All posts by Will Ashworth

7 Stocks to Buy That Are Run By Billionaires

Elon Musk’s 'Billionaire Games' Continue to Prop Up Tesla (TSLA) Stock
Source: OnInnovation via Flickr

I recently viewed a list of the 50 richest people in the world. I don’t look at these kinds of lists as some sort of worship ritual towards the wealthy, but rather to find out about businesses run by these people I might have overlooked in my never-ending quest for stocks to buy.

When you get to billionaire status you’ve obviously done a lot in your life to make it happen. Most billionaires on the list made it without a family inheritance. Some run private companies. Others have publicly traded investment vehicles. All of them play a role in the global economy.

Rather than find stocks in really interesting companies, why not find really interesting billionaires and invest alongside them? You can bet Jeff Bezos and company are going to succeed far more often than they fail. Not to mention the fact a big chunk of their wealth is tied up in their company’s stock.

Men and women who put their money where their mouths make the best investment partners, don’t you think?

Here then is my list of seven stocks to buy that are run or controlled by billionaires. 

Stocks to Buy: Leonardo del Vecchio, Luxottica (LUXTY)

Source: Eva Rinaldi via Flickr

Leonardo del Vecchio: Luxottica (LUXTY)

The poorest person on my list — Leonardo del Vecchio, at $20.2 billion — founded Luxottica (OTCMKTS:LUXTY) in 1961 in Milan, Italy.

You might not know the name Luxottica, but you likely have heard of Sunglass Hut, the retail shop it uses to sell Ray-Ban and Oakley sunglasses, two of the many brands it has acquired over the years.

In May 2017, Luxottica voluntarily delisted its ADR from the New York Stock Exchange to save costs. Only 3.7% of the company’s worldwide average daily volume was in the U.S. Investors can still buy its shares on the over-the-counter market.

Also, in 2017, Luxottica and Essilor, the world’s largest lens maker, agreed to merge in an all-stock deal that would generate more than $20 billion in annual revenue with more than 140,000 employees around the world.

The merger, making Luxottica a vertically integrated powerhouse, was completed this past October. Del Vecchio is executive chairman and owns 39% of the company.

Stocks to Buy: Elon Musk, Tesla (TESLA)

Source: JD Lasica via Wikimedia Commons

Elon Musk: Tesla (TESLA)

This man needs no introduction. Nor does Tesla (NASDAQ:TSLA), his company, the world’s biggest electric car company.

As both a Canadian and a fan of Musk and the company, I find it gratifying that not only did the billionaire spend some time in Canada during his college years — in his freshman and sophomore years he attended Queen’s University in Kingston, Ontario — he’s got a Canadian girlfriend.

Clearly, his attachment to Canada goes beyond two years of university. A grandmother and aunt live in Alberta and he met his first wife while studying in Kingston.

Geography aside, you either love or hate Musk’s personality. However, regardless of your thoughts on the man’s behavior, what he’s doing with Tesla and electric vehicles will stand the test of time.

In the fourth quarter of 2018, Tesla delivered 90,700 vehicles, 204% more than in the same quarter a year earlier. More than likely the company will generate a second consecutive quarter of profitability, a sign Tesla is gaining traction in the marketplace.

The stock is incredibly volatile but the rewards a decade from now should be tremendous. Of all the stocks on the list, this is the one I’m rooting for the most.

America needs more Tesla’s.

Stocks to Buy: Li Ka-shing, CK Hutchinson Holdings (CKHUY)

Source: Shutterstock

Li Ka-shing: CK Hutchinson Holdings (CKHUY)

If Leonardo del Vecchio is a mystery to most American investors, Hong Kong billionaire Li Ka-shing is an enigma rolled inside of a mystery. Li Ka-shing left school at 16 to support his family. All these years later — the man’s 90 — he’s worth an estimated $27.8 billion and still going strong.

Reading about the various businesses that are part of this multinational conglomerate isn’t something you can do in one sitting. CK Hutchinson Holdings (OTCMKTS:CKHUY) controls companies that operate in telecom, infrastructure, energy, healthcare and many other fields. It employs more than 300,000 people in over 50 countries around the world.

Conglomerates might be on the way out, but don’t tell that to Li Ka-shing and the people working at CK Hutchinson or one of its subsidiaries. Financially, it’s doing just fine. In 2017, CK Hutchinson had $53.2 billion in revenue with $4.5 billion in net income.

It might not be very well known on this side of the pond, but over in Asia it’s a household name.

Stocks to Buy: Larry Page, Alphabet (GOOGL)

Source: Shutterstock

Larry Page: Alphabet (GOOG, GOOGL)

It’s hard to imagine being worth $50.5 billion at 45 years of age and the eighth wealthiest billionaire but that’s exactly where Google co-founder Larry Page sits at the moment.

In contrast, Warren Buffett didn’t become a billionaire until he was 55.

Depending on how Alphabet (NASDAQ:GOOGL, NASDAQ:GOOG) stock performs in 2019, Page could go even higher.

When Page isn’t counting his billions, he’s busy being the CEO of the entire Google network of companies and experiments. That’s not exactly a 9-to-5 job.

Everybody knows about Google’s formidable market share in online advertising — 37% at the end of 2018 — but it is the company’s other bets that hold the most potential.

Take Waymo, for example. It’s the company’s big bet on autonomous driving technology. Analysts believe Waymo could be worth $250 billion to the company, or 34% of its current market cap. That’s up significantly from previous estimates that were half that amount.

A lot has to happen for this to be correct, but if you’re looking fto ride a billionaire’s coattails, Alphabet is one of the best stocks in my opinion.

Stocks to Buy: Bernard Arnault, LVMH, (LVMUY)

Source: Mathieu Lebreton via Flickr

Bernard Arnault: LVMH, (LVMUY)

I’ve never owned LVMH (OTCMKTS:LVMUY), the luxury goods holding company of French billionaire Bernard Arnault, but I probably should because Arnault is in a league of his own when it comes to running a business.

Starting out in the family business, Arnault took a big leap of faith in 1984, acquiring Boussac, a textile company that owned several apparel businesses including Christian Dior. He then went on to make so many acquisitions in fashion, retail, drinks, watches and other industries, it would make your head spin.

His latest example of risk-taking: LVMH has acquired Belmond — the London-based owner of the Orient Express train service as well as luxury hotels in 24 countries — for $3.2 billion.

Skeptics of the deal suggest that it’s one thing to own luxury brands. It’s another to own luxury hospitality. If there’s a businessperson on this planet that can make this work, Arnault is definitely the person to do it.

Stocks to Buy: Warren Buffett, Berkshire Hathaway (BRK.A,BRK.B)

Source: Shutterstock

Warren Buffett: Berkshire Hathaway (BRK.A, BRK.B)

What Bernard Arnault is to luxury goods, Warren Buffett is to insurance. Berkshire Hathaway (NYSE:BRK.A,NYSE:BRK.B) wouldn’t be the company it is today if it wasn’t for the Oracle of Omaha recognizing the beauty of the insurance company float.

Buffett realized that he could use an insurance company’s float — the difference between the premiums collected and the paid out claims — to invest in stocks and other businesses. It’s essentially an interest-free loan by the insurance company’s shareholders.

The downside of float is that you eventually have to repay the money in the form of claims payments. When there are major events like floods or hurricanes, the payouts often far exceed the premiums leading to an underwriting loss.

So, not only was Buffett smart to realize the float’s usefulness beyond the insurance business, he was wise enough to know he needed really smart people running these insurance companies to limit the underwriting losses over the long haul.

In fact, Berkshire Hathaway’s insurance operations are so well run that its float hasn’t cost the company a cent. It was actually paid $2 billion a year between 2002 and 2016 to invest $92 billion in insurance float.

I consider Berkshire Hathaway the world’s cheapest mutual fund. Pay no annual fees but get lots of positive returns. What’s not to like?

Stocks to Buy: Jeff Bezos, Amazon (AMZN)

Source: Shutterstock

Jeff Bezos: Amazon (AMZN)

Jeff Bezos tops the list of the world’s wealthiest people. Even if he gives away half of his estimated wealth of $125 billion to his wife Mackenzie as part of any divorce settlement the couple might agree to, Bezos would still be the fifth-wealthiest person on the planet.

That is a staggering amount of wealth.

The founder of Amazon (NASDAQ:AMZN) has seen his personal wealth mushroom in recent years as the company’s continued to prosper and free cash flow’s accelerated.

Consider this. In 2008, Bezos’ estimated net worth was $8.2 billion. The company’s free cash flow that year was $1.4 billion. In 2017, it was $8.4 billion. That might not seem like a lot until you consider that Amazon’s capital expenditures were only $333 million in 2008 compared to $5.4 billion in 2017.

Bezos and any other Amazon shareholder who held the entire period got much wealthier indeed.

Between online retail, Whole Foods, advertising and many other Amazon initiatives, he could become the world’s first trillionaire. Divorce shouldn’t slow him down.

As of this writing Will Ashworth did not hold a position in any of the aforementioned securities.

Source: Investor Place

Amazon Stock Will Hit $10,000 Sooner Than You Think

This time last year, I predicted that Amazon’s (NASDAQ:AMZN) business would continue to grow at a rapid pace, pushing AMZN stock all the way to $10,000.

Of course, I wasn’t suggesting it would happen immediately. Rather, it might take as long as 7.5 years to get there, which would still result in an annualized return of 33% for Jeff Bezos and company.

“In my estimation, if it took 7.5 years to get to $1,000 from $100, I see AMZN stock getting to $10,000 somewhere between January 2023 and January 2025.“

In September, the markets went into full-on bear mode, knocking the S&P 500 for a 14% loss, making it the worst quarter for the index since 2008, and in the process, putting it into negative territory (-7%) in 2018. Talk about a reversal of fortune.

How did AMZN stock fare in the fourth quarter? It lost 25% to close well down from its 52-week high of $2,050.50. No matter. Early in 2019, Amazon’s managed to regain some of those losses — it’s up 7.8% year-to-date through the Jan. 9 close.

Like a young child taking learning to walk, step by step, Amazon will get back on the path to $10,000. In fact, it needs only a couple of its big initiatives to be successful to reach the lofty goal sooner rather than later.

