Category Archives: Growth Stocks

These 3 Companies Are Closer than Ever to Providing a Cure for Cancer

The world of medicine is quickly moving from the pages of a science fiction novel to reality. Imagine a time when a person’s cells are “re-engineered” to recognize and attack cancer, so that conventional therapies are not needed.

Well, that time is upon us. Immunotherapy – therapies that use and strengthen the power of a patient’s immune system to attack cancers – has emerged in what many are calling the “fourth pillar” of cancer treatment joining surgery, radiation therapy and chemotherapy.

The immunotherapy that is closest to actually helping cancer patients is called Car T-cell therapy. After literally decades of painstaking research, the field has reached a tipping point, with several companies producing very promising results recently.

If you are unfamiliar with the term CAR-T, it stands for chimeric antigen receptor cell therapy. But before I reveal to you those companies that have had outstanding trial results, let me fill you in on what exactly CAR-T therapy is, which some doctors describe as a “living drug”.

What is CAR-T?

Here in general is how the Car-T process works:

Millions of a patient’s white blood cells are extracted through a process called apheresis. These cells are then sent on to a lab where scientists isolate T-cells from the white blood cells. T-cells are often called the ‘workhorses’ of the immune system because of their crucial role in orchestrating a response from our immune systems, killing cells infected by pathogens.

The next step, using a ‘disarmed’ virus, involves genetically modifying these T-cells to produce chimeric antigen receptors on their surface. This process once took a six-week period, but the times for cell modification have now been greatly reduced.

These chimeric antigen receptors allow the T-cells to recognize and attach to a specific protein, or antigen, found on cancer cells. Additionally, scientists believe modified T-cells have the ability to reactivate other immune system elements that have been suppressed by the cancer. They ‘talk’ to other cells of the immune system using chemicals known as cytokines.

Once these modified T-cells have been produced in the laboratory, they are ‘expanded’ by scientists to number in the hundreds of millions.

After receiving the chimeric antigen receptor CAR T-cells back from the lab, doctors infuse them back into the patient’s body. But not before one final round of chemotherapy, called lymphodepleting, which eradicates out the existing T-cells. This allows the re-engineered cells more room to multiply themselves and (hopefully) attack the cancer.

Now let me tell you about some of the companies that have had recent successful trials for Car-T therapies that were reported at the focus of the biotech world this week – the annual meeting of the American Society of Hematology in Atlanta.

Related: 3 Stocks for Double Digit Gains from Personalized Medicine

Car-T Therapy Company #1 – Gilead Sciences

The first company I want to tell you about is Gilead Sciences (Nasdaq: GILD), which revealed results of a trial that took place at the University of Texas on December 10. The trial was conducted by what is now a subsidiary of Gilead – Kite Pharma – that was acquired in August for $11.9 billion.

Gilead’s product, Yescarta, was given an okay by the FDA in October. The trial results showed that after a median period of 15.4 months, 59% of patients with non-Hodgkin lymphoma were still alive, while 42% were in remission and 40% exhibited absolutely no trace of cancer. That is quite a contrast to existing therapies, where the median survival time for people at stage of this disease is only six months!

This is a key point because most of the doubters of Car-T therapies expressed reservations about the longevity of the effects of the treatment. But apparently, the modified T-cells do remain in a patient’s system, guarding against recurrence of the cancer.

Gilead sees the long-term promise of these types of therapies and bought a second Car-T company, Cell Design Labs, recently for $567 million. Going big into Car-T therapies should, over the long term, boost the company’s stock which is up only 6% year-to-date.

Car-T Therapy Company #2 – Bluebird Bio

The second company, which revealed spectacular trial results at the Atlanta conference, is Bluebird Bio (Nasdaq: BLUE). The stock soared about 30% on December 11 and is now up about 225% year-to-date!

A novel therapy from Bluebird Bio and Celgene (Nasdaq: CELG) was given to 18 multiple myeloma patients that were nearing death (four months expected left to live) from a very aggressive form of the cancer. A single infusion of bb2121 at the highest dose generated an 86% overall response rate and all but one of the patients saw a clinical benefit. After nine months, 56% of the patients were in remission – an improvement from May when only 27% of the patients were in remission (again those beneficial long-term effects).

The results are important because, despite advances in drug therapy improving survival from three years to 8-10 years, multiple myeloma is still largely incurable.

This apparently successful Bluebird therapy targeted the BCMA protein that is found on myeloma and plasma cells. Targeting that particular protein is a path also taken by other companies involved with Car-T therapies – Novartis AG (NYSE: NVS) and GlaxoSmithKline PLC (NYSE: GSK).

Car-T Therapy Company #3 – Novartis

That brings me to the third Car-T company with promising results presented in Atlanta, Novartis, and its Kymriah therapy, which was given the go-ahead by the FDA in August. The stock of this pharma giant is up over 15% year-to-date.

New analysis of trial data for Kymriah presented at the conference showed that the drug sustained complete responses in adults with a difficult to treat form of blood cancer – diffuse large B-cell lymphoma (DLBCL).

The overall response rate among patients was 53%, with 40% achieving a complete response and 14% a partial response. At six months, 30% of patients were in complete response, with a 74% rate relapse-free rate after the onset of response. Again, very promising longer-term results.

The Good and the Bad

Will these life-saving therapies become commonplace, benefiting these companies and, most importantly, the patients?

There are two obstacles as I see it. The first one includes the side effects from these therapies.

