Category Archives: Bear

10 Stocks to Sell in February

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What a run! The S&P 500 is up 5.5% for January, and higher by a hefty 12.7% since hitting a multimonth low in late December. Both are unusually big gains given the limited amount of time stocks have had to dish them out.

The rally, however, has left some stocks vulnerable to a pullback, while the names left out of the marketwide advance have been exposed as perpetually, habitually weak. Both groups are likely to lose ground — or lose more ground — no matter what lies ahead. But should the broad market falter here, these equities could really lose some ground.

With that as the backdrop, here’s a rundown of 10 stocks to sell as soon as possible. They’re either overextended, in unstoppable downtrends or have a history of poor February performances. In no particular order…

Xilinx (XLNX)

Xilinx (XLNX)

Up 62% since the end of 2017, and up 28% this year alone, the momentum that Xilinx(NASDAQ:XLNX) has exhibited is intoxicating. Unfortunately, it probably wasn’t built to last.

XLNX stock jumped 18% last Thursday in response to an incredible third-quarter report. The chipmaker has made the most of the advent of 5G, and said it expects more of the same kind of growth for the foreseeable future. Investors were still buying in on Friday.

As of Monday, though, the sheer weight of the oversized gain and the gap left behind on Thursday are forcing traders to rethink everything about this name and its forward-looking P/E of 28.5. The good news, past and projected, is now priced in, and then some.

Mondelez International (MDLZ)

Mondelez International (MDLZ)

Mondelez International (NASDAQ:MDLZ) hasn’t earned a spot in a list of stocks to sell because it’s overextended … quite the opposite actually. Although it has moved higher with the market since late December, it has suspiciously lagged behind. A look back over the course of the past couple of years, in fact, reveals Mondelez remains more likely to make lower highs and lower lows than not.

Investors just don’t see the company overcoming its core problems anytime soon.

Besides, February is rarely a good month for MDLZ stock. On average it loses a percentage point for the month ahead, and even in a good year, shares fall short of breaking even in February.

United Continental Holdings (UAL)

United Continental Holdings (UAL)

United Continental Holdings (NASDAQ:UAL) is another name that, for seasonal reasons, struggles during the second month of the year. On average, UAL stock loses more than 6% in February, and nothing about its performance so far in 2019 suggests the airline stock will be a screaming exception to the norm.

Admittedly, it’s not an outlook that jibes with the recent headlines. Just a few days ago, United Continental capped off an outstanding 2018 with a fourth-quarter earnings and revenue beat.

The headwind isn’t about reality though. It’s about perception. And right now, between an ongoing tariff war, a government shutdown and rebounding oil prices, the market is at least a little worried about the current quarter’s likely results.

Caterpillar (CAT)

Caterpillar (CAT)

Heavy machinery maker Caterpillar (NYSE:CAT) is in a similar boat. That is, the impact of the trade war with China isn’t exactly taking a massive toll on the company’s bottom line. But, as long as the company is able to say steep tariffs — coming and going — are presenting problems, investors will assume the worst.

And that’s exactly what Caterpillar did with its fourth-quarter report posted on Monday morning. While stopping short of outright blaming it on the war of tariffs and the subsequent economic slowdown in China, the company did concede weakness in China was the cause for the 4% slump in sales for its Asia Pacific arm.

Though CAT stock fell measurably on the report, in the grand scheme of matters, they weren’t terribly shocked. Caterpillar stock is still just trending lower from its early 2018 peak, and there’s little on the radar that might reverse that trend in the coming month.

Exact Sciences (EXAS)

Exact Sciences (EXAS)

Exact Sciences (NASDAQ:EXAS) has been a champ of late, rallying nearly 60% from its late-December low, and up more than 70% over the course of the past twelve months.

EXAS stock, however, is a name with a history of major ebbs and flows. The big move we’ve seen since Dec. 26 has been made two, and arguably three, times since early 2018, and in each case a huge swath of that gain was given back. It’s unlikely this time will pan out differently. It’s just a habit this cancer diagnostics stock has developed.

Conversely, though due for a sizeable setback soon, the pattern Exact Sciences has developed also says it would be a compelling buy after a tumble.

Alphabet (GOOG, GOOGL)

Alphabet (GOOG, GOOGL)

It’s difficult to bet against the company that essentially owns the gateway to the internet. But, add Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL) to your list of stocks to sell before getting too deep into the month of February. On average, GOOGL shares lose a little more than 2% during the second month of the year, and more than half the time it loses ground in February.

It doesn’t appear to be in any major technical trouble right now, but it rarely does in late January.

As was the case with Exact Sciences stock though, any dip from here could be a buying opportunity. GOOGL stock tends to start recovering in March or April to kick off a phenomenal second half of the year.

Illumina (ILMN)

Illumina (ILMN)

Illumina (NASDAQ:ILMN) is another name that’s suspect simply because it has failed to rebound with the rest of the market.

Of course, the doubters had some help coming to their lackluster conclusions. In early January, the company cautioned investors that while its fourth-quarter revenue would be better than expected, 2019’s sales wouldn’t. CEO Francis deSouza was willing to offer 2019 earnings guidance slightly in excess of analysts’ estimates, but for a stock priced at more than 40 times its forward-looking earnings estimates, investors need more assurance the premium they’re paying is justified.

The fiscal outlook might be changed after Tuesday’s post-close report. But, with ILMN stock already below all of its key moving average lines and in a well-framed downtrend, investors are hinting they’re ready to see the glass as half-empty.

Stocks to Sell: Fiserv (FISV)

Fiserv (FISV)

The knee-jerk reaction to the news that Fiserv (NASDAQ:FISV) would be acquiring First Data(NYSE:FDC) was a decidedly bearish one. Shares fell as much as 8.6% on Jan. 18, with many shareholders convinced the company was overpaying for an asset it didn’t exactly need. Things took a dramatic turn beginning that very day though. The intraday loss was cut in half, and as of Tuesday FISV stock was 22% above the low made on Jan. 18. As it turns out, investors love the prospect of the pairing after all.

Still, the big move is overdone. As of Tuesday, would-be profit-takers are testing the waters, and it’s unlikely the stock’s going any higher until investors get a clear idea of what a combined Fiserv and First Data would look like.

Stocks to Sell: AbbVie (ABBV)

AbbVie (ABBV)

There’s nothing inherently wrong with AbbVie (NYSE:ABBV). Though it missed its fourth-quarter revenue and earnings estimates, it’s still a cash cow that’s expected to grow its top and bottom lines this year. It’s dirt cheap too, valued at only 8 times this year’s expected profits.

Nevertheless, like a handful of the other stocks to sell in the coming month, AbbVie is facing an uphill battle of perception. Most drugmaker stocks are losing ground on fears that new drug-pricing legislation could be forthcoming. Meanwhile, ABBV has developed a strong downtrend of its own since peaking a year ago on worries about the fading patent protection of its blockbuster drug Humira.

Keysight Technologies (KEYS)

Keysight Technologies (KEYS)

Finally, Keysight Technologies (NYSE:KEYS) is one of a handful of stocks to sell for February after an incredible January rally that won’t likely last.