Here are two of them:

Amazon’s Push Into Advertising

When investors name-drop companies in online advertising, two names come to mind: Facebook (NASDAQ:FB) and Google, part of Alphabet (NASDAQ:GOOGL, NASDAQ:GOOG).

Facebook and Google account for 58% of the U.S. online advertising market. Together, the two firms generated approximately $61 billion in ad revenue in 2018. Way down in third place with 7%market share of U.S. digital ad spending is Amazon — but it’s coming on like a house on fire. Forecasts suggest that Amazon ad revenues could hit $38 billion annually by 2023.

While Amazon has little chance of catching the duopoly that is Facebook and Google, it stands a good chance of becoming a strong third wheel.

“My understanding from speaking with people in the industry is that Amazon’s retail, subscription-based and advertising revenues are fairly fluid,” said Pivotal Research senior analyst Brian Wieser. “Amazon will optimize revenue streams and profitability based on what it sees from consumers.”

So while Facebook and Google are heavily dependent on advertising, Amazon has stuff like Amazon Web Services (AWS) — $5.1 billion in operating income in the first nine months of its latest fiscal year — that are highly profitable to lean on while building some of its other businesses such as advertising.

Jeff Bezos has become a master allocator of capital, stoking the fires that need stoking, and in the process, making Amazon extremely nimble and able to act on its best ideas.

Amazon Go

The cashier-less convenience store concept Amazon began rolling out in 2018 is going to revolutionize the industry. Amazon, which expects to open 3,000 stores by the end of 2021, could generate as much as $4.5 billion in annual sales from these stores in three years’ time. According to RBC Capital Markets, the average Amazon Go store does $1.5 million in annual sales.

Not bad for a store concept that doesn’t need any front-of-store personnel.

“Amazon Go stores could be a game changer for physical retail experience. Its in-store technology enables shoppers to have a very efficient and pleasant shopping experience,” RBC analyst Mark Mahaney wrote in a note to clients. “While not a significant financial contributor yet, we believe the overall opportunity is huge.”

Darn straight.

The convenience store industry hasn’t changed in 25 years. Those aren’t my words — they’re Alimentation Couche-Tard (OTCMKTS:ANCUF) CEO Brian Hannasch’s.

“The experience of buying fuel and of buying items in our stores has largely been unchanged since card readers were introduced 25 years ago,” Hannasch said in a November story in ConvenienceStore News. 

The convenience store business might not be as sexy as Whole Foods, but it’s got the potential to engage Amazon Prime customers wherever they live.

The stores themselves might generate $4 billion in sales, but it’s the free advertising Amazon gets to attract more Prime members that’s the real key to Amazon Go’s ultimate success.

Everything Amazon does revolves around Prime. 

The Bottom Line on AMZN Stock

Nothing Amazon does surprises me anymore. It’s got a great business model and is using technology to innovate old-school industries like grocery, convenience stores, healthcare — the list goes on. I could actually see Amazon stock hit $10,000 within five years, two-and-half years sooner than I suggested last January. However, it’s got to nail at least one of these initiatives to have a chance.

As of this writing, Will Ashworth did not hold a position in any of the aforementioned securities.

Canopy Growth Stock And Its Sister Company Are Both Attractive

marijuana stock

Source: Shutterstock

There’s no doubt that Canopy Growth (NYSE:CGC), stock is one of the best bets among Canadian cannabis companies, thanks in large part to the substantial financial support that the company is getting from Constellation Brands (NYSE:STZ).

In July, I suggested that interested investors hedge their bets on Canopy Growth stock by buying equivalent amounts of CGC stock and Constellation stock.

The Bigger Picture

If you feel strongly about the marijuana industry’s future growth, the smart move would be to take the amount you are prepared to lose on Canopy Growth and cut it (in) half, putting 50% into CGC stock and the other 50% into Constellation Brands,” I wrote on Jul. 5.

“Long-term, I think you’ll be pleased with your decision to hedge your bet.”

A $10,000 bet on CGC stock made on Jul. 5 earned $221 through December 14. A 50/50 split between CGC stock and Constellation lost $688 due to a 16% decline in STZ stock over the last five months; analysts have become wary of Constellation’s $4 billion investment in Canopy.

“Branding will be key to unlocking value in cannabis business, but the winners are far from clear,” said Macquarie analyst Caroline Levy in November. “It thus seems difficult to see any near-term profits for Canopy and possibly sub-par returns for many years, if it continues to prioritize sales growth and market share.”

That is precisely why I recommended that investors hedge their bet in the first place. If Canopy Growth stock doesn’t fly, Constellation will take a hit in the short-term, but over the long-term, STZ will be fine.

If you put all your eggs in one basket, you could end up with a big goose egg.

Another option, which I’ve suggested before, is to buy a cannabis ETF like ETFMG Alternative Harvest ETF (NYSEARCA:MJ). ETFs spread the risk beyond CGC stock.

An Option for Risk-Tolerant Investors

Unless you follow Canopy Growth stock closely, you’ve likely never heard of Canopy Rivers (OTCMKTS:CNPOF), a Toronto-based venture capital investment firm. Canopy Rivers makes investments in best-in-class private and publicly-traded companies across the cannabis value chain, from producers to marketers and everything in between.

CGC owns approximately 25% of Canopy Rivers’ stock. Bruce Linton, the co-founder and CEO of Canopy Growth, is acting CEO of Canopy Rivers. 

Canopy Growth’s consulting firm, XIB Consulting Inc, provides deal flow to Canopy Rivers. The two principals of XIB, Sean McNulty and Peter Hatziioannou, own shares in Canopy Rivers

“We decided to create a separate vehicle where we would could take minority interests, create alternative transaction structures and provide both growth capital and strategic support,” McNulty said about Canopy Rivers in November.“The deal flow is sometimes overwhelming. We’ve evaluated hundreds and hundreds of opportunities, but we’re very picky because we’re trying to get it right for every investment.”

So far, XIB has found 11 investment opportunities for Canopy Rivers. If the U.S. federal government legalizes pot, which most expect will happen sooner rather than later, McNulty and Hatziioannou will have to hire more professionals to carry out due diligence.

That would be a great problem to have.

The Bottom Line on CGC Stock

I believe the CGC-Constellation tie-up is a good one for both companies’ shareholders.

As for Canopy Rivers, if you’re more risk-tolerant, the shares provide a compelling investment opportunity after losing 57% of their value since their public debut on Sept. 20.

However, I wouldn’t use a retirement investment vehicle to buy CGC stock because you won’t be able to deduct any capital losses from your taxes.

As of this writing Will Ashworth did not hold a position in any of the aforementioned securities.

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Source: Investor Place

7 Stocks to Buy After the Drop

Is the stock market reasonably priced or expensive? That’s the question investors are asking themselves these days, leaving many to wonder if there are any stocks to buy at this point in the cycle.

A couple of metrics have investors scared about stock prices, suggests Jim Paulsen, the chief investment strategist at The Leuthold Group. According to Paulsen, the median U.S. stock has a P/E multiple today that is almost 50% more expensive than during the bubble of 2000.

The second metric that should make you think twice is the value of U.S. stocks relative to foreign stocks. Paulsen suggests that U.S. stocks are 17% more expensive than foreign stocks, the highest spread since 2002. Also, the price-to-sales ratio hasn’t been this high since the end of World War II. Marijuana stocks are definitely contributing to this third metric.

So, what’s an investor to do?

Ben Graham used to talk about a margin of safety to protect against the potential downside of owning a stock. That’s especially true when a re-evaluation of stock prices will eventually take place.

In the past, I’ve followed stocks that have dipped by more than 10% in a certain period — a week, a month, a quarter — and what I’ve found is that they often recover over a period of months. Shortly after that, they often test 52-week or all-time highs.

It’s not a strategy I’d pursue if you’re an anxious investor, but for those people who can handle a little volatile, here are seven stocks to buy that are down 20% or more over the past three months.

The Stars Group (TSG)

The Stars Group (TSG)

Source: Shutterstock

3-Month Performance: -31%

It’s hard to believe that The Stars Group (NASDAQ:TSG) stock is still up over 9% year to date despite a 31% rout over the past three months.

If you bought TSG stock in July, I feel your pain, because your position is seriously upside down.

Not to fear, it will soon be back over $30. Here’s why.

In July, it completed its $4.7 billion acquisition of Sky Betting & Gaming, one of the leading gaming and sportsbook operators in the UK. The purchase not only gives it a bigger foothold in Europe, but it also cements its position within the lucrative sports betting market that’s ready to take off in the U.S.

Yes, the deal required the company to leverage itself to the hilt while also diluting shareholders to pay for Sky Betting & Gaming, but I believe this is this kind of transformational move that separates the professionals from the amateurs.

The future of online gaming is tremendous. Any correction like the one over the past three months is an opportunity to buy TSG stock at a reasonable price.

Zillow Group (ZG)

Zillow Group (ZG)

Source: Shutterstock

3-Month Performance: -31%

In early August, Zillow Group (NASDAQ:ZG) stock dropped 16%, its worst single-day performance since November 2011.

What sparked the selloff?

The company reported its Q2 2018 earnings. The top-line missed slightly while the bottom-line beat expectations by three cents. That wasn’t it.

It did, however, lower its guidance for the full-year from at least $1.43 billion in revenue to $1.32 billion, a drop of $110 million. Add to that its entry into the mortgage lending market through the acquisition of Mortgage Lenders of America, which prompted a downgrade from Merrill Lynch because of the stress it will put on profits, was enough to send the stock spiraling lower.

Zillow Group is moving away from its traditional areas of strength — Advertising and technology applications — into the buying and selling of homes through Zillow Offers, hence the need for a mortgage lender.

“It allows us to monetize the Zillow Offers business a second way,” Zillow CEO Spencer Rascoff said in August on CNBC. “First, we can make money from buying and selling. Second, we can make money from mortgage origination. Third, we can make money by passing the homeseller, who doesn’t want to sell their home to us, off to a premier agent.”

Personally, I’ve been a fan of Zillow stock since 2013. I like what Zillow Offers does for the house seller.

I think the market’s got it wrong. Those willing to experience a little volatility through the remainder of 2018 should be rewarded with a higher stock price.

Noah Holdings (NOAH)

3-Month Performance: -27%

I first recommended Noah Holdings (NYSE:NOAH), a Chinese wealth management company, back in June 2013 when it was trading around $13; it’s now over $40 despite the 27% haircut in the past three months.