In the attempt to kill cancer cells, the treatment effectively sends the immune system into overdrive. That jacked-up immune response can often cause something called cytokine-release syndrome. The cells that the engineered T-cells target release a group of proteins known as cytokines, triggering a massive inflammatory response. This can be too much for the body to handle, and can cause life-threatening side effects like severely high fevers, dangerously low blood pressure or even a temporary inflammation in the brain.

Luckily, both the drug companies and the doctors are making improvements along this line… the actual side effects are less severe than in the original trials and the doctors are getting better at managing the side effects in patients.

The bigger obstacle may be the cost, thanks to the still very complicated process to engineer a patient’s T-cells. The cost is possibly the highest ever seen in the drug industry. For example, Gilead charges $373,000 for Yescarta, while Novartis put a price tag of $475,000 on Kymriah, although it says it will offer refunds if the treatment does not work.

Prices though should drop as Car-T therapies become more common. That makes a company like Bluebird Bio worth a look by you on any pullback as a long-term investment.

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Bigger Than Apple

With the end of 2017 approaching, I want to take a moment to look back at the past year. Think back to the beginning of 2017 for a moment. Fresh off the November election, I think we all expected the stock market to rally.

But did you expect the Dow Jones Industrial Average to be up more than 24%?

If you did anticipate a large gain for the Dow, what component did you have pegged as the top gainer? For many readers and investors, it was likely Apple Inc. (Nasdaq: AAPL). As you can tell from the title of this article, that’s not the case.

Since tech has been hot in 2017, and was on fire heading into the year, you might have guessed Microsoft Corp. (Nasdaq: MSFT) was the top Dow performer. Or maybe with President Donald Trump’s promised rollbacks of financial banking regulations, you had JPMorgan Chase & Co. (NYSE: JPM).

None of those things came to pass, however. Apple has only gained about 49% so far this year, while Microsoft is up 37%. JPMorgan has added a mere 22% despite all the bluster back in January over reversing Obama-era banking restrictions.

No … 2017 was the year for manufacturing and capital equipment. The No. 2 biggest gainer on the Dow in 2017 was Caterpillar Inc. (NYSE: CAT), with a year-to-date return of 58%.

You may remember that I first recommended CAT stock back on June 7, and then reiterated my bullish stance on September 20. CAT stock is up 43% since June, and is still powering higher on strong global demand for construction and mining equipment.

While a 58% return is nice, the biggest gainer on the Dow is currently up more than 88% since the start of the year. This company’s shares have also come in as the 12th-biggest percentage gainers among all U.S. NYSE stocks. What’s more, those gains could extend well into 2018…

Flying the Skies with Boeing Stock

The list of investors who picked Boeing Co. (NYSE: BA) to be 2017’s biggest gainer on the Dow has to be pretty short, especially compared to the list expecting Apple to rise to the top once again. But in 2017, the Boeing stock price was a bigger gainer than Apple.

While Apple was plagued with analysts’ delivery concerns (that were only partially true) regarding its new iPhone, Boeing was raking up multibillion-dollar deals to replace aging fleets across the globe.  Boeing’s “iPhone” launch was its unveiling of the new 737 MAX 10 at the Paris Air Show back in June.

The unveiling provided considerable momentum for Boeing, and by the beginning of December, the company had net firm orders for more than 660 aircraft on the year. By comparison, Boeing brought in just 668 orders in all of 2016, and leading competitor Airbus had only booked 333 net firm orders by the end of November.

Furthermore, December is typically a huge month for aircraft orders, with Boeing finalizing more than 200 orders in the last week of 2016. In short, Boeing is not only trouncing fellow Dow component Apple, it’s also blowing past direct competition from Airbus.

As a direct result of 2017’s strong performance, Boeing recently boosted its quarterly dividend to $1.71 per share — a year-over-year increase of 20%. The company is also returning additional cash to shareholders next year by approving an $18 billion stock buyback program.

And these solid fundamentals are all without the Republican tax plan in place. With many analysts expecting some form of tax plan from Congress, Boeing is sure to benefit.

Investing in Boeing Stock

The problem with Boeing stock is that the shares are a victim of their own success. BA has ridden support at its 20- and 50-day moving averages to fresh all-time highs near $295. While this normally wouldn’t be a bad thing, especially for current BA stockholders, it has placed the shares in overbought territory.

BA’s current Relative Strength Index comes in at 75, with readings above 70 typically considered overbought. What this translates into is a short- to intermediate-term pullback for BA stock, possibly to the $275 to $280 region, which is home to support in the form of BA’s 20-day moving average. A pullback to this area would definitely make BA a buy.


The list of investors who picked the Boeing stock price to be 2017’s biggest gainer on the Dow has to be pretty short. But they were right...


Finally, Boeing will release its fourth-quarter earnings results on January 21. Boeing is expected to report a profit of $2.87 per share, up from $2.47 per share in the same quarter last year. Revenue is expected to rise 3.8% to $24.17 billion.

Boeing has had a habit of besting Wall Street’s targets this year, so another stronger-than-expected report could help BA stock blow past overhead resistance at $300.

Just remember to wait for a pullback for a better entry price before taking the plunge.

Until next time, good trading!

Joseph Hargett

Assistant Managing Editor, Banyan Hill

In this exciting NEW VIDEO, Wall Street legend and former multibillion hedge fund manager Paul Mampilly pulls back the curtain on the biggest investment opportunity in the market today. What insiders are calling “The Greatest Innovation in History,” this revolution will mint more millionaires and billions than any technology that came before it. Right now, the current market for this technology is just $235 billion, but given how fast this technology is moving experts predict it will soar to $19 trillion by 2020. But 8,000% growth is just the beginning—and now’s your chance to get in on the action. [CONTINUE TO VIDEO]

Source: Banyan Hill

Gun Manufacturers Love Democrats

Gun stocks like Smith & Wesson and Sturm Ruger & Co. saw huge gains as they turned unexpectedly high profits quarter after quarter with a Democrat in power.