Since its late-December low, KEYS stock has gained more than 28%, mostly thanks to the market’s realization of the company’s role in the rollout of 5G wireless connections. Once Verizon Communications (NYSE:VZ) launched an at-home 5G broadband platform in October, the technology became very real for investors. On the hunt for overlooked names in the business, investors found and fell in love with Keysight.

They arguably overshot though. Since it’s now overbought much like it was a couple of different times last year, a reversion to the mean looks likely.

As of this writing, James Brumley did not hold a position in any of the aforementioned securities. You can follow him on Twitter, at @jbrumley.

Source: Investor Place

7 Long-Term Value Stocks to Buy Now

Let’s take a longer-term investing perspective. Which are the stocks you should be buying now for maximum long-term gains? This is the question asked by analysts over at Mizuho Securities.

“We challenged each of our analysts to select the stock that he/she believes would most likely provide long-term value for our clients” says the firm. The result: a highly valuable report revealing each analyst’s top stock pick. These names range from a $65 billion biotech company to a $48 billion industrial company. And with prices generally depressed right now, many of these stocks are trading at bargain levels.

Here we delve into why each analyst is so bullish on their chosen stock. Let’s take a closer look at these top long-term stocks to buy now:

biogen stock

Source: Biogen via YouTube

Biogen (NASDAQ:BIIB) has a dominant position in neuroscience. The company has a leading portfolio of medicines to treat multiple sclerosis (MS). It also offers the only FDA-approved treatment for spinal muscular atrophy (SMA).

To top it off, Biogen also boasts an extensive pipeline of new medicines in development. This includes Aducanumab for Alzheimer’s disease. It is estimated that over 25 million individuals are living with Alzheimer’s worldwide.

The memory loss of Alzheimer’s disease is linked to amyloid plaques, abnormal protein deposits that build up in the brain. Aducanumab is an antibody that binds to and may reduce amyloid plaques from the brain, potentially slowing the disease.

“2019 will likely be a big year for BIIB as investors prepare for Aducanumab’s Phase 3 data in Alzheimer’s, slated to be released at the end of 2019/early 2020. This will likely be an incredibly high profile catalyst, not just for Biogen, but for the therapeutics space in general” writes Mizuho’s Salim Syed (Track Record & Ratings).

If the trial works, it could send BIIB stock up $100-plus (about $33%) from current levels. “Potential moves of this magnitude are rarely seen in Large-Cap Biotech and, in our view, sets up the possibility of FOMO (fear of missing out) trade” he says. According to Syed, Aducanumab’s profile is the most compelling, with a 70% success probability. Interested in Biogen stock? Get a free BIIB Stock Research Report.

Long-Term Stocks To Buy: Facebook (FB)

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Ok so Facebook (NASDAQ:FB) had a pretty challenging 2018. The New York Times published a blockbuster expose recently. They claimed that the social network knew about Russian interference in the U.S. elections, but held back the information for “over a year.” Facebook has denied these claims.

Whether or not this is true, James Lee (Track Record & Ratings) still selects FB as his top long-term value pick. He has a buy rating on the stock with a $220 price target. From current levels, that works out at juicy upside potential of close to 55%. Lee is sticking with his bullish thesis on FB for three main reasons:

  • The transition to FB Stories is on track for success based on increased demand and pricing leverage for Instagram stories;
  • The recent price weakness resulting from the Times articles is overstated. He does not expect advertisers to meaningfully alter their ad budgets on FB (because of the platform’s scale and efficiency); and
  • The valuation is very compelling at 7x 2020 EBITDA. “This is a steep discount to the firm’s estimated growth rate of 20% and below Google’s multiple” writes Lee.

The analyst concludes: “We expect products yet to fully monetize to deliver a 60% upside over our estimated 2020 ARPU, the highest in our coverage universe.” Get the FB Stock Research Report.

Long-Term Stocks To Buy: FirstEnergy (FE)

Source: Erik Drost via Flickr

Arizona based FirstEnergy (NYSE:FE) is an electric services company worth following. In 2018, while the rest of the market faltered, FE put on a 23% sprint.

“We are recommending FirstEnergy as our top large-cap utility pick because of the above-average long-term 6%-8% EPS growth and a dividend policy to match” writes Mizuho’s Paul Fremont (Track Record & Ratings).

At its EEI conference, FE reaffirmed this growth rate and announced a lucrative new dividend policy of 6% increases. This is with a targeted payout ratio of 55-65%. Indeed, the company currently pays out a quarterly dividend of $0.38.

Also worth bearing in mind is a slew of significant regulatory milestones. These include a settlement in Ohio in the Grid Modernization and Tax Reform proceedings as well as an approval from the Bankruptcy Court on FES in September.

“With these regulatory milestones in the past, we believe FirstEnergy can focus on its fully regulated utility strategy with significant growth in its Transmission & Distribution business segments” writes Fremont. The company is currently modelling for strong Transmission & Distribution earnings and Rate Base Growth of 11% and 5% respectively. Get the FE Stock Research Report.

Long-Term Stocks To Buy: GrubHub (GRUB)

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GrubHub (NYSE:GRUB) is a web commerce platform for ordering and delivering take-out food. And with over 50,000 restaurants in 1,100-plus cities, GRUB means food delivery or takeout is just a click away.

“We remain convinced that GrubHub will emerge as the primary winner in online delivery over the next decade” cheers Mizuho Securities analyst Jeremy Scott (Track Record & Ratings). His $145 price target translates into massive upside potential of 90%.

Perhaps what’s most compelling about GrubHub is its unique focus. “As the company’s competitors have zigged into building out new expensive verticals, Grub has zagged into redoubling its efforts to drive a stronger connection with its restaurant partners.” the analyst explains.

Ultimately these investments should solidify its standing as the most effective and least conflicted partner for chained restaurants. “It’s a key, yet we believe underestimated competitive advantage, and it drives our call that GrubHub will be the primary winner of delivery disruption” sums up Scott. Get the GRUB Stock Research Report.

Long-Term Stocks To Buy: Occidental Petroleum (OXY)

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Texas-based Occidental Petroleum (NYSE:OXY) is an international oil and gas exploration and production company with operations across the U.S., the Middle East and Latin America.

With a 4%-plus dividend yield, visibility on free cash flow and capital spending through 2022, and high-quality Permian assets, this is a top stock to track.

“Having reached its cash neutrality target earlier in the year, we think the company will begin growing dividends more aggressively starting next year, and we think this is underappreciated by investors” states Mizuho’s Paul Sankey (Track Record & Ratings).

As dividend growth becomes more meaningful, shares will re-rate towards their historical premium, says Sankey. Right now the company pays out 78 cents per quarter, on a yield of 4.7%. Compare that to the average basic materials dividend yield of 2.64%.

“Our top pick in E&P” adds the analyst. “That’s with an $82 price target, suggesting around 30% upside from current levels. OXY is trading at a ~0.3x turn discount to our US E&P basket, vs. a ~0.5 turn relative premium over the past one and three years.” Get the OXY Stock Research Report.

Long-Term Stocks To Buy: Williams Companies (WMB)

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Williams Companies (NYSE:WMB) boasts 33,000 miles of pipelines — including America’s largest-volume and fastest- growing pipeline — providing natural gas for clean power generation, heating, and industrial use.