“The most compelling reason for investing in Noah Holdings is its revenue structure, which has evolved over time since its inception,” I wrote June 6, 2013. “Three years ago it earned 77.2% of its revenue from one-time commissions from the third-party firms it represented, with the remainder in recurring service fees. Today, it earns almost 46% of its revenue from recurring service fees.” 

Fast forward to 2018.

NOAH earns about 41% from recurring service fees, 41% from commissions, about 6% from performance fees and the rest (12%) from its online brokerage and education business.

Investors likely weren’t impressed with the company’s drop in earnings in the second quarter.

However, as a glass-half-full type of person, I look at its online brokerage and education business’s results in the second quarter — revenues were 73% higher with half the operating losses year over year — and see a stock that’s ready to rebound.

At less than $40, it’s a steal.

Ultrapar (UGP)

Ultrapar (UGP)

Source: Shutterstock

3-Month Performance: -25%

A year ago, Ultrapar (NYSE:UGP) was trading above $25. Today, it’s below $10.

What the heck is going on at the Brazilian conglomerate?

Well, Brazil and the rest of South America haven’t exactly been a beacon of stability in recent months. However, the issues that prevent Brazil’s economy from really taking off — low productivity, political corruption and too much spending by governments — have been around for years, making it very difficult for businesses to grow there.

However, a quick look at Ultrapar’s Q2 2018 report suggests business is just fine at most of its operating segments.

If not for a strike by truck drivers across Brazil in May, making it impossible to get fuel to its gas stations, the company’s adjusted EBITDA would have increased by 18% in the second quarter, and revenues likely would have been up more than the 19% year over year increase.

Ultrapar runs gas stations, convenience stores, pharmacies, liquified petroleum gas, specialty chemicals and a liquid bulk storage business.

It has been around for almost 80 years and will probably be around for another 80 years.

Mastec (MTZ)

Mastec (MTZ)

Source: Shutterstock

3-Month Performance: -21%

New Jersey-based CressCap Investment Research provides independent analysis of over 7,000 stocks using statistics and data to help separate the winners from the losers. In May, CressCap CEO Steven Cress suggested Mastec (NYSE:MTZ) would be a big beneficiary of U.S. President Donald Trump’s push to rebuild America’s infrastructure.

Like much of the president’s economic agenda, it relies more on style than substance. The odds of a trillion-dollar-plus infrastructure bill getting passed anytime soon is fair at best.

That said, I do agree with Cress that the infrastructure construction firm is ideally positioned to benefit from any large infrastructure projects initiated by the federal government.

The company’s Q2 2018 results show a business that’s experiencing declining revenue and EBITDA, a big no-no in an economy that’s booming and corporate earnings are at a record level.

However, look more closely at its earnings and revenue, and you’ll see a business that’s doing just fine. With a $7.7 billion backlog at the end of June, Mastec has plenty of work ahead of it without the assistance of the president.

Down 21% over the past three months, now is an excellent time to consider MTZ stock. 

Tata Motors (TTM)

Tata Motors (TTM)

Source: Shutterstock

3-Month Performance: -23%

The year-to-date price chart for Tata Motors (NYSE:TTM) stock looks a lot like a ski run in that it’s downhill all the way. The maker of Jaguars and Land Rovers started the year at $35 and now it trades for half that.

It seems like the turnaround job Tata Motors executives performed on Jaguar Land Rover (JLR) between 2008 and 2015 has been forgotten by investors; an amazing thought considering all of the beautiful cars it has released over the past two years.

I believe JLR makes the perfect spinoff stock for investors to bet on; the news that Aston Martin’s looking to go public with a $6.7 billion valuation suggests the investor appetite for luxury cars is high at the moment.

That said, it better not wait too long, or Volvo might reconsider shelving its plans for an IPO.

The other fly in the ointment for Tata Motors: As it ramps up spending at JLR, Fitch is concerned that Tata’s free cash flow will turn negative, putting a damper on future profits.

I think the risk-to-reward ratio is good at prices under $20.

Acadia Healthcare (ACHC)

Acadia Healthcare (ACHC)

Source: Shutterstock

3-Month Performance: -19%

If there’s a company whose services are needed in America, Acadia Healthcare (NASDAQ:ACHC) has got to be at the top of the list. Acadia provides inpatient and outpatient behavioral health services to people in the U.S. and UK. Whether it’s anxiety, an opioid addiction, PTSD or something else, Acadia is there to help. 

Not only does Acadia provide the care, but it also owns many of the facilities where this care takes place.

As you can imagine, Acadia’s biggest expense is wages. After all, you can’t help people without providing professional care, and that costs money.

Its revenues grow at a reasonable pace and deliver about 7 cents to the bottom line for every dollar of revenue. It’s not a tech company to be sure, but it serves a vital service whose need won’t go away anytime soon.

Its stock dropped in July after the company’s CEO reduced its revenue and earnings guidance for 2018 as a result of higher interest rates and foreign exchange.

Those two items are a natural part of doing business. I see the company’s stock rebounding from this latest concern in the final months of 2018 and into 2019.

As of this writing Will Ashworth did not hold a position in any of the aforementioned securities.

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Buffett could see this new asset run 2,524% in 2018. And he's not the only one... Mark Cuban says "it's the most exciting thing I've ever seen." Mark Zuckerberg threw down $19 billion to get a piece... Bill Gates wagered $26 billion trying to control it...
What is it?
It's not gold, crypto or any mainstream investment. But these mega-billionaires have bet the farm it's about to be the most valuable asset on Earth. Wall Street and the financial media have no clue what's about to happen...And if you act fast, you could earn as much as 2,524% before the year is up.
Click here to find out what it is.

Source: Investor Place 

3 Stocks to Buy If Trump Is Impeached

On Aug. 21, Michael Cohen, Donald Trump’s former personal attorney, pled guilty to two felony campaign finance violations, setting in motion a chain of events that could lead to President Donald Trump’s impeachment along with several “Trump impeachment stocks” to consider.

As far as I’m aware, if the president were removed from office by Congress, Mike Pence, the vice president, would become the new leader.

Under such a scenario, it’s possible that the White House’s economic policies wouldn’t change much, so the idea of benefitting from Donald Trump being stripped of his presidency and recommending three stocks to buy for a Trump impeachment could be a moot point.

That said, I don’t see Mike Pence being nearly as combative with America’s allies, which would mean a return to more normal diplomatic and economic relationships. That’s good news for any company currently suffering under the Trump administration’s protectionist tariffs.

America might be doing well today, but many experts suggest long-term, Trump’s trade policies are bad for business.

So, without further delay, these are the three stocks I believe are most likely to benefit from Trump’s removal from office:

Trump Impeachment Stocks: Harley Davidson (HOG)

Stocks to Buy if Trump Is Impeached: Harley-Davidson

Source: Shutterstock

I don’t think there’s any doubt that Harley Davidson (NYSE:HOG) would benefit from anybody but Donald Trump running the country.

The fact that the president would support the boycott of such an iconic brand just because the company chooses to make some of its bikes closer to its growth markets in Europe and elsewhere is evidence of the man’s failure to grasp simple business.

“Many @harleydavidson owners plan to boycott the company if manufacturing moves overseas. Great!” Trump tweeted on Aug. 12. “Most other companies are coming in our direction, including Harley competitors. A really bad move! U.S. will soon have a level playing field, or better.”

The truth of the matter is that companies who choose to manufacture in the U.S. do so, not because America makes products better than anyone else, but because they want to be closer to their customers.

It makes very little sense to sell a bike in Prague that’s made in Wisconsin. That said, if Trump hadn’t implemented the steel and aluminum tariffs, the EU wouldn’t have slapped a 31% tariff on U.S. motorcycles, and Harley likely wouldn’t have been nearly as quick to move some of its manufacturing overseas. 

I don’t know if Mike Pence understands economics any better, but I’m guessing Harley would like to find out.

Trump Impeachment Stocks: Fiat (FCAU) and the Auto Industry

Stocks to Buy if Trump Is Impeached: Fiat and Auto Stocks

Source: Shutterstock

This one isn’t so much a specific stock as it is a particular industry.

The president seems eager to undo anything that was created or achieved by the Obama administration. He loves the words, “Roll back the Obama policy,” almost as much as MAGA. To heck with the consequences. 

Recently, one of the great CEOs of modern business, Sergio Marchionne, died at the age of 66. President Trump might not like to hear this, but if it weren’t for Obama going against some of his advisors’ advice and opting for a bailoutFiat Chrysler Automobiles (NYSE:FCAU) might not exist today.

Just ask the good people of Windsor, Ontario, where they make a ton of Chrysler vehicles, what they think of Marchionne and praise is all you’ll hear. 

“There was a Great Recession, folks had lost confidence in Chrysler as a company,” said Windsor Mayor Drew Dilkens after Marchionne’s death July 25. “But he said, ‘You know what, I see a possibility.’ So, he took a leap that not many others were willing to take, and he took over Chrysler.”

The other thing people forget is that Fiat wasn’t exactly humming along when Marchionne proposed the merger. So, what does Mr. Trump want to do? He wants to slap a 25% tariff on cars coming from Canada and elsewhere.

Both Canadian and American auto parts suppliers would suffer under such a tax as would Fiat Chrysler and the rest of the Detroit automakers. And Windsor, Ontario? It would be crippled.

The entire North American auto industry benefits from a Trump impeachment.

Trump Impeachment Stocks: Amazon (AMZN)

Stocks to Buy if Trump Is Impeached: Amazon

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The third company to benefit from a Trump impeachment would be Amazon (NASDAQ:AMZN); not that it needs any help because the president’s aggressive attacks against the e-commerce giant have put it in the spotlight for all the wrong reasons.

“Only fools, or worse, are saying that our money-losing Post Office makes money with Amazon. THEY LOSE A FORTUNE, and this will be changed,” Trump tweeted April 2. “Also, our fully tax-paying retailers are closing stores all over the country … not a level playing field!”

Hmm … Isn’t Amazon the same company that’s opening a second U.S. headquarters that will employ as many as 50,000 employees at a projected cost of $5 billion?

I’m pretty sure that the VP wouldn’t be nearly as hard on the Seattle company knowing that it employs more than 9,000 people in Pence’s home state of Indiana. And it’s adding jobs at its five fulfillment centers in the state.