As we all know, gun control has been a hot topic in politics, particularly during the last two to three years. And the fear of restrictions on guns has been very profitable for gun manufacturers – and great for gun stocks.

For a lot of gun buyers, it was a means of stashing something so nobody could prevent them from buying it. As a result, gun stocks like Smith & Wesson (now American Outdoor Brands Corp. [Nasdaq: AOBC]) and Sturm Ruger & Co. Inc. (NYSE: RGR) saw huge gains as they turned unexpectedly high profits quarter after quarter.

But now, with a Republican in office, those worries of having guns taken away seem to be fading. Not completely, as there are still relatively high numbers of background checks coming though, but the number has fallen short each month of the peak that it reached in 2016.

As a result, gun stocks that led the market last year have, for the most part, collapsed.

Gun stocks like Smith & Wesson and Sturm Ruger & Co. saw huge gains as they turned unexpectedly high profits quarter after quarter with a Democrat in power.

All of the stocks in the chart above move with the gun sales market. With the numbers on the right side representing the percent return for the past year, you can see that the returns have been awful, especially when you compare them to the S&P 500, which is up 18%over that same time period.

In short, the recent trend is that gun sales, and therefore the prices of gun stocks, tend to increase when a Democrat is in office. This was pronounced with Presidents Bill Clinton and Barack Obama. And now, there are investments you can make that are based on typical policies for each political party.

That’s right, political investments!

As of October, EventShares has come out with exchange-traded funds (ETFs) for “Republican” and “Democrat” stocks based on policies typically carried out by either party. The ticker symbols are GOP for Republican policies and DEMS for Democrat policies.

These are easy ways to invest in the policies carried out by each party. For example, GOP holds a lot of stocks that benefit from tax reform, deregulation and national defense investment. DEMS focuses more on health care expansion and stocks that benefit from environmental efforts.


Ian Dyer

October new home sales ended up beating the forecast by about 10%. And these two companies will benefit from the growing housing market.

Internal Analyst, Banyan Hill Publishing

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Source: Banyan Hill

Make a 50% Gain on This Trendy IPO

I learned a hard lesson about collecting a few weeks ago.

It’s a lesson that spawned from my childhood. Like all boys growing up, I was fascinated with baseball. Initially, I followed my hometown heroes, the Cincinnati Reds, but as I fell more in love with the sport, more teams were added to the list. By the end, my all-time favorite team was the Oakland Athletics.

As a way to follow the players I liked best, a few of my relatives introduced me to baseball cards. Not only could I collect cards of my favorite players, but I could also make money on those cards when I got older. Baseball cards tend to go up in value, my relatives told me. Hold on to them until you get older, and you’ll be set.

It was a dream come true to find out that a hobby I loved could eventually pay off big down the road. I would go on to collect binders filled with cards picturing Reds outfielders Eric Davis and Ken Griffey Jr., as well as my favorite A’s players, Mark McGwire, Jose Canseco and Rickey Henderson…

Those of you familiar with baseball and card collecting already know where this is going. Not only was the McGwire/Canseco era plagued with doping scandals, which ultimately undermined card value, it was also a period during which companies like Topps, Donruss, Fleer and Upper Deck printed massive amounts of cards.

While I was aware of the baseball doping scandals, I hadn’t a clue about the massive card printing issue until a few weeks ago. Having abandoned card collecting in the late 1990s — I literally stuck the things in a shoebox at the back of my closet — I naively took my cards to a local shop to finally cash in on a few of those cards.

 The shop owner wouldn’t even look at them. “They just left the card printing presses running in the ‘90s,” he told me. “Nothing I can do. Maybe in another 10 years when everyone has thrown them away?”

The lesson here is that collectibles are a fickle market, especially when mass production and pop culture are involved. But one rapidly growing company is ignoring that lesson. Funko Inc. (Nasdaq: FNKO) believes it can turn both pop culture and mass production into a profitable business model for collectibles.

The Fun in Funko

If you’re not familiar with Funko, the company makes collectable toys, including a popular line of Pop! plastic figurines. These collectibles feature pop culture icons … like characters from Star WarsThe Walking Dead and Marvel, among many, many others.

The key business strategy for Funko is to identify a pop culture trend, license the character rights, and start producing figurines and collectibles before the trend dies. So far, the company has been relatively successful.

In the third quarter last year, Funko raked in roughly $112 million in sales. Growth was solid enough that Funko decided to go public to raise additional funds and pay down debt. FNKO stock had its initial public offering (IPO) at $12 per share amid a respectable amount of fanfare. However, FNKO would ultimately plunge 41% on its first day of trading on the New York Stock Exchange.

Lackluster IPOs are not a new thing for 2017. In fact, there were only a handful of real successes. But Funko is far from a failed IPO just yet.

On Tuesday this week, Funko released its first quarterly earnings report as a publicly traded company. While net income fell to $8.3 million from $17.2 million last year due to rising expenses related to debt and the company’s $4 million acquisition of a U.K. animation studio, sales jumped 21% year over year to $142.8 million.

But those financial hurdles should diminish going forward. Funko plans to use its IPO cash to pay down debt and finalize the acquisition of the animation studio, which it has rebranded as Funko Animation Studios.