According to the company, demand for natural gas is tremendous and continues to grow. This is because gas is cleaner, less expensive and more efficient than other fuels capable of meeting around-the-clock energy demand.

“Strategically, the company is likely to stick to its focus on natural gas infrastructure, and we think its growth outlook will support an attractive double-digit dividend growth CAGR’ says Mizuho’s Gabe Moreen (Track Record & Ratings). That’s with a price target of $32 (36% upside potential).

He sees the possibility of additional asset sales as a positive catalyst for the stock. Selling non-core assets can both free up capital and de-lever the balance sheet. “We think it is likely that WMB elects to sell some of its West segment’s gathering systems, which could fetch attractive valuations” says Moreen. Get the WMB Stock Research Report.

Long-Term Stocks To Buy: FibroGen (FGEN)

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FibroGen (NASDAQ:FGEN) creates first-in-class medicines to treat life-threatening conditions such as anemia, pulmonary fibrosis, and pancreatic cancer.

The stock has the thumbs up from Mizuho’s Difei Yang (Track Record & Ratings). This top-rated analyst singles out FibroGen with a $74 price target (63% upside potential). With shares trading at just $45, she spies meaningful upside on the back of upcoming potential catalysts.

Right now that involves the biotech’s lead product candidate, roxadustat. Yang believes this is likely to be a first-in-class for the treatment of anemia in chronic kidney disease (CKD).

Indeed the company has just announced positive top-line efficacy results. That’s from not one but three global phase III trials of the drug at the end of December. The next step- and potentially sizable catalyst- is the upcoming MACE event. This is the read-out of cardiovascular safety data due in 1H19.

“We believe the MACE data will likely be share moving in 2019 and has potential to differentiate roxadustat from a commercial standpoint vs. competitors” writes Yang. She has an 85% probability of success for roxadustat, and estimates $734 mil peak-sales in 2025. Get the FGEN Stock Research Report. offers exclusive insights for investors by focusing on the moves of experts: Analysts, Insiders, Bloggers, Hedge Fund Managers and more. See what the experts are saying about your stocks now at As of this writing, Harriet Lefton did not hold a position in any of the aforementioned securities.

Source: Investor Place

9 A-Rated Safety Stocks for a Grossly Oversold Market

Yes, the markets are getting hammered like it’s 2008. But this isn’t because the world is coming to an end, or that the global economic system is about to fail.

This is about transition and risk.

The markets are undergoing a significant amount of transition as most central banks are relinquishing control over monetary policy and letting the markets sort it out. Add to that issue the fact that the Brexit mess is affecting one of the major global currencies.

There’s the fact that the U.S. economy continues to show signs of recovery — job growth is very strong, the participation rate is rising and wages are also increasing. Yet rising interest rates, the trade wars with Europe and China make that footing weaker.

For every bit a good news, there’s the shadow of bad news and the markets have never been a fan of uncertainty.

That’s why now is a great time to check out these nine A-rated safety stocks for a grossly oversold market. They’re highly rated in my Portfolio Grader, and with patience as the watchword now, these great stocks are selling at great prices.

Mr Cooper Group (COOP)

Mr Cooper Group (COOP)

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Mr Cooper Group (NASDAQ:COOP) may not be a household name — unless, of course you use it to start your household. It basically acquires companies that are focused on servicing, origination and transaction-based services for single family homes in the U.S. Its two biggest brands are Mr Cooper and Xome. It’s the leading non-bank mortgage servicer in the U.S.

This is one market that has been on both sides of the interest-rate roller coaster. When rates were high, home sales slowed, but when rates started to fall because of fears about the economy, that helped boost home sales and refinancings.

Its recent purchase of IBM’s (NYSE:IBM) Seterus mortgage servicing platform adds $24 billion of mortgages and 300,000 new customers to it rolls. It’s COOP’s second major purchase in 3 months.

Once this bumpy ride smooths, COOP will be well positioned.

Popular (BPOP)

Popular (BPOP)

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Popular (NASDAQ:BPOP) is a holding company that operates financial institutions in the U.S., U.S. Virgin Islands and Puerto Rico. Its parent is Banco Popular de Puerto Rico, which was established in 1893.

Popular opened in the Bronx over 50 years ago and now has U.S. branches in New York, New Jersey and South Florida. Given the amount of Puerto Ricans that call the U.S. home, as well as other Latinos that are drawn by the bank’s roots in the Hispanic culture, BPOP offers a unique opportunity to take advantage of the demographic growth in this sector of the economy with an experienced, successful company.

Up 37% in the past year, and still delivering a 2.1% dividend yield, BPOP is doing very well in all this turmoil.

Medical Properties Trust (MPW)

Medical Properties Trust (MPW)

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Medical Properties Trust (NYSE:MPW) is the only medical real estate investment trust (REIT) that focuses solely on acute care facilities and hospitals where patients must be admitted by doctors.

Its goal is to blend the best of quality healthcare delivery and cost-effective management by maximizing operations management.

MPW started in 2003 and now sports a nearly $6 billion market cap. What’s more, it was up 17% in the past year, and that doesn’t include its generous 6.2% dividend.

It has recently moved into Europe with a big, multi-billion-dollar deal with a healthcare firm in Germany.

Qualys (QLYS)

Safety Stocks: Qualys (QLYS)

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Qualys (NASDAQ:QLYS) has done well in the past year, given the fact that it’s a tech stock.

But most of the credit goes to the fact that it’s a tech stock in the cybersecurity sector, and while that sector may have gotten a bit overpriced, it’s still something that is always in demand.

QLYS focuses on cloud security, which is one of the most in-demand aspects of cybersecurity since the growth in mobility and bandwidth demand have increased substantially. And the introduction of a new generation of data delivery — 5G — will make security even more important.

Also, with a market cap around $2.7 billion, QLYS is a tempting morsel for larger tech firms looking to expand their game in this space without having to build out from scratch.

Axon Enterprise (AAXN)

Axon Enterprise (AAXN)

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Axon Enterprise (NASDAQ:AAXN) is the new name for the TASER company, the folks that brought us the stun gun.

If you recall, a few years back there was an alarming number of fatalities linked to use of TASERs by law enforcement and others. Whether it was due to lack of training or abuse, the stain was largely put on the company.

But the name change as well as the company’s diversification into body-worn cameras for law enforcement has built a new line of products that have helped it diversify and regain its reputation as a reliable, non-lethal protection tool for professionals and citizens.

AAXN is up 71% in the past year and there is every reason to believe that kind of growth is achievable moving forward.


Safety Stocks: DSW (DSW)

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DSW (NYSE:DSW), a big-box discount shoe retailer with more than 500 stores in the U.S., had great Q3 earnings and also raised its guidance for Q4. That happened at the beginning of December.

This is one of those brands that actually became stronger during the recession because that lost decade brought people in who weren’t regular customers previously.

There are two types of regular shoppers — the ones who go in like it’s a treasure hunt, looking for bargains on great shoes and the ones that like the fact that there’s a huge selection to choose from.

During slow economic times, everyone is looking for a deal and DSW is one of the beneficiaries. But now as times improve, it has added to its regular shoppers and instead of returning to premium stores, many shoppers choose to stick with DSW.

It’s why the stock is up 20% in the past year and still delivers a 3% dividend.