I thought Trump liked companies who’re creating American jobs?

As of this writing, Will Ashworth did not hold a position in any of the aforementioned securities.

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Source: Investor Place

7 Stocks Warren Buffett Would Approve Of

Geico’s former chief investment officer, Lou Simpson, was at one point seriously considered by Warren Buffett as a possible successor to the long-time Berkshire Hathaway Inc. (NYSE:BRK.A, NYSE:BRK.B) CEO. Simpson retired in 2010, but he grew bored of life away from the office and set up SQ Advisors, a Naples-based investment advisory firm with his wife Kimberly Querrey.

As of the end of March, it had $2.9 billion in assets under management invested in just 15 companies; one of them being Berkshire Hathaway.

Although Simpson likes a concentrated portfolio of fewer than 20 stocks, it’s the way he evaluates a company that’s made him so successful.

“As Warren used to tell me, ‘You’re better off being approximately right than exactly wrong,” Simpson told a Northwestern University business school audience in 2017. “For example, one thing you need to determine is: Are the company’s leaders honest? Do they have integrity? Do they have huge turnover? Do they treat their people poorly? Does the CEO believe in running the business for the long term, or is he or she focused on the next quarter’s consensus earnings?”

Equally important, Simpson believes, is to hold your winners indefinitely, while selling your losers as fast as you can.

In February, I highlighted seven stocks to buy from Simpson’s portfolio. Now, I’ll recommend seven more.

Warren Buffett’s Former Money Guy Loves: CarMax (KMX)

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If you’ve bought a new car recently, you know how expensive they can be, which is a big reason why used-car sales remain strong.

CarMax, Inc (NASDAQ:KMX) is the largest retailer of used cars in the U.S. In fiscal 2018 it sold 721,512 vehicles at retail and another 408,509 vehicles through wholesale auctions at 73 of its 188 stores across the country.

While the number of used vehicles it sold in the fourth quarter was down 3.1% year over year, it still managed to sell 7.5% more vehicles at retail in fiscal 2018 along with a 4.3% annual increase from its wholesale auctions.

In 2018, it made $2,173 per used vehicle at retail, 10.9% higher than a year earlier while its wholesale auctions brought in $961 per vehicle, a 3.9% increase over 2017. Car Max makes more money per car than all of its competitors.


“What makes CarMax such a draw for used car buyers is excellent marketing that espouses a low-stress, hassle-free car buying experience,” wrote Jalopnik’s Tom McParland May 30. “The crux of the CarMax strategy is the “no-haggle” pricing. The price you see is what you pay.”

By providing the biggest inventory and knowing how to price its vehicles, CarMax makes more than anyone else. As wide-moat businesses go, this is a good one.

Warren Buffett’s Former Money Guy Loves: Apple (AAPL)

In February 2017, Apple Inc. (NASDAQ:AAPL) was trading around $129. Apple had just delivered strong first-quarter earnings that included an 18% increase in its services revenues to $7.2 billion.

At the time, I reasoned that the recurring revenue it generates from its services segment deliver really sweet gross margins, suggesting that AAPL stock would hit $200 sometime in the future.

Fifteen months later, Apple is trading within $7 of $200 and Warren Buffett is now its third-largest shareholder.

Recently, Apple CEO Tim Cook has been very upfront about the responsibility it has protecting its customers’ data. While I’m not sure the company’s stance is an altruistic one, but rather a smart reading of which way the privacy winds are blowing, I do think it helps ingratiate itself to its loyal group of customers and that more than anything should help the company continue to grow for years to come.

The fact that Buffett’s bought into Apple in such a big way says everything about Apple stock and why you should own it.

Warren Buffett’s Former Money Guy Loves: Sensata Technologies (ST)

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This is one company I honestly didn’t know about and that’s rare in my line of work writing about stocks.

Sensata Technologies Holding PLC (NYSE:ST) is a manufacturer of high-margin sensor products for the automotive and aerospace industries. In Q1 2018, all three of its operating segments had healthy organic revenue growth of 4.5% in its auto segment — the largest generating 60% overall — to 14.5% growth in its heavy vehicle off-road segment.

In the first quarter, it had adjusted net income of $147.0 million on $886.3 million in revenue for a 16.6% net margin, 160 basis points higher than a year earlier.

Importantly, the company converts almost all of its net income into free cash flow. This, along with record margins, suggests a price-to-cash-flow multiple of 16.7 isn’t unreasonable.

Doing well in China and playing in some of the hottest areas in technology today, I can see why Simpson likes Sensata’s stock.

Warren Buffett’s Former Money Guy Loves: Charter Communications (CHTR)

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The big question investors consider when it comes to investing in cable companies is the extent to which cord-cutting is hurting sales.

Charter Communications Inc (NASDAQ:CHTR) is no exception. Its stock is down 31% from its one-year high of $408.83 in August 2017 as a result of these concerns.

However, and it’s something I’ve often wondered when are the cable companies going to start raising broadband costs for customers who drop cable?

Apparently, it’s already happening. Accoring to Ars Technica, Comcast Corporation (NASDAQ:CMCSA) is increasing broadband speeds significantly for customers in Houston and Oregon at no extra cost — but only for those customers who also subscribe to TV.

“Cord cutters are not invited to the [speed increase] party,” wrote the Houston Chronicle in April. “Only those who bundle Internet with cable television and other services… will see their speeds go up at no extra charge.”

Charter’s ability to raise prices along with lower capital costs in the future after spending a considerable amount upgrading its network should help its stock move higher in the year ahead.

Warren Buffett’s Former Money Guy Loves: Liberty Broadband (LBRDK)

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It’s only natural for Simpson to own Liberty Broadband Corp (NASDAQ:LBRDK) given it owns 23% of Charter Communications stock as well as 100% of Skyhook Holding, which provides a positioning service to find mobile devices as well as a geospatial intelligence service for the real estate and other geography-related industries.

Liberty Broadband was spun-off from Liberty Media in November 2014. It acquired its original $2.6 billion position in Charter in May 2013 at $105.62 a share. Since then it’s added an additional 29.8 million shares at prices slightly less than $200 a share.

Liberty Broadband’s invested around $8 billion in Charter, an investment that’s now worth over $18 billion and growing.

Clearly, Simpson feels it’s worth a lot more, or he wouldn’t be holding either stock.

Warren Buffett’s Former Money Guy Loves: Axalta Coating Systems (AXTA)

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It’s not been a good year for Axalta Coating Systems Ltd (NYSE:AXTA).

In November, Axalta and Akzo Nobel N.V. (ADR) (OTCMKTS:AKZOY) called off merger talks between the two companies that would have seen Akzo Nobel’s paints and coatings business merge with Axalta.

Unfortunately, the two parties got stuck on price and decided to move on. Before the talks were canceled, Axalta shares were trading higher than $38. Since then they’ve lost almost 20% of their value.

However, the coatings business remains strong providing a good entry point for investors.

In April, I included Axalta in a group of ten stocks I put together for an all-cap portfolio. One of three mid-cap stocks, here’s my rationale for owning Axalta.

“Berkshire Hathaway owns a little more than 23 million shares of Axalta, which the company has owned since it bought most of them in a private deal in 2015 for $28 a share,” I wrote April 10. “Now finally making money on his investment, it’s possible that Buffett, as the largest shareholder, could buy the entire company to combine with its Benjamin Moore paint business.”

Despite having different investment philosophies, Simpson and Buffett sure own a lot of the same stocks.

Warren Buffett’s Former Money Guy Loves: SBA Communications (SBAC)


Source: Shutterstock

SBA Communications Corporation (NASDAQ:SBAC) acquires long-term ground leases around the world so that it can erect cell towers that wireless carriers lease space on to transmit their signals to mobile customers.

The company makes money in several ways, the two primary ones being the construction of the towers and the leasing of the space on those towers. It also makes money helping wireless companies find new leasing opportunities when needed as well as from the sale of ground leases, etc.

It might seem like a simple business but it’s very capital intensive and requires a great deal of manpower to maintain all of the towers, etc. It’s not an easy business to enter without major financial backing.

It’s hard to know exactly why Simpson exited from most of his position in the second quarter. Now the second-smallest holding at just $876,000 as of the end of March; Simpson’s SBA stock was worth almost $200 million at the end of 2017. Buying a year ago for around $139 million, Simpson’s made about 44% on his one-year investment.

My guess is he wanted to reap the quick rewards and redeploy the funds into another stock he liked better.

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7 More of the Best Retirement Stocks No One Talks About

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Are you having a hard time selecting the best retirement stocks for your portfolio? If so, you’re not alone.

Last April, I recommended seven of the best retirement stocks no one talks about. These were companies with market caps greater than $2 billion yielding 1.5% or more delivering five consecutive years of operating profits and thinly traded at 500,000 shares in average daily volume.

Some of them you’re familiar with and some you might haven’t a clue what they do.

Together, the seven stocks averaged a one-year total return of 7.7% with just two stocks in negative territory; all of them I’d have no problem owning today, including EPR Properties (NYSE:EPR), which has lost one-fifth of its value over the past year.

Unfortunately, the SPDR S&P 500 ETF Trust (NYSEARCA:SPY) nearly doubled the group’s performance at 14.8%.

Undeterred, I’ve selected seven more of the best retirement stocks no one talks about. Only this time, I’m going to up the average daily volume ceiling to a million shares instead of 500,000 to see if we can’t come up with some even better options.

Best Retirement Stocks: Honda (HMC)

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Yield: 2.5%

Even though car and truck sales have begun to slow after several years at a torrid pace, Honda Motor Co Ltd (ADR) (NYSE:HMC) is a great long-term buy because its vehicles remain with car-buying consumers.

The company set record U.S. sales in March despite both the Accord and CRV, which generated 43% of its volume overall, were down 13.1% and 6.5% respectively.

Not to worry, the Acura redesigns of both the TLX and RLX helped save the day; Acura’s March sales increased by 15.7% to 13,537 vehicles with over half from its SUVs.

Fear not, the Accord and CRV aren’t losing their popularity with consumers. The company chose to offer very little in the way of incentives in March on both vehicles. As we head into summer, Honda’s U.S. business will pile on the incentives and sales will come as a result.

In the third quarter ended December 31, 2017, Honda’s revenues increased 13.0% to $35.1 billion, while operating profits increased 37.0% to $2.5 billion.