Furthermore, Funko’s third-quarter performance has attracted analysts’ attention. Bank of America Merrill Lynch just issued a “buy” rating and a $12 price target for FNKO stock, noting that sales came in above forecasts and that the Toys R Us bankruptcy has cast an unwarranted negative shadow over Funko.

Investing in Funko

Having learned my lessons on pop culture collectibles the hard way — I’m looking at you, Ken Griffey Jr. — I’m leery of investing in Funko right now. The shares have shown considerable volatility, surging more than 20% following their third-quarter earnings report, only to come plunging back to earth shortly thereafter.

Still, the shares are showing some price support near their emerging 20-day moving average. This is especially encouraging given that FNKO only IPO’d on November 1.

Funko Inc. believes it can turn both pop culture and mass production into a profitable business model for collectibles. Here's why you should invest.

The problem is that volatility is going to stick with FNKO stock until the company can provide a solid history of meeting or beating Wall Street’s fundamental expectations. That’s going to take time. It is also going to mean continuing to capitalize on emerging pop culture trends in a timely fashion.

If you’ve got the stomach for a bit of risk, FNKO stock may never trade this low again if it can continue to show double-digit year-over-year growth. Personally, however, I would like to see the shares sustain support above their 10- and 20-day moving averages before finally investing — and right now that means a sustained trend above support near $9 per share.

Until next time, good trading!

Joseph Hargett

Assistant Managing Editor, Banyan Hill

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Source: Banyan Hill 

Buy These 3 Stocks to Ride the Bitcoin Boom

For the longest time, Wall Street ignored the wild ‘party’ going on in the realm of cryptocurrencies and more specifically Bitcoin. But no longer… Wall Street is joining in on the party and supplying some of the ‘booze’.

That ‘booze’ is coming in the form of Bitcoin derivatives. On December 1, the Commodity Futures Trading Commission gave the green light to plans from the Chicago Board Options Exchange – owned by CBOE Global Markets (Nasdaq: CBOE) – and the CME Group (Nasdaq: CME) to begin trading Bitcoin futures. The CME announced trading will begin on December 18.

Related: 5 Stocks Riding the Semiconductor Supercycle

This is huge shift in attitude from Wall Street, where many of its leading executives had called Bitcoin nothing more than a ‘fraud’. This seeming endorsement now by Wall Street may be the beginning of a whole new asset class to invest into. The reason for this change in attitude is obvious – Wall Street can ‘smell’ the money. Despite some very sharp reversals, Bitcoin has been on a very fast elevator ride upward, from little more than $300 at the start of 2015 to over $11,000 last week and continuing to rise.

Despite all the headlines and the fact that Coinbase, the largest U.S. cryptocurrency exchange, now has more accounts than Charles Schwab, I suspect that many of them people chasing after Bitcoin don’t even know exactly what it is. If you fall into that category, here is a quick primer on cryptocurrencies and Bitcoin as well as three stocks to put in your portfolio to profit from the Bitcoin revolution.

What in the World Is Bitcoin?

Sometimes called coins, a cryptocurrency is a creation of the 21st century and is a mixture of digital assets, large computing power and a network of servers that store shared data. Besides Bitcoin, there are numerous other cryptocurrencies including Ethereum, Litecoin, Dash and Ripple. Ethereum, for example, is often used as the ‘money supply’ for initial coin offerings, or ICOs.

For simplicity’s sake, let me concentrate solely on Bitcoin. In basic terms, it is a cryptographically scarce and secure medium of exchange. In effect, it is a string of computer code. Each and every transaction is recorded in a database called a blockchain. This technology is accepted by even the Bitcoin naysayers as important.

I say scarce because there is only a finite number of Bitcoins – 21 million – that can be created through a process called mining (solving complex mathematical problems using powerful computers). In an interesting side note, the intensity of mining this year has used more electricity than the annual consumption by 159 nations, according to Digiconomist. Data from Chainalysis reveals that there are currently only 16.7 million Bitcoins in circulation. Of those Bitcoins in circulation, about 37% have been spent or traded in the past year, another roughly 22% is being held by strategic investors, and the rest can be classified as ‘lost’.

If you look at the valuation of Bitcoin, it is now approximately $170 billion, which is equivalent to the market capitalization of General Electric (NYSE: GE). Because of meteoric rise, there are myths that have grown around Bitcoin, which I will now address.

Bitcoin Myths

Probably the number one myth is that Bitcoin can be hacked. That is false – Bitcoin has not been hacked. But Bitcoin exchanges have been hacked. That means it’s up to you to keep your Bitcoin holdings secure from hackers. You’ll need to do due diligence research on finding the most secure digital wallets.

The largest digital wallet company in the U.S. is I would not keep my Bitcoin with the exchange you bought Bitcoin from. Not only is there the hacking risk, but if you keep it there my feeling is that you don’t own the Bitcoin, they do.

Another big myth is that Bitcoin really isn’t money. But it seems to me it is. I want you to think about some of the characteristics of money…

  • Limited supply – Bitcoins are limited, while some paper currencies (like Zimbabwe) are not.
  • Divisibility – Both dollars and Bitcoins can be broken up into smaller increments. Even though Bitcoin is trading at $10,000 you can buy $10 worth of it if you choose.
  • Uniformity – a dollar is a dollar and a Bitcoin is a Bitcoin. That is unlike primitive currencies like seashells.
  • Acceptability – U.S. dollars are accepted pretty much anywhere in the world. Bitcoin is not there yet, but that is changing. In April of this year, Japan passed a law stating that Bitcoin is acceptable as legal tender.
  • Durability and Portability – think about how gold’s characteristics fit these criteria. Here is the one weakness Bitcoin has. What if a nuclear electromagnetic bomb knocks out electricity for months? It will be a little tough to access your Bitcoin wealth.