Evertec (EVTC)

Evertec (NYSE:EVTC) is the leading payment processing company in Latin America. It operates in 26 Latin American companies, including Mexico and the Caribbean.

Financial technology, or “fintech” is a huge force in the way financial institutions are transitioning from the old style of banking, to the new digital style. And this affects every aspect of the business, especially between the financial institutions and the businesses that they support.

And these digital standards are especially important in emerging markets, where a traditional financial infrastructure can be tough to come by.

EVTC is up over 100% in the past year and is still only trading at a P/E of 29. There is plenty of growth left in the tank.

Brinker International (EAT)

Brinker International (NYSE:EAT) owns the Chili’s Grill and Bar and Maggiano’s Little Italy chains. Most of the restaurants are company owned, although Chili’s does franchise some of its properties.

There has been a shift in tastes among customers and these large restaurant chains have begun appealing to new generations of potential diners. Healthier meals, different pricing structures, etc all have been implemented to keep the new breed of diners happy.

Some have had a tough time transitioning, but EAT has not been one of them. Up 15% in the last year, it also delivers a respectable 3.3% dividend.

Aerojet Rocketdyne Holdings (AJRD)

Aerojet Rocketdyne Holdings (NYSE:AJRD) is a second-tier aerospace and defense contractor. Basically, that means it usually is a subcontractor to the big defense names when it comes to building rockets, propulsion and guidance systems. It also has a long relationship with NASA and other aerospace organizations.

While there is a lot of talk about private aerospace firms entering into the market, the fact is, there is huge potential for the best companies. And given the amount of aerospace work that lies ahead, AJRD will be a major player.

With talk of near-space commercial travel as well as missions to Mars, AJRD will have plenty of work. And the fact that it has been around in various iterations since 1914 shows that it knows how to adapt and thrive.This ‘Overlooked’ Sector Produced the Biggest Winners of the Last Decade
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7 Death Cross Stocks to Ditch Now

U.S. equities are trying to catch their breath on Tuesday after another harrowing decline, with investors suffering the worst December on record since 1931. That’s right: Not since the Great Depression “double dip,” caused by premature Federal Reserve tightening, has the holiday season treated shareholders this badly.

Yet again, it’s the Federal Reserve that’s the primary motivator for the end-of-year ugliness.

All eyes are on Wednesday’s policy decision with another rate hike likely. But more important is the forward guidance for the number of rate hikes in 2019. The market is hoping Fed chairman Powell pauses here and waits to see how the economy and financial market’s digest the rapid rise in the cost of credit. Disappointment could lead the further aggressive selling.

Already, a lot of damage has been done with the Russell 2000 already down 20% from its high, enough to qualify for a bear market. Here are seven stocks that are suffering “death crosses” and look set for further weakness.

Fastenal (FAST)

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Shares of Fastenal (NASDAQ:FAST) are falling below critical support from its 50-day and 200-day moving averages and is on the verge of suffering its first death cross since the summer of 2017 as investors fear a slowdown in construction activity.

Analysts at Morgan Stanley recently initiated coverage with a neutral rating while analysts at Longbow issued a downgrade.

The company will next report results on Jan. 17 before the bell. Analysts are looking for earnings of 60 cents per share on revenues of $1.2 billion.

When the company last reported on Oct. 10, earnings of 69 cents per share beat estimates by two cents on a 13% rise in revenues.

Exxon Mobil (XOM)

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Shares of Exxon Mobil (NYSE:XOM) are falling away from its post-summer trading range to return to lows not seen since April.

A death cross looks likely to happen within the next few days, reversing the oil-induced rally shares enjoyed back in April through June as crude oil prices make another leg lower. Shares were recently downgraded by analysts at Raymond James.

The company will next report results on Feb. 1 before the bell. Analysts are looking for earnings of $1.23 per share on revenues of $83.3 billion.

When the company last reported on Nov. 2 earnings of $1.46 beat estimates by 24 cents per share on a 25.4% rise in revenues.

Qualcomm (QCOM)

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Qualcomm (NASDAQ:QCOM) shares are relegated to a tight trading range below its 50-day and 200-day moving averages, setting the stage for a death cross as the rally into the September highs is reversed.

Shareholders have already suffered a 23% loss. Qualcomm has been in the news for its patent royalty fight with Apple (NASDAQ:AAPL) and has appealed to Chinese authorities to stop the sale of the latest iPhone models.

The company will next report results on Feb. 6 after the close. Analysts are looking for earnings of $1.09 per share on revenues of $4.9 billion. When the company last reported on Nov. 7, earnings of 90 cents per share beat estimates by six cents on a 2.1% decline in revenues.

Amazon (AMZN)

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Everyone’s onetime momentum favorite, Amazon (NASDAQ:AMZN) shares were turned away from resistance near the 50-day and 200-day moving averages and are now threatening to fall below its post-October lows.

Such a move would set up a test of the April low, worth another 13% decline from here. Amazon continues to focus on expanding its physical store footprint, and Amazon plans to roll out smaller versions of its Amazon Go cashier-less stores.

The company will next report results on Jan. 31 after the close. Analysts are looking for earnings of $5.51 per share on revenues of $71.9 billion. When the company last reported on Oct. 25, earnings of $5.75 beat estimates by $2.66 on a 29.3% rise in revenues.

United Technologies (UTX)

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Plans to break United Technologies(NYSE:UTX) up into smaller companies has failed to generate much investor interest, pushing shares down nearly 20% from the highs seen in September and threatening a fall below its early May low. Such a move would set up a move back to the summer 2017 lows near $106 — which would be worth a decline of 9% from here.

The company will next report results on Jan. 23 before the bell. Analysts are looking for earnings of $1.51 per share on revenues of $16.8 billion. When the company last reported on Oct. 23 earnings of $1.93 beat estimates by 11 cents on a 9.6% rise in revenue.

Lowe’s Companies (LOW)

Batted by worries about the housing market and announced store closures, shares of Lowe’s (NYSE:LOW) remain below both their 50-day and 200-day moving averages.

Already down nearly 22% from their late September high, shareholders are on the verge of suffering their first death cross in the stock since the summer of 2017.

The company will next report results on Feb. 27 before the bell. Analysts are looking for earnings of 80 cents per share on revenues of $15.8 billion.

When the company last reported on Nov. 20 earnings of $1.04 beat estimates by six cents on a 3.8% rise in revenues.

Expedia (EXPE)

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Online travel booking icon Expedia (NASDAQ:EXPE) is suffering a rapid reversal of its summertime gains, down more than 14% from the highs seen in late July.

This looks to be part of an epic, multi-year head-and-shoulders reversal pattern that could trace a decline all the way down to the 2013 lows near $45 as competition in the online travel space remains intense and fierce as spending is vulnerable to an economic slowdown and consumer retrenchment.

The company will next report results on Feb. 7 after the close. Analysts are looking for earnings of $1.07 per share on revenues of $2.6 billion.

When the company last reported on Oct. 25, earnings of $3.65 beat estimates by 53 cents on a 10.5% rise in revenues.

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Stocks Are on Thin Ice – Here’s What’s Lurking Underneath

The markets took a break for the funeral of former U.S. President George H. W. Bush, and I’d bet most investors are grateful for the pause in the “Groundhog Day,” Yogi Berra “déjà vu all over again”-type action we’ve been going through since, yes, October.