For the entire fiscal year, Honda expects revenues to increase by 8.6%, while operating profits will decline by 7.8% as a result of pension plan changes and the settlement of its airbag class action suit. Take those out and it should make $913 million, an increase of 8.6% over last year.

Year-to-date it’s outperforming its peers by 215 basis points through April 10.

Best Retirement Stocks: Diageo (DEO)

Dividend Yield: 2.4%

Last year, I had the opportunity to trash a certain ETF only to change my mind less than eight months later.

The ETF in question?

The Spirited Funds/ETFMG Whiskey & Spirits ETF (NYSEARCA:WSKY), a collection of global companies manufacturing alcoholic drinks, including Diageo plc (ADR) (NYSE:DEO), the fund’s largest holding with a weighting of 17.5%.

Originally, I thought it was an expensive way to invest in the global trend to premium liquor brands, suggesting an investment in Diageo would do the same thing without having to pay a management fee.

Over the past year, the ETF generated an annualized total return of 29.6% compared to 25.1% for Diageo and 15% for the S&P 500.

Although I still believe an investment in Diageo is a great way to bet on the future success of premium spirits, you could make a lot worse investment decisions over the next few years than buying the WSKY ETF.

For those of you that care about the issue of gender pay equality, which I do, Diageo’s Great Britain unit has a gender pay gap of –9.8%, which means women at the company on average earn more than men. It is not, however, a reflection of equal pay for similar work.


Best Retirement Stocks: Canadian Imperial Bank of Commerce (CM)

Dividend Yield: 4.7%

The five big Canadian banks have long been regarded as some of the best-run financial institutions in the world, in large part a result of escaping the 2008 economic crisis relatively unscathed.

As risk-takers, Canadian banks rank well down the list, but for investors seeking juicy dividend yields, they’ve made wonderful investments.

In May 2012, I wrote Canada’s Banks: Better Than Most in which I took a quick look at the Canadian Imperial Bank of Commerce (NYSE:CM) and how it fared in comparison to JPMorgan Chase & Co. (NYSE:JPM), two banks that ranked highly in Bloomberg Markets’ second-annual rating of the World’s Strongest Banks.

CIBC was third; Jamie Dimon was 13th.

Also, in that piece, I highlighted three Canadian banks doing a lot of business in the U.S. — CIBC wasn’t one of them.

Well, that has changed in a big way in the past two years.

First, it paid $5 billion to acquire Chicago-based Private Bancorp in June 2017, a move that ups CIBCs U.S. profits to 10% of its overall profits. Eventually, the bank hopes to generate 25% of its annual profits in the U.S.

As Canadian banks go, CIBC is my favorite, and not just because it yields the most.

Best Retirement Stocks: Equity Lifestyle Properties (ELS)

Best Retirement Stocks: Equity Lifestyle Properties (ELS)

Source: Shutterstock

Dividend Yield: 2.5%

Of the seven best retirement stocks I’m recommending in this article, Equity Lifestyles Properties, Inc. (NYSE:ELS) would have to be the most boring, yet enticing option of the bunch.

Over the past decade, ELS stock has seen just one negative annual return, and that was a 14% drop in 2008. That year, the S&P 500 lost 37% and its residential REIT peers were off 23%.

All of this from owning land for manufactured home communities, RV resorts and campgrounds across North America. The company was founded in 1969, but it was only after billionaire Sam Zell and partners got involved in 1983, did business really begin to cook.

Since 2008, revenues have doubled to $912 million; operating earnings have more than doubled to $297 million, and dividends have increased five-fold to $1.95 a share.

It has got a wide-moat so large I suggested Warren Buffett should buy it last August.

ELS is the stock you put in a drawer and marvel at how it has grown ten years from now.

Best Retirement Stocks: Grupo Aeroportuario Del Pacifico (PAC)

Dividend Yield: 4.5%

Another stock I recommended Warren Buffett should buy is Grupo Aeroportuario Del Pacifico (NYSE:PAC), an owner and operator of airports based in Guadalajara, Mexico.

Heck, Buffett owns four airline stocks worth almost $10 billion, so a natural extension of that from an infrastructure standpoint would be to buy some of the airports these airlines fly in and out of.

PAC has a little of everything in terms of the types of airports it owns. Guadalajara and Tijuana serve the people living in those major Mexican cities; smaller airports in places like Mexicali and Morelia serve medium-sized Mexican cities; and airports such as Puerto Vallarta and Las Cabos service the tourist trade.

It’s a nicely diversified customer mix that keeps the company and stock moving higher. Over the past five years, PAC delivered an annual total return of 14% to shareholders.

In early January, PAC announced it had obtained long-term financing to make improvements at its Montego Bay airport in Jamaica, one of only two outside Mexico.

Like a lot of the airlines, Mexican airlines continue to grow the number of planes and flights they operate. In conjunction with a number of U.S. low-cost carriers adding flights into Mexico, the company’s future prospects look very good.

However, given the U.S. immigration policy combined with the negative effects of a renegotiated NAFTA agreement, PAC is not without some risk.

Best Retirement Stocks: Wyndham Worldwide (WYN)

Best Retirement Stocks: Wyndham Worldwide (WYN)

Source: Shutterstock

Dividend Yield: 2.4%

Operating one of the largest networks of hotel rooms in the world, Wyndham Worldwide Corporation (NYSE:WYNannounced in 2017 that it would spinoff the hotel group from its vacation ownership and vacation rental business, to create two independent publicly traded companies.

The separation is expected to happen any day now. Shareholders of WYN will get a pro rata distribution of the new hotel company’s stock.

As part of this move, it announced more of its hotel brands will get the “by Wyndham” moniker added to their nameplates. A total of 12 hotel brands are receiving the change including Super 8, Days Inn and the more upscale Dolce brand.

Why am I recommending a stock set to split in two?

Empirical evidence suggests that spinoffs often before better post-spin than pre-spin. In this case, Wyndham is taking a risk by adding its name to some of its value brands, but the company is boosting its franchise operations by 20% to ensure that all of its hotels are meeting the Wyndham standard.

InvestorPlace’s Lawrence Meyers recently commented that Wyndham’s hotels have occupancy rates of 60-64% compared to 75% for its peers.

By separating the hotel group into its own independent company, you can expect Wyndham to have a laser-like focus in the future on higher standards.

That bodes well for both stocks, post-split.   

Best Retirement Stocks: Snap-on (SNA)

Dividend Yield: 2.3%

Last August, I recommended that investors forget about Snap Inc (NYSE:SNAP) stock and buy Snap-on Incorporated (NYSE:SNA) instead.

Before I get into why I like the hand and power tools, let me just say that both stocks have been on a wild ride since my article.

SNAP, which I recommended you stay away from, was trading around $14.50 on August 22, 2017, the date of the article. It bounced around this price until February when it spiked to almost $21 on news it was adding users. It has since come back to where it was trading last August.

Nothing’s changed. I still don’t like the stock.

As for SNA, it basically did the same, going from $142 in August all the way to $184 in mid-January, only to be felled by a weak fourth-quarter earnings report. Now, it too is back where it was last August.

The biggest concern from analysts is that the company’s non-financed tool purchases are slowing meaning the company’s financial services business is propping up sales, something I recommended investors keep an eye on.

Why do I still recommend it as one of the best retirement stocks to own?

Because every company goes through cycles where business is booming. Now isn’t one of those times but it also isn’t terrible either.

The automotive repair business isn’t sexy, I’ll grant you. But given the average age of cars on the road is still pretty high, the company’s customers (tool buyers) are going to have plenty of cars to fix in the years ahead.

Five years ago, I might have been concerned that its tool business was losing a few sales. However, its three operating businesses provide the company with a much greater balance to see its way through the hiccups every business goes through.

Snap-on hasn’t traded this low very often over the last few years. Buy now and ride them to retirement.

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Source: Investor Place 

10 Stocks to Buy for the Perfect All-Cap Portfolio

best stocks

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When the average investor considers an all-cap ETF or mutual fund, it’s usually filled with large-cap stocks to buy with very little consideration for smaller companies despite the fact that small- and mid-cap stocks often deliver periods of excellent performance when large caps aren’t delivering the goods.

The point of an all-cap portfolio, as I see it, is to own a collection of stocks that represent companies of various sizes both large and small. Personally, in my experience, an all-cap portfolio equally weighted with large-, mid-, small- and micro-cap stocks tend to do better like a sports team than one that’s weighted to larger companies whose growth is generally slower.

However, many investors would be hesitant to include such a heavy weighting in stocks of less than $300 million in market cap so most all-cap ETFs and mutual funds tend to be large caps with a small helping of mid-caps.

These are the 10 stocks to buy for the perfect all-cap portfolio.

Large-Cap Stocks to Buy: Apple (AAPL)

Large-Cap Stocks to Buy: Apple (AAPL)

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In the past, I’ve mentioned Howard Lindzon in articles I’m discussing because I love the way he thinks about investing. One of his recent newsletter posts discussed how Apple Inc.(NASDAQ:AAPL) isn’t one of the sexiest or most exciting stocks he owns but he’s keeping it for now.

As large-cap stocks go, you can get no bigger. It’s the largest publicly traded company in the world. Apple might not be innovating at the pace it once did, but it’s still delivering great products that do what they’re supposed to.

Except, Lindzon also pointed me to a review of Apple’s AirPods that suggests it still knows a thing or two about designing products customers want.

“Apple’s AirPods design, which I initially ridiculed, is actually the best and most functional one available for truly wireless buds today,” wrote Vlad Savov in The Verge March 19. “Because Apple moved the Bluetooth electronics and batteries to the stem, it was able to use the full cavity of each bud for sound reproduction. That’s how the AirPods reproduce a wider soundstage than most Bluetooth earbuds without being any thicker or protruding from the ear.”

It’s something when you can take a big-time audiophile like Savov is reputed to be and turn his opinion 180 degrees from negative to positive.

So, before you give up on AAPL stock, remember that it has plenty of cash to continue developing products consumers enjoy. You can’t put a price on that.

Large-Cap Stocks to Buy: Berkshire Hathaway (BRK)

Large-Cap Stocks to Buy: Berkshire Hathaway (BRK)

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Not quite as big a large cap as Apple, Berkshire Hathaway Inc. (NYSE:BRK.A, NYSE:BRK.B) probably has the best-known CEO of any S&P 500 company.