Despite that, it still may make sense to put a little of your speculative money into Bitcoin. Bitcoin Investments But if you’re a stock market-type investor, there is still no pure-play way to invest into Bitcoin since the SEC continues to drag its feet on approving Bitcoin ETFs. And the Bitcoin Investment Trust (OTC: GBTC) still sells at a huge premium to the underlying value of the Bitcoins it holds. As of December 1, GBTC traded at $1,666 – but the Bitcoins it holds were valued at only $932.63.

That leaves only companies that are involved with Bitcoin, but in a peripheral way. Here are a few of those stocks: One very conservative way is through an exchange traded fund – the Ark Innovation ETF (NYSE: ARKK). The goal of this fund is to provide investors like you with exposure to innovation and new  technologies across a broad range of sectors. The ARKK ETF owns a position in the aforementioned Bitcoin Investment Trust. The Bitcoin Investment Trust is the number one position in its current 53 stock portfolio and it makes up 6.79% of the overall ARKK investment portfolio. In other words, any major selloff (noted short seller Andrew Left is short GBTC) won’t devastate the fund. 

Next on the list is the e-payments company founded by Jack Dorsey of Twitter fame, Square (Nasdaq: SQ). Its stock is up 180% year-to-date, although it is down about 20% from its recent Bitcoin-induced high. Square had already started to let its merchants accept Bitcoin as early as 2014. But the rocket to its share price was ignited when on November 15, Square permitted some of the users of its Square Cash app purchase Bitcoin. Square Cash allows customers to store money and send peer-to-peer payments without the use of a bank account. 

Last on the list is the retailer (Nasdaq: OSTK), which is up 142% year-to-date. Shares of the discount online retailer tripled since the start of August (before shedding a third in value recently) when it began letting shoppers pay with Bitcoin and other major digital currencies. The shares got a turbo-boost (23%) on September 27, when the company announced plans for an exchange for trading digital currencies. The stock got a similar boost recently after plans for an initial coin offering (ICO) were unveiled. If the ICO is successful, through its tZero subsidiary, Overstock will be the first major public firm to do so. ICOs have raised an astonishing $3 billion this year. I strongly suspect we will see more companies, such as Paypal (Nasdaq: PYPL), follow the Square path as Bitcoin becomes more mainstream, sending their stock skyward.

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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.
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Source: Investors Alley

5 Growth Stocks to Ride the Semiconductor Supercycle

It’s the silly season again on Wall Street. It’s the time of the year when analysts look ahead and tell us what they think.

Fortunately for you, it’s also the time of the year when major profit-making opportunities present themselves. Why? Because analysts from the major Wall Street firms are often 100% wrong. However, their pronouncements often will drive down the price of a stock or even a whole sector, creating that opportunity.

We saw a perfect example of that last week, when analysts from major firms including Morgan Stanley and JPMorgan among others downgraded the semiconductor sector. And of course, traders (or are they lemmings?) promptly dumped semiconductor stocks across the globe.

Semiconductor stocks were due for a pullback. Not only had they been the strongest sector in 2017, but the semiconductor index just recently passed a major milestone. The index just topped the record set in March 2000 at the height of the dot-com bubble. Experience tells me indexes often pause after attaining such a milestone.

Related: Buy These 3 Hot Semiconductor Stocks for Long-Term Profits

Semiconductor Supercycle

But let me get back to those Wall Street analysts. Many were basically saying, “Hey, the semiconductor cycle is over. Bad times are just around the corner.” And they are 100% wrong…

Because this cycle is different than the average cycle – we are in the midst of a supercycle that will go on for several years more.

I want you to think back to the commodity supercycle, which ran from 2000 to 2014. After the first few years, Wall Street analysts continued to proclaim that the cycle was over and that commodities and commodity stocks were due for a major tumble. But those analysts completely missed the fact that China was rapidly industrializing in a once-in-a-lifetime event.

Fast forward to today, and Wall Street analysts are missing the fact that products with semiconductors in them are becoming ubiquitous in every aspect of our lives. Artificial intelligence, Internet of Things, robotics, cloud computing, augmented reality, electric vehicles, and other technologies that will need lots of the latest generation of semiconductors are barely in the second inning of a very long ballgame.

Huge Growth Ahead

The growth the semiconductor industry is experiencing is clearly illustrated by a report issued on November 27 from World Semiconductor Trade Statistics (WSTS).

This year the market will reach $408.6 billion in valuation, a rise of 20.6% from 2016. That estimate is $30 billion larger than WSTS’s last report in June. This would be the first year of double-digit growth since 2010 for the industry and the first time ever sales exceeded $400 billion.

WSTS pointed to a number of factors for this growth including the spread of smartphones (and the constant replacement for upgrades), the growth in memory technology and the rise of video content. Memory chips, manufactured by the likes of Samsung and Micron Technology (NYSE: MU) now make up 30% of the semiconductor market and WSTS says this segment expanded by 60.1% in 2017.

It sees much more growth for this segment in particular thanks to the number of Internet-of-Things devices multiplying almost exponentially to more than 1 trillion units over the next few years. WSTS believes chip demand here will exceed even that from the 1.5 billion smartphones shipped annually. (Note: I explain much of this in my new Singularity report. If you’re not a regular Growth Stock Advisor reader then click here to check it out.)

Another demand driver, if you pardon the pun, will be our cars. They are rapidly turning into “data centers on wheels” according to the head of the automated-driving group at Intel (Nasdaq: INTC), Doug Davis in a story from the Nikkei Asian Review.