Yeah, the market just did what it did just last month; the FAANGs rolled over and played dead, only to come roaring back for a seemingly strong push up north and, just when things looked brighter, tanked again.

Rally and swoon, rally and swoon… While there is still a fighting chance for the old bull, it’s looking increasingly grim.

We’re rapidly getting to the point that investors who are unprepared or out of position could be in some serious danger.

That’s why I’m looking so closely at these specific numbers…

There Are Bearish Signs… and Very Bearish Signs

We’ve just notched a lower high. That’s a bearish sign.

If we break down from here, like we did just a couple of weeks ago, and make new lows, that’s a very bearish signal.

The Dow and S&P 500 were both scant millimeters away from doing that at Tuesday’s close – the day after a fairly healthy rally.

If, when the bell rings in a couple of hours this morning, stocks catch the bid and resume an upward crawl, we might be out of the woods. But the futures gains we saw Wednesday morning were essentially peanuts, so I’m not betting that way.

The market looks like nothing so much as a wounded bull in a one-sided bullfight. Has the matador drawn his sword to administer the coup de grace to this old bull?

Maybe. It all depends on the big indexes holding – and building – on the following levels.

Here’s What I’m Watching Closely Right Now

The Dow Jones Industrial Average: If stocks fall to 24,000, we’re going down to 23,500 in a New York minute. If that’s the case, this bull market is probably done.


The S&P 500: The broadest and most significant index was sitting at just above 2,700 at Tuesday’s close. There’s important support at 2,600 – if we break that… get ready to see the S&P test 2,550 in a heartbeat. Below that? Yikes – support is all the way down at 2,400.


The NASDAQ Composite: This tech-heavy group of stocks can be notoriously twitchy when volatile winds blow. There’s support at 7,000, then 6,800, and at 6,500. Below that… we’re looking at the prospect of a bear run that could last a shockingly long time.


The FAANG stocks themselves are worth keeping an eye on, too, because they figure so prominently in the minds of investors, which makes them a major driver of that all-important market psychology.

Facebook Inc. (NASDAQ: FB) has support in the neighborhood of $115 and $120. If shares fall below that, it’s going to be uglier than it’s been… and it’s already been mighty ugly.

Apple Inc. (NASDAQ: AAPL) can lean on support at $160, then $140. If the stock should slip below that, then something’s truly wrong with investors’ hopes and dreams. Inc. (NASDAQ: AMZN) has support at $1,400, $1,375, and $1,200. Any lower, and it’s “Look out below!”

Netflix Inc. (NASDAQ: NFLX) is looking at support levels at $200. Anything lower than that, and it really is anyone’s guess.

Google parent Alphabet Inc. (NASDAQ: GOOG) has support in the region of $1,000 to $980. Its next support is all the way down at $900. If by some weird twist of fate Google gets to those basement levels, the markets themselves should look more like a smoking crater in the ground.

If that’s the case… well, the bright side is, there will be bottom-fishing opportunities like we haven’t seen since 2009.

In the meantime, build up a healthy cash position – 10% to 20% – to stay safe and jump on any potential opportunities. Be very careful about taking any big long positions you can’t escape – yes, “escape” is the word – in a heartbeat, and look for opportune moments to get short with puts or even short-selling shares.

These levels aren’t where we are… yet. They’re where we could get to. Beware – you’ve been warned.

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Source: Money Morning

The Tech Sell-Off? Wake Me When Amazon Hits $200

As some of the tech darlings have fallen rather sharply over the past couple of months, I begin to get the inevitable questions about the wisdom of buying these market darlings.

Everyone just assumes that because I am an investor, I care about these stocks. After all, they’re the ones on the news and in the papers – the stock market equivalent of “must-see TV.” The truth is that I don’t give a rat’s furry behind about the “growth and glamour” stocks.

Why? I could never justify paying the multiples of asset value and cash flow that these stocks fetch at any given moment in time… except in the aftermath of a precipitous decline.

But are they on sale “enough” to suit my tastes or, since you’re here, move me to recommend that you spend your hard-earned ducats on them?

Let’s have a look…

Not Every Sell-Off Is a True Opportunity

But surely, my friends say, as a value investor, I must be excited because these giants have fallen in price.

How far? The slide’s been pretty steep.

During the depths of the sell-off, Facebook Inc. (NASDAQ: FB) sank as low as 40% off the highs. The great and mighty Inc.  (NASDAQ: AMZN) was down over 25%. Netflix Inc. (NASDAQ: NFLX) became a member of the “minus 30%” club. Even Alphabet’s Google Inc. (NASDAQ: GOOG) was down almost 20%.

This is a bloodbath of historic proportions, according to the talking heads and internet geniuses. They must be a buy at these levels!

Let’s walk through some fundamental deep value, “dealmaker” math, shall we?

I buy stocks like the modern-day private equity funds, and other buyers of last resort, buy entire companies. I don’t want to pay more than seven, maybe eight times cash-flow multiples for non-financial companies, and less than the net value of the assets owned by financial companies and REITs.

The only exception to these rules is in my Heatseekers’ Rational liquidation Value Strategy where we only pay a discount to the liquidation value of the firm.

I’m an even bigger cheapskate than that.

I’m only willing to pay for what is – I wouldn’t assign a red cent of value to “forecasted” or “projected” results. The way these folks get creative with accounting? Please! Instead, I have rules, and the controls are a lot like my wife in that they must be obeyed and deviation from what is proven to work is done at great hazard to life, limb, and loot.

Let’s look at what happens when we apply that math to the Titans of Tech.

When Glitzy Tech Meets “Dealmaker Math”

Facebook has generated a cash flow of about $8 a share over the past 12 months. Using my rules, the stock is worth at most $64 a share.  Even after falling almost 40% already, the stock would have to drop another 50% to get my attention.

But I also have to consider the fact that I am only going to fork over my hard-fought money for companies I really, actually want to own. Given the complete and utter clown show we’ve seen from Mark “Deer in Headlights” Zuckerberg, Sheryl “Lean In” Sandberg, and other Facebook C-suite characters in recent weeks, I’m not sure I want to own Facebook.

In fact, I could make that a new rule: When you’re considering buying a company, make sure the leadership has avoided subpoenas and command appearances in front of Congress, the British Parliament, and the European Commission to explain “where we messed up.”

Anyway, that means I am probably only going to be willing to buy the stock if the price is $56 or less.

Now let us turn to Amazon. That’s a trickier issue altogether.

I would love to own Amazon. I use Amazon pretty much every day of my life – you probably do, too. I confess, I’m a wholehearted, joyful Kindle addict. The world’s most beautiful granddaughter has her supply of toys and super-cute clothing replenished by the UPS or FedEx man almost daily, all courtesy of Amazon Prime with free two-day shipping.

I am a huge fan of the newspapers, even occasionally The Washington Post. Furthermore, I’m forever indebted to Jeff Bezos for NOT plunking a headquarters here in my backyard in Florida, what with all the traffic and housing problems that would have caused.

In fact, I like Amazon so much I am going to get really aggressive in defining cash flow to arrive at the highest possible number I can use without vomiting in my lap.