Who hasn’t heard of Warren Buffett?

Famously honest with his shareholders, I wouldn’t be surprised if ethics professors studied Buffett’s annual letters to shareholders. They’re classic re-tellings of the year that just was — the happenings both good and bad.

I recently highlighted what I thought was the best quote from the 2017 letter.

“In our search for new stand-alone businesses, the key qualities we seek are durable competitive strengths; able and high-grade management; good returns on the net tangible assets required to operate the business; opportunities for internal growth at attractive returns; and, finally, a sensible purchase price,” stated Buffett on page four of the 2017 letter. “That last requirement proved a barrier to virtually all deals we reviewed in 2017, as prices for decent, but far from spectacular, businesses hit an all-time high.”

Buffett’s not perfect.

His stubborn support for Wells Fargo & Co (NYSE:WFC), a bank that faces up to $1 billion in fines from the Consumer Financial Protection Bureau for auto insurance and mortgage lending abuses, is a bit mystifying, but when you have the kind of assets Berkshire Hathaway has, it’s easier to be patient.

Personally, if you only could own two stocks, I’d recommend Apple and Berkshire Hathaway.

Large-Cap Stocks to Buy: JD.Com (JD)

A few months ago, I wrote an article about JD.Com Inc (ADR) (NASDAQ:JDsuggesting that regarding value, JD stock was unquestionably a better buy than Alibaba Group Holding Ltd(NYSE:BABA).

Since that time, both stocks have flatlined.  While I like what Jack Ma’s done at Alibaba, I see what CEO Richard Liu is doing to build a global supply chain and can’t help think that is going to be the difference between success and failure for the company as it expands outside China.

I also see it growing faster than Jeff Bezos’s company did at the same time in its corporate history; I consider the risk to reward to be incredibly attractive.

Sure, it’s the riskiest of the large-cap stocks mentioned here, but also has the most upside.

Large-Cap Stocks to Buy: Royal Caribbean (RCL)

Large-Cap Stocks to Buy: Royal Caribbean (RCL)

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The other day I happened to read an article about Symphony of the Seas, the world’s largest cruise ship that Royal Caribbean Cruises Ltd (NYSE:RCL) just launched. It’s a fascinating story of how cruise ships became the ultimate in modern hospitality and entertainment.

Since my wife and I got married on Majesty of the Seas in February 2005, one of RCL’s smaller, older ships, I’ve been fascinated by the cruising experience although we’ve never been on one since. I love the idea of visiting some ports without having to pack and unpack several times during a vacation. I suppose that’s why people also love motorhomes.

Anyway, CEO Richard Fain’s been the head of the cruise line since 1988, which is a long time to be in charge of any organization these days, but especially so at one built on the necessity of change.

His tenure is amazing.

Interestingly, millennials are said to like cruising more than boomers or Gen Xers, which means Fain might have to stick around for another 30 years to get the company through the changes bound to come down the pike.

I see smooth sailing ahead for RCL stock.

Mid-Cap Stocks to Buy: Gildan (GIL)

Mid-Cap Stocks to Buy: Gildan (GIL)

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If you love investing in dividend stocks, Gildan Activewear Inc. (NYSE:GIL) ought to have your attention, because the Montreal-based maker of t-shirts and underwear does a good job growing its annual dividend payment.

On April 4, I identified as a company increasing its annual dividend payment by double digits. It raised its quarterly dividend Feb. 22 by 20% to $0.112-a-share, the sixth consecutive year to raise its annual dividend by 20%.

Seven years ago, it paid an annual dividend of $0.11-a-share. Today, that’s up to $0.45-a-share. In that time, revenues have increased by a billion dollars to $2.8 billion, while operating income has almost doubled from $239 million to $424 million in 2017.

Down more than 8% year-to-date, you’re getting GIL at prices near its 52-week low.

Mid-Cap Stocks to Buy: Axalta Coatings (AXTA)

Mid-Cap Stocks to Buy: Axalta Coatings (AXTA)

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I was going to recommend Wabco Holdings Inc. (NYSE:WBC) as one of my three mid-cap stocks because I remember Warren Buffett owning it for the longest time. However, he sold off the last of the company’s shares in the second quarter of 2017.

Instead, I noticed Berkshire Hathaway owns a little more than 23 million shares of Axalta Coating Systems Ltd. (NYSE:AXTA), which the company has owned since it bought most of them in a private deal in 2015 for $28 a share. Now finally making money on his investment, it’s possible that Buffett, as the largest shareholder, could buy the entire company to combine with its Benjamin Moore paint business.

Axalta’s fourth-quarter results were an improvement over the previous quarter providing a ray of hope for the manufacturer of performance coatings for commercial applications including vehicles and building facades to prevent corrosion.

“Axalta’s fourth quarter demonstrated a return to solid growth following our more challenged third quarter result, with net sales and Adjusted EBITDA performance both at or above our revised guidance ranges,” said Charles W. Shaver, Axalta’s Chairman and Chief Executive Officer Feb. 6. “Our stated expectation of improved financial performance beginning in the fourth quarter was met and was supported by the broad-based market strength and sound execution by our business teams.”

If Buffett didn’t own Axalta, I’d be less interested, but he does, and so I am.

Mid-Cap Stocks to Buy: Nordstrom (JWN)

Mid-Cap Stocks to Buy: Nordstrom (JWN)

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Investors were disappointed March 20 by news from the special committee advising the Nordstrom, Inc. (NYSE:JWN) board that the Nordstrom family couldn’t pull together a decent deal to acquire the company they founded and still run.

Although it hasn’t been a good time for most department stores in the past three years, Nordstrom’s stock has held up slightly better than its peers over this period, who’ve seen annual losses of close to 13%.

Although the door has closed on the Nordstrom family buying its namesake, the company continues to push on with its future plans. In March, it announced that it had acquired two small tech companies — BevyUp and MessageYes — whose technology allows retail employees to keep in contact with customers when not in the store.

Nordstrom has always been about the customer experience; these two acquisitions will help it maintain its leadership position in this very important part of retailing.

And let’s not forget, Nordstrom generated record revenue of $15.1 billion in fiscal 2017, while also increasing EBIT profits by 15% to almost $1 billion. Department stores might be suffering more than usual but Nordstrom’s not exactly ready for the bargain bin just yet.

Up year-to-date by 2%, I expect the company’s Rack and e-commerce businesses to make up for any softness in the full-line stores.

Small-Cap Stocks to Buy: Callaway Golf (ELY)

Small-Cap Stocks to Buy: Callaway Golf (ELY)

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The Masters just finished up for another year delivering an exciting finish that saw Patrick Reed fend off Ricky Fowler by one stroke and the hard-charging Jordan Spieth by two.

Golf is getting exciting again and not just because Tiger Woods is starting to make some competitive noise. Parents are starting to come to the conclusion that violent sports such as football aren’t healthy for their children’s long-term cognitive skills and are pushing them into sports like golf and swimming.

A quick look at a five-year chart of Callaway Golf Co (NYSE:ELY) shows a gradual improvement that’s taken the stock from less than $7 in 2013 to almost $17 today. Up 21% year-to-date through April 6, a lot of that has to do with its improving financials.

In 2017, Callaway grew operating income by 78% to $79 million on revenue of $1.05 billion, itself a 20% increase over last year.

In December, I suggested that Callaway would produce a four straight year of positive returns. Although it’s early, my prediction is looking pretty good.

In my opinion, ELY is a small-cap stock to own beyond 2018.

Small-Cap Stocks to Buy: Restoration Hardware (RH)

Restoration Hardware Holdings, Inc (NYSE:RH) has got to be one of the most mercurial small-cap stocks trading on a U.S. exchange. It’s up and down by major chunks at a time — most recently, it jumped more than 20% after announcing better than expected Q4 2017 earnings — as investors try to figure out whether its move into higher-end furniture and interior design will generate sustainable earnings.

Well, if the fourth quarter is any indication, it will and it can.

The company announced $1.05 a share in Q4 2017 adjusted earnings, 46 cents higher than analysts were expecting. The retailer is doing better as a result of its move to a club membership where customers pay $100 per year to get 25% off everything sold in the store including interior design services.

In its earnings press release, CEO Gary Friedman stated that 95% of its revenue comes from members. Its move from a promotional business model to that of a club has delivered higher profits and free cash flow from lower inventory.

Not only that, but its first three stores with restaurants in Chicago, Toronto and West Palm Beach are all performing well above expectations generating significant traffic for the stores themselves. The West Palm restaurant is expected to generate $7 million in 2018, a huge number.

As InvestorPlace contributor Vince Martin recently suggested, RH shorts got caught in a short-squeeze of epic proportions. Long-term, I think this model makes a lot of sense. I said as much in 2016; nothing has changed in my opinion.

Micro-Cap Stocks to Buy: Red Lion Hotels (RLH)

Micro-Cap Stocks to Buy: Red Lion Hotels (RLH)

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Once upon a time, I wrote about micro-cap stocks more frequently; I found them to be a great addition to the typical portfolio filled with large-cap and mid-cap stocks. Today, micro-cap stocks (market cap less than $300 million) seem so foreign to me.

Of the 47 micro-cap stocks I found that had a PEG ratio higher than 1 and trading at less than 20 times operating cash flow, Red Lion Hotels Corporation (NYSE:RLH) appears to be the best bet to fill out my all-cap portfolio.

The Colorado hotel franchiser recently purchased the Knights Inn brand of hotels from Wyndham Worldwide Corporation (NYSE:WYN) for $27 million. The deal gives Red Lion 350 additional properties and brings the total number of hotels it operates to almost 1,500 in the U.S. and Canada.

As a result of the purchase, Red Lion becomes one of the top 10 hotel franchisers in the world. Like many hotel companies these days, it runs an asset-light business model.

In 2017, RLH generated $172 million in revenue and operating income of $1.1 million, a significant improvement from 2016. The acquisition of the Knights Inn brand will continue to improve the top- and bottom-line.

Red Lion Hotels flies under the radar of most investors. You might want to check this hotel stock out a little closer.

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 Best Platform Stocks to Buy Now

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What are platform stocks? Which are the best platform stocks to buy and how can they make you rich?