This growing demand may be lost on Wall Street analysts, but not by the chipmakers themselves. The research firm IC Insights sees $90.8 billion in capital investments this year, which is 35% more than in 2016: an obvious boost for chipmaking equipment sector.

5 Semiconductor Supercycle Investments

Here are five ways you can participate in the semiconductor supercycle:

The first and the broadest way you can invest in semiconductors is the MarketVectors Semiconductor ETF (NYSE: SMH). It owns 26 of the world’s top semiconductor-related companies such as Intel. The only major stock not in this portfolio is Samsung. This ETF has, of course, done very well for its holders. It has soared over 50% over the past year and is up about 42% year-to-date.

Second is the aforementioned Intel, the world’s biggest supplier of semiconductor products, which both designs and manufactures chips. The company is rapidly diversifying away from its PC-centered business. That was evidenced in its third quarter earnings report where results were pushed ahead by strong performances in its data center, Internet-of-Things and memory solutions groups.

Today, its chips can be found in iPhone modems, drones and self-driving cars. Its acquisition of Mobileye will significantly boost its presence in the autonomous vehicle market, accelerating Intel’s growth. Despite its move into growth areas, Intel’s stock still sells at a 15 p/e. The stock is up 21% year-to-date and 24% over the past 12 months.

Next on the list was the hottest stock in the market earlier this year, Nvidia (Nasdaq: NVDA). Its stock is still up 84% year-to-date and 108% over the past 52 weeks.

Founded in 1993, Nvidia like Intel, missed the entire mobile phone revolution. Its strength though, as always, has been in graphical processing units (GPUs), which run alongside CPUs. Gamers, such as those using the Switch console from Nintendo, love its GPUs. And, of course, its GPUs have been in the news a lot lately because of their popularity with the miners of cryptocurrencies like BitCoin.

I expect even faster growth for Nvidia as its processors become crucial to artificial intelligence, deep learning and driverless cars. As Goeff Blaber, an analyst at research firm CCS Insights said to the Financial Times, “Nvidia is at the center of AI, machine learning and deep learning.”

Next up is Broadcom (Nasdaq: AVGO), which is currently attempting to take over rival Qualcomm. Its stock is up 55% year-to-date and about the same amount over the past year.

The company’s origins date back to the 1960s at AT&T’s Bell Labs and also at Hewlett Packard. It supplies components to telecoms and industrial customers, which are used in items such as TV set-top boxes, smartphones, broadband infrastructure and energy systems. The company has particularly benefited this year from demand for its wireless solutions, but it is looking to the Internet-of-Things as a future driver of growth.

Finally, we come to Taiwan Semiconductor (NYSE: TSM), whose stock is up 37% year-to-date and about 33% over the last 12 months.

Apple (Nasdaq: AAPL) is believed to be designing its own power management chips for use in iPhones as early as next year. These new chips will be manufactured by Taiwan Semiconductor, the world’s largest contract chip manufacturer. It has been Apple’s sole supplier manufacturing chips for iPhones since 2016.

In 2016, Apple was the company’s number one customer, contributing 17% to its overall revenues. That contribution should be about 20% for 2017 and even higher in 2018, especially if it does begin to manufacture those power management chips. The growing relationship with Apple remains a big plus in Taiwan Semiconductor’s corner.

My bottom line message to you is to ignore the Wall Street lemmings and enjoy the semiconductor supercycle to its fullest.

Buffett just went all-in on THIS new asset. Will you?
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: Investors Alley

The #1 Pick to Stop Amazon from Taking Over the U.S. Drug Industry

A new word has appeared in American lexicon in the past few years: Amazoned, often used in the phrase, “to be Amazoned.” To me, it is a synonym for disruption. Just look at what (Nasdaq: AMZN)has done and what it threatens to do.

First, Amazon disrupted the U.S. book sector then the general retail industry, pushing many of the traditional companies in the sector it seems toward the dust bin of economic history. Then, the online retail giant moved into the roughly $800 billion U.S. grocery market in June with the purchase of Whole Foods. And once again, the traditional participants in the sector are seemingly headed the way of the dinosaur.

Now another sector may be in the sights of the gunslinger Jeff Bezos and his company – the $450 billion U.S. prescription drug industry. The question is whether this industry is ripe for disruption as were the retail and the grocery businesses.

Let me take you on a tour of the U.S. prescription drug industry value chain.

The Four Links in the Drug Distribution Chain

There are four basic links in the chain of how prescribed drugs get to you.

At the top of the chain is of course, the pharmaceutical companies that actually produce prescription drugs. These companies have little to fear from Amazon (at least for now).

The next link in the chain is the pharmacy benefit management companies, or PBMs. Their role is to negotiate drug prices with the pharmaceutical companies, process pharmacy claims and operate home-delivery pharmacies.

This sector is dominated by just three companies and they control three-quarters of the market. The three PBMs are Express Scripts (Nasdaq: ESRX), Caremark and Optum Rx. The latter two are controlled by the largest U.S. pharmacy chain CVS Health (NYSE: CVS) and the biggest U.S. health insurer UnitedHealth Group (NYSE: UNH) respectively.

Then we come to the next link in the pharma chain – the drug wholesale companies. And again there are three dominant companies, which distribute 90% of the drugs sold in the U.S. The companies are McKesson (NYSE: MCK)AmerisourceBergen (NYSE: ABC) and Cardinal Health (NYSE: CAH).