I’m going to overpay, and use a multiple of a sky-high 10 to value that cash flow. I am also going to add the per-share value of their assets to my total valuation (If I had any employees, I would fire one that did that, but I really do like this company, so I want to make the buy-below number as high as possible).

Adding all this up, with a heart full of charity and goodwill and warm, fuzzy stuff, I find… at most I’m willing to pay up to $193 for shares of Amazon.

They are around $1,600 today. This could take a while.

I am not a huge fan of Netflix (I prefer Amazon Prime and Hulu), but my wife and daughters love it.

Doing the deal math with Netflix, I find that I am willing to pay a whopping $25 for the business. A real dig into the balance sheet and income statements tells me that while it is an okay business, it is not a great one. Only bargain multiples can be justified to value the stock.

Now let’s look at Google, or as it prefers to be called, Alphabet. I have a tech friend that calls it the Evil Empire for its data collection and usage practices, and I tend to agree.

However, I didn’t flinch from buying big tobacco or defense companies when they traded at bargain levels, and I won’t hesitate if I get the chance to buy the Darth Vader of Data at the right price, either. Oooh darn, but that price is $380 or less… So I guess I won’t own evil anytime soon, with Google’s price currently over $1,000.

When Value Is on the Line, You Must Be a Hard Case

Usually, when I walk someone through this exercise, they remark that using this type of rigid valuation standard means that I won’t ever own the really great companies that tend to trade at higher valuations.

For the most part, that’s true – and for the most part, I am okay with that. And I certainly wouldn’t hold it against you if we ever met and you mentioned you owned every single one of the FAANGs.

As for me, when I can buy nut farmers, grease collection companies, and other boring businesses that multiply my money many times over in the long term, I’m as happy as an alligator with a fried chicken in its jaws.

Will I miss some exciting moves to the upside when every talking head and their sister mention the FAANGs? Maybe so. But I’ll miss all of the disastrous collapses, too.

In my mind, that’s a damn good trade.

I do not do this to be exciting. I invest to make money, and lots of it – and help a few like-minded individuals also achieve consistent profitability in their investing endeavors.

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3 Tech Stocks to Sell Before It’s Too Late

Source: Shutterstock

Growth stocks were hot … now they’re not. And that places sectors like technology in a precarious position. October was the great unwinding of the beloved FAANG trade and many other tech stocks. How long it lasts is anyone’s guess, but for now, these names are anathema.

Technical deterioration multiplied this week as sellers stuffed last week’s recovery attempts with prejudice. Long-term support levels like the 200-day moving average gave way and distribution days are continuing to add up, creating a toxic brew that is undoubtedly sickening buyers.

I’ve sifted the tech sector for weak tech stocks to sell and discovered three tempting candidates.

Apple (AAPL)

tech stocks to sell: Apple (AAPL)

Source: ThinkorSwim

The latest earnings report from Apple (NASDAQ:AAPL) took the wind out of its sails. Tepid forward guidance was all the reason traders needed to smash the sell button on AAPL stock. Yesterday’s swoon was significant for two reasons. First, it ushered AAPL stock below the 200-day moving average for the first time since April. History teaches that bad things happen below the 200-day. And even though it’s a king among tech stocks, AAPL is not immune to the lessons of history.

Second, AAPL stock’s correction officially became a bear market by reaching the 20% peak-to-trough threshold. While I wouldn’t recommend piling into shorts with the stock so oversold, I do suggest viewing rallies toward $200 with skepticism. Consider bearish option plays on any recovery attempt back toward that level.

Amazon (AMZN)

tech stocks to sell: Amazon (AMZN)

Source: ThinkorSwim

The correction in Amazon (NASDAQ:AMZN) has grown to become the largest in years. At last month’s lows, AMZN stock was down 28%. All major moving averages have been breached in the process. Significantly, we are now below the 200-day for the first time since February 2016.

A series of lower pivot highs and lower pivot lows has formed, confirming bears have wrested control of Amazon’s once-relentless uptrend.

For all its fury, the early November rebound did little in improving AMZN stock’s posture. Chalk it up as a dead-cat bounce. With AMZN working on its sixth down day in a row, it’s challenging to view today as a low-risk entry for new bearish trades.

Nonetheless, if you’re looking for a higher probability trade with a bearish tilt, sell the Dec $1800/$1810 call spread for $1.40.

Netflix (NFLX)

tech stocks to sell: Netflix (NFLX)

Source: ThinkorSwim

Although the trend in Netflix (NASDAQ:NFLX) had already reversed, it was the reaction to its latest quarterly report that acted as the nail in the coffin for NFLX stock. Nothing provides more explicit evidence of souring sentiment than a robust earnings-induced price gap higher that gets sold with prejudice.

The downswing that commenced the minute Netflix opened post-earnings on Oct. 17 sent the high-flier down $110 or just shy of 30% in two weeks. Since then, bears have continued to dominate Netlfix, which was once a Wall Street darling among other tech stocks. With NFLX stock now firmly below all major moving averages, the path of least resistance is lower.

Like AMZN stock, it’s hard to qualify Netflix as a low-risk entry for new bear plays. Either wait for a rebound in NFLX stock or use far out-of-the-money bear calls such as selling the Dec $340/$345 call spread for 55 cents.

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5 Stocks to Sell In November Amid Elections and Earnings

Source: Shutterstock

During October, the stock market created many stocks to sell amid a significant decline. At the peak of the plunge in stock prices, all three major indexes fell into correction territory. Despite the volatility, the month ended with two days of triple-digit gains for the Dow Jones Industrial Average.

Although November will begin on a high note, earnings news coming from many key stocks will likely define the market. The midterm elections on November 6th will also loom over the market. Continued Republican control over both houses of Congress would likely lead to few changes.

However, most political analysts predict a Democratic takeover of the House, with placing the odds at 85.2% as of this writing. Such an occurrence would likely curtail much of President Trump’s agenda and lead to uncertainty as gridlock again takes over Washington.

Whatever happens with earnings or the political makeup of Washington, these equities could become stocks to sell in November:

General Electric Company (GE)

Yet another shoe dropped when GE reported earnings in late October. In the first quarterly report for new CEO Larry Culp, the company cut the quarterly dividend again, this time to one penny per share. The company also missed estimates on earnings and revenue. The firm also announced it would split its power business in two. GE also revealed that the SEC will expand the scope of its investigation on the conglomerate’s accounting practices.It has become difficult to overstate the reputational damage that GE (NYSE:GE) has sustained in recent years. Analysts will likely argue for years whether the poor management of Jeff Immelt or the ability to come clean during the brief tenure of John Flannery caused more damage to GE stock.

Typically, such revelations might inspire a buying opportunity. However, with GE’s recent history, investors have rightly lost trust that more disclosures will not be forthcoming. Coming clean will further hurt GE stock in the short term. Also, even if Mr. Culp turns GE around, I expect more revelations will come soon. I see such a process as necessary to save GE stock in the long term. However, until the company begins to recover its reputation, investors should keep GE on their stocks to sell list.