Uber is a platform business. So is Airbnb. At its core, a platform businesses connect consumers of products and services with producers of those products and services through a marketplace created and managed by the platform company.

The general idea is to build something so useful that you create a platform that turns into a quasi-monopoly.

CEO Alex Moazed of Platform consultant Applico defines a platform company as follows:

Successful platforms facilitate exchanges by reducing transaction costs and/or by enabling externalized innovation. With the advent of connected technology, these ecosystems enable platforms to scale in ways that traditional businesses cannot.”

Moazed points out that S&P 500 pure-play platform businesses are valued at an average of 8.9 times revenue, significantly higher than traditional companies at 2-4 times sales.

It’s this reality that makes the Applico Platform Index (API) — a group of 27 platform companies that each have a market cap higher than $2 billion — so successful.

Over the past ten years, the API generated an annualized total return of 15.6%, 510 basis points higher than the tech-heavy NASDAQ, and a testament to the success of platform businesses.

Here are the 7 best platform stocks to buy right now.

7 Platform Stocks to Buy: Ritchie Bros. (RBA)

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Before I get into the more obvious platform stocks, I thought I’d go with a couple of index constituents that most investors wouldn’t name when rattling off platform companies.

Ritchie Bros. Auctioneers Inc (NYSE:RBA) is a Canadian company that got its start in the auction business in 1958 and has grown to annual revenues of $611 million by bringing buyers and sellers together to carry out transactions. In 2017, RBA transacted $4.5 billion in business by connecting these buyers and sellers, online and in person.

In the company’s fourth quarter, it saw revenues increase by 22% to $178.8 million as a result of its May 2017 acquisition for $777 million of IronPlanet, a California company that specializes in the sale of used heavy construction equipment.

On March 27, it launched Marketplace-E, a user-friendly digital platform that will make it easier for businesses to dispose of their assets.

Up 7.4% year to date through April 4, Ritchie Bros. platform solutions should continue to grow the business for years to come.

7 Platform Stocks to Buy: American Express (AXP)

American Express stock

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American Express Company (NYSE:AXP), along with Apple Inc. (NASDAQ:AAPL), were the APIs first two platform companies back in 1984, the date of the index’s inception.

American Express qualifies as a platform company because it operates a closed-loop networkwhere it acts as both card issuer and bank cutting out the middleman.

Additionally, AXP launched Serve in 2011, a platform that enabled its customers to make person-to-person payments using their phone. In 2017, American Express announced that it was selling the U.S. distribution rights and technology of its prepaid reloadable and gift card products — including Serve —  to InComm Holdings.

The platform technology was useful to AXP’s prepaid business. But it turns out the low-end customer didn’t generate enough revenue for it to keep distributing the Serve prepaid cards.

2017 was a transformative year for American Express for two reasons.

First, Ken Chenault retired as CEO of the company in October after 16 years in the job, passing the reins to Stephen Squeri. Secondly, it grew its business at a nice pace over the past year. Highlights include growing the total number of cards in force by 2.9 million and increasing the number of cardmember loans by 12% while adding 1.5 million new merchant locations.

All of that added up to total revenues of $33.5 billion and $7.4 billion in pretax income. Both numbers decent, if not spectacular results. As it continues to work on generating more revenue from each cardholder, I’d expect both the top- and bottom-line to improve in 2018 and beyond.

7 Platform Stocks to Buy: Apple (AAPL)

How Apple Inc. (AAPL) Stock Could Benefit by Being More Like IBM

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Apple is the other original platform stock in the index. It operates a number of different platforms that connect the Apple user to the iOS ecosystem. If you own an iPhone, you know what I’m talking about. Whether it be the App Store, iTunes, Apple Music, iCloud or any of its other services, Apple products are tied into all of these.

I’ve recently considered buying a laptop. Most likely, I’ll buy an Apple product because of the iOS platform. It might be more expensive, but already owning an iPhone and iPad mini, I’m committed to it.

To get me off the Apple platforms the company either has to mess up the ecosystem and products colossally, or the competition delivers something so unbelievably useful I want to switch.

Personally, I don’t think either of those is going to happen. I’m not saying the competition is bad; just that they’re not lights out great. Tim Cook’s job is to deliver new products that are solid, if not spectacular, to feed the platforms, which continue to grow by double digits in terms of revenue.

People like myself will always be okay with just good, and that’s why Apple has the highest market cap in the world. Of all the platform stocks to buy, Apple is the one I’d recommend to buy-and-hold investors.

7 Platform Stocks to Buy: Microsoft (MSFT)

You can’t include Apple in a discussion about platform stocks without also talking about Microsoft Corporation (NASDAQ:MSFT). When it comes to platforms, they’re tied at the hip.

With Microsoft’s cloud and AI initiatives taking center stage at the company, the original Windows platform is looking like a tiny fraction of its overall business. It’s still an essential component through Office 365, but less so than a decade or even five years ago.

Microsoft just announced that it’s spending $5 billion over the next four years on the Internet of Things (IoT) devices. The key to any good platform is the level of connectedness it provides its customers and Microsoft knows it.

In an April 4 blog post, Microsoft Corporate Vice President Julia White  wrote .

“Microsoft’s IoT offerings today include what businesses need to get started, ranging from operating systems for devices, cloud services to control and secure them, advanced analytics to gain insights, and business applications to enable intelligent action. We’ve seen great traction with customers and partners who continue to come up with new ideas and execute them on our platform.”

7 Platform Stocks to Buy: Redfin (RDFN)

Redfin (RDFN)

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In November 2013, I recommended Zillow Group Inc (NASDAQ:ZG), suggesting “if you want to make a lot of money in 3 to 5 years, buying Zillow stock is a smart move.”

Over the past five years, its stock price has doubled, a good, if not spectacular return. Now considered relatively pricey, I thought I’d turn my attention to another real-estate stock on the index — Redfin Corp (NASDAQ:RDFN).

The company’s business model is simple.

It offers real estate agents a technology-enabled, vertically integrated real estate brokerage. It provides buyers and sellers a better experience for less. According to Redfin’s latest March presentation, if you sell a $500,000 home through them and then buy a $500,000 house through them, you’ll save $12,000 assuming the traditional listing-agent and buying agent fees are both 3%.

Houses sell faster through Redfin and for a better price. It’s technology disruption to the max.

“We expect the competitively compelling value prop and simplicity of the ‘1 percent’ product to resonate with consumers this year and potentially accelerate RDFN share gains,” D.A. Davidson analyst Tom White recently told clients in a note.

A good business always makes or saves people money. Redfin does both making it a winner in my books.

7 Platform Stocks to Buy: Amazon (AMZN)

Amazon Stock Is a Raging Bull You Don’t Want to Mess With!

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Despite President Trump’s assertion that, Inc. (NASDAQ:AMZN) is scamming the Post Office out of billions and cheating the Treasury Department out of significant taxes, it’s hard not to appreciate the platform Jeff Bezos has built since its founding in 1994.

People think Jeff Bezos wants to own online retail. And Amazon certainly has a big chunk of the market — the company generated 44% of the U.S. e-commerce sales in 2017. But that’s just a small part of a bigger picture.

Amazon doesn’t want to own online retail; it wants to own your home — figuratively, not literally.

wrote March 2:

“Costco’s business model allows it to survive on razor-thin margins because of its annual membership. Through Prime, Amazon could do the same. Instead of offering just speakers, video streaming, doorbell cameras and all the other things it sells online, why not provide everything a homeowner (and renter) could need to keep the household functioning.

“Amazon could provide insurance, mortgages, wealth management, travel, legal advice, healthcare insurance (it’s on that), actual healthcare, the list goes on.”

Amazon’s biggest platform is Prime. That single membership will take the company much farther than merely focusing on e-commerce. Soon, Prime members are said to be getting a 10% discount when they shop at Whole Foods.

It’s not about online sales. It’s about total sales to the homeowner or renter. That’s exponentially larger.

7 Platform Stocks to Buy: Alibaba (BABA)

What to Expect From BABA Stock Earnings

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 Amazon is all about the home, but Alibaba Group Holding Ltd (NYSE:BABA) goes at this from a slightly different angle. It wants to provide all the platforms and big data necessary for small businesses to compete and thrive — both in its home country of China and around the world.

I neglected to mention AWS in the section about Amazon, the highly profitable piece of its business that helps businesses compete more effectively. I did so, in part, because I believe AWS got its start to provide the infrastructure necessary for AMZN to be a big player in e-commerce retail and moved beyond its walls when it realized it had more capacity at its data centers than it needed in-house.

Suffice to say, Amazon hasn’t forgotten about its business clients, but I digress.

Last May, I called Ma the next Jeff Bezos. Like Bezos, he wants to reinvent retail by owning the consumer, but he knows he can’t do that without successful small businesses.  So, he’s building the same infrastructure that Amazon has such as the cloud, AI, data analytics, whatever it takes to understand what the consumer wants and needs and get it to them.

Eventually, the two companies could be only dominant global players in the business-to-consumer space. Amazon’s well ahead of Alibaba, but Jack Ma’s closing the gap. The next ten years should be exciting.

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 

10 Best Stocks Under $10

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Good things come in small packages goes the saying. Nowhere is that truer than in the markets where stocks under $10 grow to be $100 and possibly even $1,000 over time.

A classic example is, Inc. (NASDAQ:AMZN), which traded under $10 in November 2001, hit $100 in October 2009 and $1,000 in May 2017.

On both occasions, it took approximately eight years to achieve cumulative total returns of 900%. For anyone who’s held AMZN stock for the entire 18-year period, I salute you because a $10,000 investment today is worth $1.5 million.

Who needs to work, right?

However, picking stocks under $10 is easier said than done. In March 2014, I selected five cheap stocks under $10 to buy now.

Here’s how they did.


% Return


Fortress Investment Group


Acquired in December 2017 for $8.08 per share

Acco Brands Corporation (NYSE:ACCO)


Aegon N.V. (ADR) (NYSE:AEG)


Cencosud S.A.


Voluntarily Delisted from NYSE on June 19, 2017



Sought bankruptcy protection in May 2016. Acquired by two mall owners for $243 million in September 2016.

Ok, so my five picks had a few bumps in the road, but that’s going to happen with stocks under $10.

A glutton for punishment, I’m going to do it again. Only this time I’m picking ten stocks, not five. 