Finally, of course, there are the drug store chains that likely operate your corner drug store. And once again there are three main players – the aforementioned CVS Health, Walgreens Boots Alliance (Nasdaq: WBA) and Rite Aid (NYSE: RAD).

What Amazon Sees

I don’t know about you, but I think industries that are in effect oligopolies are perfect for disruption from Amazon.

It looks like something well-suited for Amazon… it is an industry big on logistics (physical and digital) – getting the right drug to the right person ASAP.

There is a lot of money being made here. For example, in the PBM segment, Express Scripts’ return on invested capital is in the mid-teens and it earns about $5 for every prescription filled. Can’t you imagine those numbers being brought down to next-to-nothing by Amazon?

Similar numbers are also prevalent in the drug distribution segment. Even the retail drug stores have numbers (return on capital, etc.) above what Amazon typically has. It is this potential threat from Amazon that has already wiped out over $40 billion of stock market value of the drugstore chains so far in 2017.

Related: This Technology Could Lead to the Downfall of Amazon

What Amazon Could Do

We don’t know what Amazon has planned. But it has quietly met with industry executives in recent months as well as made hires from insurers and PBMs. So I suspect something is in the works for 2018.

The company already has begun to sell professional medical equipment, which is part of the business that recently applied for wholesale pharmacy licenses in several states.

But the mystery remains as to where will Amazon aim its guns in the prescribed drug chain.

Unfortunately, I do not think it will be in the PBM segment. There is just too much medical expertise needed. Remember these are the people that control the “formularies” – the master list of drugs that employers and governments will pay for. Amazon would have to hire a lot of medical expertise at great expense. And I doubt it would want to get involved in whether patients could or could not have access to certain medicines.

But the drug distribution segment seems to be perfectly suited for disruption by Amazon. It has a massive logistics operation, which could easily start its own mail-based drug delivery business. That would bypass both the drug distribution firms as well as the drugstores. Having your prescriptions mailed to you by Amazon would simply be part of your Amazon Prime membership.

And do you think it would really be a stretch to see an in-store pharmacy pop up in each and every neighborhood Whole Foods?

That could tie in nicely with Alexa – “Alexa, refill my Lantus (the top-selling insulin drug)”. The prescription could then be picked up by you at a Whole Foods pharmacy or at pharmacies that Amazon has made agreements with.

Where to Invest

So how can you invest in what is likely to be a vastly changing landscape for the distribution of U.S. prescription drugs?

One obvious choice is the subject of this article – Amazon. It will continue growing and disrupting industry after industry. The only possible obstacle is if the government goes the anti-trust route and muddies the waters for the company.

Among the companies in the prescription drug distribution sector, I believe the best of the lot is UnitedHealth Group. About 40% of its revenues come its Optum Rx PBM business, with the remaining 60% of revenues coming from its vast health insurance businesses.

Its membership has been growing steadily for many years thanks to its leadership position in private health insurance in both North and South America. As of the end of 2016, it served 48.6 million members, up 4.7% year-on-year. In the first nine months of 2017, membership rose to 49 million people, up 2% year-on-year.

And the Optum PBM business is booming. In 2016, revenues grew 24% to $83.6 billion. The trend continued into 2017 with earnings for the first nine months of the year rising by 15%. This will help maintain the company’s enviable track record of a compound annual growth growth rate (CAGR) of 11% in its revenues from 2006 through 2016.

No surprise then the company raised its guidance for 2017 earnings to about $10 a share, a gain of 24% year-on-year. That will continue to boost its stock, which has risen 31% year-to-date and 38.5% over the past year.

It is the only pure play in the sector I would own in the face of a likely disruption coming in the form of Amazon in the near future.

Buffett just went all-in on THIS new asset. Will you?
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: Banyan Hill 

Find Triple Digit Returns from Your Kid’s Video Games

This digital age in which we live is literally changing everything. . .including when it comes to sports. Forget physical smashmouth sports like football and hockey. This new generation of sports fan wants to see lots of action – but only on a digital screen.

Welcome the world of e-sports, which unlike most sports, originated in Asia. The love of such activities extended to the stock market as Monday saw a red-hot IPO in Hong Kong, called Razer, debut. The company is the “arms merchant” for serious gamers making mice, headsets and notebooks.

And I do mean serious gamers. There are tournaments where there is a $10+ million top prize.

It’s hard for someone not a teenager or in their 20s, like myself and maybe you, to understand the attraction of e-sports. But one thing I do understand – it is already a huge business and growing rapidly.

e-Sports Business

I want you to think for a moment about its potential. In sheer numbers, video gaming is a market that is bigger than China and larger than the number of Facebook users (over one billion). And last year, the sport’s fans watched more than 6 billion hours of competitive gaming!

Related: 3 Tech Stocks Up More than Apple, Facebook, and Google.

According to data from the consultancy Frost & Sullivan, the global industry generated more than $100 billion in 2016! Of that figure, e-sports is still rather small, at about $892 million. A rather conservative forecast from another consultancy, PricewaterhouseCoopers, says the industry will generate $133 billion in revenues by 2021. The investment bank Macquarie forecasts that e-sports will be a $5 billion business by 2020.

I think the $5 billion number will even be exceeded by 2020. You see, there are three main areas where e-sports can produce revenues. First is direct payments from live streaming services – some live tournaments have tens of millions of viewers. Last year, there were 11.1 billion e-sports videos streamed in China and 2.7 billion in North America, where about one-third of gamers reside.