Lockheed Martin Corporation (LMT)

LMT stock fell by 17% during the swoon in October, signaling that industry observers have begun to price in a Democratic takeover. This places its P/E ratio at just under 17. That valuation looks reasonable. Admittedly, if the Republicans managed to hold the House, investors should remove LMT stock from their stocks to sell list.As the nation’s largest defense contractor, Lockheed Martin (NYSE:LMT) has seen its stock bolstered by an Administration bent on increasing defense spending. So far, that has worked to LMT’s favor. However, the Democrats who appear likely to take over the House have traditionally looked on defense spending less favorably. With the House controlling the government’s purse strings, that will likely place LMT among the stocks to sell.

However, this also came after a forecast 155.2% increase in profits for the year. While analysts predict growth will slow to 11.5% per year, they do forecast average annual profit growth of 51.8% per year over the next five years. If Democrats cut defense spending, that forecast could come down, or even turn into a forecast profit reduction.

Despite these sentiments, the world seems to become more dangerous. For this reason, I still like LMT stock long term. However, with a Democratic takeover of the House likely, uncertainty will probably hamper LMT’s growth for the foreseeable future.

Netflix, Inc. (NFLX)

Netflix (NASDAQ:NFLX) stock has long defied the odds and the naysayers, increasing by almost 40 fold in the last six years. Its leadership in the streaming industry and aggressive move into content have made the company one of the most influential companies in both Silicon Valley and Hollywood. As such, investors drove NFLX stock higher despite valuation metrics.

However, the October selloff may have placed NFLX on many stocks to sell lists for some time to come. The stock has fallen by more than 29% since June. It also declined by almost 20% in October alone. Despite this drop, it trades at a P/E ratio of about 113. Analysts forecast average annual profit growth of 61.8% per year for the next five years. With that, it can easily still maintain a P/E well above the S&P 500 average.

Still, one has to wonder if the heyday of NFLX stock has come to an end. Amazon(NASDAQ:AMZN) has improved its content on its Prime service. Worse, Disney (NYSE:DIS) plans to take its content from Netflix and move it to its own service. Such trends bode poorly for the company.

I expect Netflix to retain its influence in Hollywood and continue to grow at a rapid pace. However, with the challenges it faces on the content front, I do not see NFLX stock maintaining a triple-digit valuation.

Square, Inc. (SQ)

During October, Square (NYSE:SQ) became another high-flying tech stock that saw a massive selloff. Since hitting a high of $101.15 per share in late September, SQ found itself as one of the stocks to sell, and it lost about 27% of its value.

Square succeeded in carving out a niche that the mega-cap tech companies could not supplant. With this niche and a growth rate expected to average 54.8% per year over the next five years, investors have bid up the price of SQ stock. Now, it trades at a P/E ratio of almost 165.

While the stock price has recovered some, one has to wonder if SQ stock can hold the momentum it enjoyed in the recent past. Earnings will come out on November 7th. At that point, investors will find out whether the company can push its stock higher, or if valuations will continue to fall.

Square enabled anyone who owns a smartphone to accept credit card payments. In a society becoming increasingly cashless, this has added tremendous value. With its innovations, I think Square will continue its growth levels for years to come. I also believe it will meet or exceed estimates in its upcoming quarterly report. However, at 165 times earnings, the odds of the report inspiring another sustained move higher do not favor the longs.

Starbucks Corporation (SBUX)

Starbucks (NASDAQ:SBUX) achieve something unusual in October — it went up in value. While indexes flirted with bear market territory, SBUX stock saw a steady increase.

The company will announce its quarterly earnings on November 1st. However, I do not see earnings and revenue numbers as the most critical part of the report. With Starbucks having reached a saturation point in its home country, the focus has turned to China. As of now, the company still open a new store an average of once every 15 hours.

Still, the looming trade war remains a dark cloud over all things China. With no signs of a resolution, most stocks with a large presence in China have sold off. Moreover, companies such as Amazon and Alphabet (NASDAQ:GOOGL, NASDAQ:GOOG) have long found themselves blocked out of a market in favor of a homegrown alternative. If the same thing were to happen to Starbucks, SBUX stock would face severe, long-term damage. China makes up about 3,400 stores of its current store count of over 28,200.

It also accounts for the bulk of the company’s growth. The predicted 14.6% annual profit growth rate over the next five years could disappear in such a scenario. And at a P/E ratio of over 24, the company supports above average multiples. Given its situation in China, I see substantial risk and little reward for buying SBUX stock at these levels.

As of this writing, Will Healy did not hold a position in any of the aforementioned stocks. You can follow Will on Twitter at @HealyWriting.


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3 Stocks to Invest In If the Market Nosedives


Source: Chascar via Flickr (Modified)

After nearly a decade of impressive gains across all three major stock indexes, investors are understandably starting to get a little bit nervous about where the market is headed. After all, share prices can’t continue to rise indefinitely … can they? Many analysts are predicting that the bears will have their reckoning next year, but it’s also important to note that pulling out of the market completely comes with its own set of risks — we’ve been wringing our hands about a major pullback for years now and it’s never actually materialized.

However, that doesn’t mean you shouldn’t take analysts’ warnings to heart.

Now is an excellent time to re-evaluate your holdings and take profits in order to stockpile some cash in the event that a pull-back does eventually come. It’s also a good time to load your portfolio with defensive stocks that will still benefit from the market’s bull run, but are unlikely to tank if the market takes a nosedive.

Here’s a look at three stocks to invest in to prepare for the dreaded bear market.

Value Pick: Coca-Cola (KO)

In a market that’s soaring to fresh highs, the best thing you can do is look for stocks to invest in that have fallen out of favor among investors, making their valuations much more reasonable. Coca-Cola (NYSE:KO) is one such company whose share price has been stuck in the mid-$40’s for years. While the beverage company isn’t delivering the attractive gains that companies like Netflix (NASDAQ:NFLX) and Amazon (NASDAQ:AMZN) are, it’s a good pillar to lean on in times of trouble.

For one, KO stock is a relatively stable consumer products company that looks unlikely to go under anytime soon. The company’s name recognition and massive portfolio of brands makes it a relatively safe bet even in the event of a recession.

Another reason you want to have KO in your portfolio should the market take a turn is the company’s reliable 3.5% dividend yield, which will continue to deliver even when the market is down.

Recession Buster: Duke Energy (DUK)

Recession Buster: Duke Energy (DUK)

Source: Shutterstock

Another way to prepare for a market downturn is to arm yourself with companies that can make money no matter what. The bull run has made utility companies unpopular among investors, but it’s utilities will be popular stocks to invest in if things take a turn for the worst. 

Duke Energy (NYSE:DUK) is one of the nation’s top utility companies and the fact that its operations are largely regulated makes it a relatively safe bet in times of trouble. Even though DUK stock has underperformed the market this year, the company’s earnings reports show a sound financial base that won’t be shaken in a recession.

Plus, it’s a great income stock, delivering a 4.6% dividend yield that will help boost your portfolio in the event of a bear market. 

All Around Good stock to Invest In: Kraft Heinz (KHC)

When picking stocks to invest in for a bear market, there are a lot of avenues to take — stocks that have been beaten down, consumer staples stocks whose products will still be in demand come a recession and, of course, dividend stocks that will bolster their earnings with reliable payments. Kraft Heinz (NYSE:KHC) is one such company that pretty much meets all of that criteria. The firm’s share price is down nearly 25% so far this year, making it a bargain even in today’s inflated market.

