning With Tech: Adidas (ADDYY)

Source: Shutterstock

The MIT Technology Review named Adidas AG (ADR) (OTCMKTS:ADDYY) one of its 50Smartest Companies 2017.

“The sneaker maker is changing the way it manufacturers shoes, launching a robot-intensive microfactory in Ansbach, Germany, where it will begin to produce locally and on demand later this year.,” stated the magazine. “A similar factory offering customization and faster reaction times to local fashion trends has been announced in the U.S.”

In addition to its move to robotics, it’s working with another company on MIT’s list — Carbon is ranked 18th — to deliver state-of-the-art athletic equipment including 4D shoes. According to the magazine, Adidas will print 100,000 pairs of shoes using Carbon’s technology by the end of 2018.

“Technology has also allowed Adidas to streamline some operations while also improving customer experience,” the Sourcing Journal’s Caletha Crawford wrote Jan. 18. “By teaming with FindMine, which uses visual algorithms to help merchandise products online, Adidas is able to better curate suggestions for shoppers.” 

Given how much growth Adidas experienced in 2017, it’s clear the investment in technology by the company is paying dividends.

Stocks to Buy Winning With Tech: Wal-Mart (WMT)

A definite upside to Amazon capturing such a big chunk of U.S. e-commerce sales — estimated at 44% in 2017 — is that Wal-Mart Stores Inc (NYSE:WMT) has been forced to get proactive about the use of technology, especially when it comes to online sales.

“Once viewed as a customer experience laggard, Walmart has turned to innovative tech to stay relevant, even leapfrogging some of the big e-tailers with a bold vision, …” stated Brennan Wilkie, an expert in customer experience intelligence, in an October 2017 article in Forbes. “At the end of the day, if what a brand promises does not line up with what customers want and expect, all the newfangled technology in the world won’t matter.”

InvestorPlace contributor Lawrence Meyers recently wrote that Walmart’s acquisition of Jet.com was a smart move to accelerate the company’s online ambitions. However, he’s not sure it will make a difference to the bottom line which has been slowly deteriorating in recent years.

I, on the other hand, consider Walmart’s willingness to embrace technology as a sign it’s willing to do whatever it takes to turnaround its business. Given WMT stock gained 46% in 2017, other investors feel the same.

Stocks to Buy Winning With Tech: Fiserv (FISV)

Stocks to Buy Winning With Tech: Fiserv (FISV)

Source: Shutterstock

Fiserv Inc (NASDAQ:FISV), one of the World Most Admired Companies according to Fortune, is using technology and automation to provide a better digital experience for financial services customers. For many banks, the transition between physical banking and digital banking is anything but seamless. It’s Fiserv’s job to make that more fluid.

By introducing new products such as voice banking through devices such as Alexa and other uses of artificial intelligence, the company hopes to bridge the gap.

“We need to begin to change the mindset,” Jamie Dominguez, director of product management for financial technology provider Fiserv told Bank Innovation. “Digital isn’t just about mobile and online, it’s really about a fluid experience.”

The use of technology to help financial institutions innovate has been profitable for FISV shareholders in recent years. Up almost 7% year to date through January 24, Fiserv hasn’t had a negative annual total return since 2008.

My instincts tell me Fiserv shareholders will continue to reward in the years ahead.

Stocks to Buy Winning With Tech: Nasdaq (NDAQ)

Stocks to Buy Winning With Tech: Nasdaq (NDAQ)

Source: Shutterstock

Nasdaq, Inc (NASDAQ:NDAQ) is the world’s largest operator of stock exchanges. It has embraced technology throughout its history, whether we’re talking about the introduction of electronic trading in 1971 or recently by using machine learning and data analytics to provide investors with the most comprehensive information and analysis possible.

Nasdaq had three priorities to execute this past year, one of which was to commercialize disruptive technologies such as blockchain, the cloud, and machine learning.

In November, Nasdaq filed a patent application with the U.S. Patent and Trademark Office that would create distributed ledgers using blockchain technology to store information regarding the ownership of assets.

“The application notes each block’s cryptographic hash value as an attractive feature, stating that the fact that a blockchain cannot be modified by malicious actors acts as an effective security function in protecting asset ownership data,” wrote Coindesk’s Nikhilesh De on Nov. 17, 2017.

Although Nasdaq admits that a lot more research is necessary before it would implement this technology, it’s easy to see why this is a significant development. For example, in places where the rule of law isn’t quite as robust, a secure and private network detailing the ownership of assets would provide greater protection for investors.

This type of innovation is what you want from a company like Nasdaq.

Stocks to Buy Winning With Tech: Stitch Fix (SFIX)

Stocks to Buy Winning With Tech: Stitch Fix (SFIX)

Source: Stitch Fix

Stitch Fix Inc (NASDAQ:SFIX) went public Nov. 16, 2017, at $15 a share. Since then, the online personal-styling service and clothing retailer’s stock is up 39.1% through Jan. 24.

Stitch Fix has taken mass customization to the limits using algorithms to figure out what customers want to wear.

“Like many personalized radio services (think Pandora), this service is designed to get better the more that you use it,” stated Stitch Fix founder Katrina Lake in a 2015 interview with Harvard Business Review. “Algorithms produce recommendations for stylists who use their personal experience and knowledge of the customer to curate those recommendations down to just five items per fix. As you purchase, answer questions and/or communicate with your stylist, each fix becomes increasingly accurate.”

People are starved for time. The number one rule for a creating a successful business, in my opinion, is to offer something to your customers that save people time or money. Stitch Fix does both.

As far as the seven stocks to buy winning with tech go, Stitch Fix is at the top of the list. Its service is tailored perfectly to the modern shopper.

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Source: Investor Place