Best Stocks Under $10: Arcos Dorados (ARCO)

I might be going to the well once too often picking Arcos Dorados Holding Inc (NYSE:ARCO), the largest franchisee of McDonald’s Corporation (NYSE:MCD) and a major player in the Latin American restaurant industry, but I just love this company.

In January last year, I recommended ARCO as one of three restaurant stocks to buy in 2017; it gained 92% in 2017 on the heels of a 74% gain the year before that.

McDonald’s is facing tougher market conditions at the moment and that’s got analysts a little concerned in the near term, but over the long haul, Arcos Dorados is in an enviable position.

“While we are cautious on MCD in the near term, we believe the chain has ample opportunities to course correct and re-accelerate SSS growth in the coming quarters,” wrote RBC Capital Markets analyst David Palmer in a note to clients.

Best Stocks Under $10: Trivago (TRVG)

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If you didn’t know who Trivago NV (ADR) (NASDAQ:TRVG) was a year ago, you probably do now, given how much advertising the hotel comparison site’s doing to spread the word.

“The past year has been focused on building a solid foundation that we can use to execute our vision of building the best product for our users, and to further strengthen trust in our brand,” stated CEO and founder Rolf Schrömgens in the company’s Q4 2017 press release. “Having significantly increased our brand awareness, optimized our back-end structures and broadened our offering to include alternative accommodation over the course of the year, we believe we are now in the strong position to move forward.”

While Trivago is still growing — revenues grew by 37% in 2017 — it is still losing money. However, on the plus side, it was able to cut the loss by almost 75% in the past year, providing hope to investors that it will deliver GAAP profits in 2018.

I like its chances to break through $10 by the end of the year.

Best Stocks Under $10: Algonquin Power & Utilities (AQN)

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I figure if I’m going to pick the ten best stocks under $10, being Canadian, at least one of my selections ought to be based north of the border.

Algonquin Power & Utilities Corp. (NYSE:AQN) is an Ontario-based diversified power generation, transmission and distribution utility with CAD$10 billion in total assets.

It operates two primary businesses: Liberty Utilities, which provides rate-regulated natural gas, water, and electricity to over 785,000 U.S. customers; and Liberty Power, which generates renewable power from wind, thermal, and solar energy.

Thanks to tax reform, the company feels it will be able to grow its rate base at a faster pace than it otherwise would have been able to do before the December 2017 corporate tax cut.

Acquisitions over the past year have helped the company grow. First, in January 2017, it paid $2.4 billion to acquire Empire District Electric Co., which has 200,000 customers in four states.

Then, this past November, it entered into a joint-venture partnership with Spanish utility Abengoa SA to develop renewable energy projects around the world. As part of the agreement it acquired a 25% interest in Atlantica Yield PLC from Abengoa; Atlantica Yield operates renewable energy facilities in Europe, Africa, and South America.

Going global will pay dividends, literally and figuratively, in the years to come.

Best Stocks Under $10: Sirius XM (SIRI)

A lot’s going right for Sirius XM Holdings Inc. (NASDAQ:SIRI) these days pushing SIRI stock to recent 52-week highs; yet it still only trades between $6-$7.

A big highlight from the satellite radio company’s fiscal year was the addition of 1.56 million self-pay subscribers in 2017, 160,000 higher than its projections, bringing the overall total to 27.5 million.

Another notable highlight was the Trump tax cut which is expected to add $900 million in operating cash over the next four years.

And if that wasn’t enough, Sirius XM’s board approved a $2 billion increase in its share buybacks as well as a 10% hike in the dividend. While you’re not going to buy SIRI for the dividend, the company is trying to increase the rate at which it rewards shareholders.

When you generate as much free cash flow as SIRI does, it’s only natural that share repurchases and dividends are a part of its capital allocation program.

SIRI could be my favorite large-cap stock under $10.

Best Stocks Under $10: ICICI Bank (IBN)

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India is one of my three favorite emerging markets; Brazil and South Africa being the others.

Canadian financier Prem Watsa has done very well in recent years by investing in the country where he was born. Watsa’s considered the Canadian version of Warren Buffett.

In July 2017, Watsa’s company, Fairfax Financial Holdings Ltd (OTCMKTS:FRFHF), terminatedits joint venture with ICICI Bank Ltd (ADR) (NYSE:ABN) after 17 years to carry out the IPO of ICICI Lombard General Insurance Company, itself a joint venture between the two companies.

ICICI Chairman M.K. Sharma finished his 2017 message to shareholders by stating:

“The ICICI Group represents a unique financial services franchise that will benefit from the growth and formalisation of the Indian economy and the Indian financial sector. It will continue its commitment to being a partner in India’s growth and development.”

I believe that India will continue to grow at a faster rate than the emerging markets as a whole. Owning the largest private sector bank in India is a good proxy for benefiting from that growth.

Best Stocks Under $10: Gazit Globe (GZT)

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Talk about your global real estate company.

Based in Tel Aviv, Gazit Globe Ltd (NYSE:GZT) owns properties in Israel, U.S., Canada, Brazil and Europe; its stock trades on three major stock exchanges: New York, Toronto and Tel Aviv. It’s about as internationally diverse as they come.

Its best-known investment here in America would probably be its 11% ownership interest in Regency Centers Corp (NYSE:REG), a REIT with 59 million square feet of retail space with 80% of its 426 centers anchored by grocery stores, a stabilizing factor in a changing retail marketplace.

I’m more of a fan of Gazit Globe because of its 32.6% ownership interest in First Capital Realty Inc (OTCMKTS:FCRGF), one of Canada’s most interesting retail real estate owners.

Not coincidentally, Gazit-Globe director Dori Segal, was CEO of First Capital for 15 years from 2000 to 2015 when he stepped down to devote more time to Gazit-Globe.

Segal’s one of the most respected real estate people anywhere.

Best Stocks Under $10: WisdomTree Investments (WETF)


Focused on ETPs, WisdomTree Investments, Inc. (NASDAQ:WETF) has taken a long and very circuitous route from its founding in the 1980s as a finance magazine to where it is today — an ETP provider with $46 billion in assets under management.

The company’s stock has performed poorly in 2018, down 21% year to date through March 6. As a result, it now trades below $10, a level it hasn’t seen on a consistent basis since 2013.

Why the retreat? The quick answer is it missed its Q4 2017 earnings estimate by three cents. Bigger picture, things look pretty good.

In 2017, if you exclude both the WisdomTree International Hedged Equity Fund (NYSEARCA:HEDJ) and WisdomTree Japan Hedged Equity Fund (NYSEARCA:DHJ) ETFs, it had net inflows of $2.9 billion. In the fourth quarter, also excluding DXJ/HEDJ, it had $1.1 billion in net inflows, its strongest quarter in the last five years.

In November, WisdomTree announced it was acquiring $18 billion worth of European AUM from ETF Securities. The $611 million cash-and-stock deal, which is expected to close by the end of March, will bring the ETP provider’s global AUM to more than $66 billion making it the ninth largest ETP sponsor in the world.

New products and innovations along with future potential acquisitions will help WisdomTree thrive in an increasingly competitive marketplace.

Best Stocks Under $10: BBX Capital (BBX)

Last July, I called BBX Capital Corp (NYSE:BBX) one of the seven best buy-and-hold “holdings” on Wall Street. Since then, it’s up 45% and ready to blow past $10. BBX stock hasn’t had a losing year since 2011.

BBX Capital is probably best known for its vacation ownership business, Bluegreen Vacations, which operates in a very hot industry. Marriott Vacations Worldwide Corp (NYSE:VAC), the industry leader, has delivered an annualized total return of 25% over the past three years as consumers look to own a tiny fraction of the places they choose to vacation.

In November, BBX Capital spun-off its timeshare business into its own publicly traded company, Bluegreen Vacations Corp (NYSE:BXG), selling 10% of the company to investors at $14 a share; it’s now close to $20.

In addition to its vacation ownership business, it also has a private equity division that invests in middle-market consumer-facing companies such as IT’SUGAR, a candy company it acquired in June 2017 for $57 million. It’s also opening as many as 50 MOD Pizza locations in Florida.

Now that Bluegreen Vacations is operating on its own, I’d look for BBX Capital to pick up the M&A pace and burst into the mid-teens.

Best Stocks Under $10: J. Jill (JILL)

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This is a speculative bet all the way, so if you’re thinking about using your retirement fund or your kid’s college fund, don’t. Run away from J. Jill Inc (NYSE:JILL) as fast as you can.

However, if you’re an aggressive investor and can afford to lay down a small bet with the full understanding you could lose the entire sum, by all means, take a closer look at it.

First, a little history.

J. Jill was founded in 1959 as an apparel brand catering to women over 40. Fast forward to 2015; it was acquired by TowerBrook Partners, the same private equity firm behind True Religion Brand Jeans, for $400 million.

Two years later, J. Jill did an IPO in March 2017 at $13 a share allowing TowerBrook to get back a big chunk of the cash it put into acquiring J. Jill back in 2015. Still owning 59% of the company, TowerBrook wants to exit with as much cash as it possibly can.

Retail holiday sales across the industry were good this past year, so I’m hoping the two-day delayof Q4 2017 results isn’t anything more other than the retailer wanting to get the numbers right.

Analysts expect J. Jill to be one of the big retail beneficiaries from the corporate tax rate cut, so that’s a bonus.

Bottom line: At $13, JILL stock was probably a little pricey. At $8 and change, it’s got some upside, especially given the extra profits from lower taxes.

Best Stocks Under $10: Oaktree Specialty Lending (OCSL)

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Business Development Companies (BDCs) aren’t nearly as popular as they once were, but this one caught my attention while writing a piece about the best alternative asset management stocks available.

Oaktree Specialty Lending Corp (NASDAQ:OCSL) is managed by Oaktree Capital Group LLC (NYSE:OAK), the alternative asset management firm co-founded by Howard Marks, one of the best investors of our time.

Oaktree Specialty Lending provides first and second lien loans, unsecured and mezzanine loans, as well as preferred equity to middle-market companies across all industries, preferably ones with strong financials.

It’s been less than a year since Oaktree Capital acquired Fifth Street Finance Corp. It’s going to take the asset manager time to remodel the 122-company portfolio.

At $4 and change, I’m betting Oaktree Capital will turn this around.

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Source: Investors Place