KHC is the fifth-largest food and beverage company in the world with a brand portfolio that houses some of the most iconic names in the business. That kind of size is a huge asset in times of recession because people are unlikely to make major changes to their normal grocery buying habits. On top of that, the firm offers a 4.3% dividend yield which will help ease the pain in a tumultuous market.

It’s worth noting that KHC has some debt issues that make it a little riskier than some of its peers, however it looks like the firm has a plan in place to turn things around through a strategic acquisition that will help the company get its finances back under control.

As of this writing, Laura Hoy was long AMZN and NFLX.

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4 Tech Stocks That Are Running Hot (and 4 That Are Cooling Down)

Source: Shutterstock

U.S. equities have surged to new record highs on Wednesday, storming out of the gate led by the mega-cap tech stocks (surprise, surprise). The catalyst is ongoing hopes of a thaw in President Trump’s trade stance, after he penned a deal with Mexico that Canada is expected to join onto.

Stocks are also encouraged by the seasonal tailwinds that have historically been in play heading into mid-term elections. According to UBS, around the 17 mid-terms since 1950, the S&P 500 has returned an average of 6.8% from the end of August vs. 3.4% for other years. Why? Because the market likes the specter of gridlock, which is sort of ironic given the massive gains stocks have posted since Nov. 2016 amid excitement for Trump’s tax cut plan.

But not all stocks are participating equally, even within the hot big-tech area. To illustrate this dynamic, here are four red-hot tech stocks and four that are demonstrating weakness:

Hot Tech Stocks: Apple (AAPL)

Hot Tech Stocks: Apple (AAPL)

Apple (NASDAQ:AAPL) shares are pushing to new record highs above the $220 level, capping a near 40% rise from the late April low as investors prepare for the release of the iPhone product refresh in September. The iPhone X has been successful, despite a slight slowdown in units sold, thanks to its $999 price tag. The full-screen form factor is expected to be expanded into three new models, including an entry-level model with an LCD screen.

The company will next report results on Oct. 30, after the close. Analysts are looking for earnings of $2.75-per-share on revenues of $60.9 billion. When the company last reported on July 31, earnings of $2.34 beat estimates by 16 cents on a 17.3% rise in revenues.

Hot Tech Stocks: Amazon (AMZN)

Hot Tech Stocks: Amazon (AMZN)

Amazon (NASDAQ:AMZN) shares are going vertical now, flirting with the $2,000-a-share level to mark a doubling from the lows seen around this time last year. The catalyst for the rise was a private target increase by analysts at Morgan Stanley, who are looking for $2,500 (a Street high) in anticipation of higher profitability and upward earning estimate revisions.

The company will next report results on Oct. 25, after the close. Analysts are looking for earnings of $3.21-per-share on revenues of $56.9 billion. When the company last reported on July 26, earnings of $5.07-per-share beat estimates by $2.54 on a 39.3% rise in revenues.

Hot Tech Stocks: Microsoft (MSFT)

Hot Tech Stocks: Microsoft (MSFT)

Microsoft (NASDAQ:MSFT) shares are breaking up and out of a two-month consolidation range to push to new highs, continuing a steady uptrend that has been in play since the summer of 2016. Earnings growth has been good, driven by the company’s success in cloud-based software as a service offerings.

The company will next report results on Oct. 18, after the close. Analysts are looking for earnings of 96-cents-per-share on revenues of $27.7 billion. When the company last reported on July 19, earnings of $1.14-per-share beat estimates by 6 cents on a 17.5% rise in revenues.

Hot Tech Stocks: Alphabet (GOOGL)

Hot Tech Stocks: Alphabet (GOOGL)

Alphabet (NASDAQ:GOOG, NASDAQ:GOOGL) shares are up 1.3% in mid-day trading on Wednesday, pushing back toward highs not seen since late July after analysts at Morgan Stanley raised their price target to $1,515 from $1,325. This follows a price-target upgrade from analysts at MKM Partners on Aug. 22, which increased to $1,465 from $1,355.

The company will next report results on Oct. 25, after the close. Analysts are looking for earnings of $10.69-per-share on revenues of $34 billion. When the company last reported on July 23, earnings of $11.75-per-share beat estimates by $2.05 on a 25.6% rise in revenues.

Hot Tech Stocks: Twitter (TWTR)

Hot Tech Stocks: Twitter (TWTR)

Twitter (NYSE:TWTR) shares are barely lifting off of the mat, struggling to stay above their 200-day moving average after a nasty fall from the highs set in the middle of June. The company has been at the center of a growing political backlash against accusations of “shadow banning” and outright censorship of some conservative contributors — something that has attracted the ire of President Trump. CEO Jack Dorsey will testify on the subject in front of the House of Representatives on Sept. 5.

The company will next report results on Oct. 26, before the bell. Analysts are looking for earnings of 5-cents-per-share on revenues of $703.7 million. When the company last reported on July 27, earnings of 17-cents-per-share beat estimates by a penny on a 23.8% rise in revenues.

Hot Tech Stocks: Snap (SNAP)

Hot Tech Stocks: Snap (SNAP)

Snap (NYSE:SNAP) shares are drifting lower, testing the lows seen back in May for a loss of more than 21% from the highs set in June. The company continues to struggle to regain traction lost from a widely panned app redesign and loss of hype surrounding its Spectacles glasses camera. Earlier in August, the company reported a decline in daily active users.

The company will next report results on Nov. 6, after the close. Analysts are looking for a loss of 27-cents-per-share on revenues of $282.7 million. When the company last reported on Aug. 7, a loss of 14-cents-per-share beat estimates by 3 cents on a 44.4% rise in revenues.

Hot Tech Stocks: Facebook (FB)

Hot Tech Stocks: Facebook (FB)

Facebook (NASDAQ:FB) shares continue to languish below their 200-day and 50-day moving averages as the company continues to suffer from tepid user growth metrics, political pressure and investor confusion surrounding its pivot to focus on privacy over profits. A breakdown here would imperil the long uptrend the stock has enjoyed going back to the summer of 2013.

The company will next report results on Oct. 24, after the close. Analysts are looking for earnings of $1.48-per-share on revenues of $14.3 billion. When the company last reported on July 25, earnings of $1.74-per-share beat estimates by 4 cents on a 41.9% rise in revenues.

Hot Tech Stocks: Netflix (NFLX)

Hot Tech Stocks: Netflix (NFLX)

Netflix (NASDAQ:NFLX) shares are fighting hard to cross back over their 50-day moving average, an attempt to reverse the 20%+ decline from the June/July double-top high. But growing doubts about the company’s user growth metrics, fast-rising cost of content and increasing competitive pressures from the likes of Disney (NYSE:DIS) suggest downside pressure should resume soon.

The company will next report results on Oct. 15, after the close. Analysts are looking for earnings of 68-cents-per-share on revenues of $4 billion. When the company last reported on July 16, earnings of 85-cents-per-share beat estimates by 6 cents on a 40.3% rise in revenues.

Anthony Mirhaydari is the founder of the Edge (ETFs) and Edge Pro (Options) investment advisory newsletters. Free two- and four-week trial offers have been extended to InvestorPlace readers.

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