The next source of revenue is the sale of content rights to broadcasters. Finally, advertising revenues, which today come largely from the gaming industry. But it isn’t hard to imagine a whole raft of companies looking to get their message in front of millions of viewers. That new reality is already beginning to unfold, which I will show you in a moment.

e-Sports Growth

The growth of e-sports looks to just be accelerating with two Las Vegas casinos planning to build dedicated e-sports arenas.

More importantly, the backers of e-sports are being smart and adapting what works for traditional sports and applying it to e-sports. Such as creating a league and having teams in many of the major cities. The parent companies of the New England Patriots, Los Angeles Rams and the New York Mets now own franchises (at a cost $20 million) in the first attempt to create an actual league.

The teams were sold by the world’s largest publisher of video games, Activision Blizzard (Nasdaq: ATVI), which came up with the idea of a 12-team Overwatch League. Unlike traditional sports leagues, this league also has teams from London and Shanghai.

The Overwatch League is not the only e-sports league in existence. There is a similar venture from Riot Games, which is owned by Chinese tech giant Tencent (OTC: TCEHY). It is charging $10 million for franchises in the North American League of Legends Championship Series. Over 43 million people watched last year’s League of Legends World Championship online, up from just 8 million in 2012. Major venues such as Seoul, South Korea’s Olympic Stadium were sold out to watch the event.

The build-out of leagues is already attracting sponsors, as I hinted at before. Both Intel (Nasdaq: INTC) and HP (NYSE: HPQ) are lead sponsors for the Overwatch League, whose regular season starts on January 10.


e-Sports Investments

So how can you invest into this e-sports phenomena?

You’ll want to look at companies whose business is heavily e-sports related. A firm like (Nasdaq: AMZN), which paid about $1 billion in 2014 for Twitch – the favorite live streaming platform to watch gamers battling has many other businesses. Even with a $1 billion price tag Twitch is just too small a part of Amazon to significantly affect the company’s performance.

At the top of my buy list is the aforementioned Activision Blizzard, which also has a live streaming channel called Major League Gaming. It acquired the firm in 2016 for $46 million.

I believe its CEO, Bobby Kotick, really understands the video gaming and e-sports better than the CEOs at its rivals. He sees e-sports as becoming more broad-based in its appeal in 2018 and I agree. During the company’s latest earnings conference call, he said “We view that (e-sports) as a major growth initiative and a very sizable standalone opportunity for the company.”

The company is already enjoying the growth in the general gaming industry with $1 billion from in-game (digital games) revenues in the last quarter. It currently has eight $1 billion franchises, including the very popular Call of Duty.

Not surprising then Kotick raised the company’s guidance for the next quarter and that the stock is up nearly 75% year-to-date and almost 60% over the past year.

Next on the list is a rival of Activision, Take Two Interactive Software (Nasdaq: TTWO), which is best known for its Grand Theft Auto franchise. Its stock soared nearly 10% after its recently-released earnings report.

While trailing in the e-sports business, the company is finally moving ahead now. It inked a deal with the NBA to launch a NBA eLeague. The NBA will be the only major professional sports league to have its own e-sports league. The league will begin in May 2018 with so far 17 of the 30 NBA teams saying they will play for at least three years.

Take Two is also expanding rapidly into mobile games. It strengthened this area of the company with its acquisition of Barcelona-based Social Point for $250 million earlier this year. Social Point is one of the most prolific mobile games developers.

Again not surprisingly, Take Two management also raised guidance for its next quarter. Its stock has even outperformed Activision with a 133% gain for the year so far and it has risen 140% over the past 12 months.

See also: Buy These 3 Hot Semiconductor Stocks for Long-Term Profits

Finally, an alternative way to play the e-sports trend is through the semiconductor company, Nvidia (Nasdaq: NVDA). Its stock has soared 101% year-to-date and 144% over the past 52 weeks. As I’m sure you may know, Nvidia is a worldwide leader in visual computing technologies and the inventor of the graphic processing unit, or GPU.

The key to its rapid growth to date has been the video gaming industry. The company continues to steadily gain market share among gaming service providers, strengthening the company’s position in the workstation-based gaming services in supercomputing segments. That’s because its lineup of advanced graphics and gaming cards offer significantly higher functionality. That should continue to be a strong tailwind for Nvidia.

You also need to add in the company’s moves into the latest tablet computers and the automobile technology space and data centers and Nvidia continues to tell an exciting tale. Its recent alliance with China’s Baidu (Nasdaq: BIDU)on artificial intelligence (AI) technology could also be another big winner for Nvidia.

Bottom line – you may not understand video gaming or e-sports, but do realize they will continue to be big money winners in the years ahead.

Buffett just went all-in on THIS new asset. Will you?
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.

3 Stocks for Double Digit Gains from Personalized Medicine

A recent approval from an U.S. Food and Drug Administration (FDA) advisory panel has heralded a new era of medicine. An era where diseases are tackled in a totally different way, by inserting into disease sufferers functioning copies of genes that are either missing or mutated.

Gene therapy is a complex subject. So think of it this way…

Your genetic sequence is like a long book and your body is essentially a DNA ‘reading machine’. Each gene or ‘word’ sends a signal to your body to produce a specific protein it needs in order to function normally and healthily. The problem is that you and I and everyone else have genes that are mutated. Think of them as ‘typos’. Depending on the severity of the ‘misspelling’, diseases – some of them very serious – may result.

That’s where the promise of gene therapy lies, replacing the faulty genes with normal ones. In other words, diseases are tackled right at their biological source with a one-time only treatment.

I want you to think about the state of modern medicine today. Patients are giving chemicals (drugs) that treat the symptoms of various diseases for a few hours at a time. But gene therapy means diseases such as cancer, Parkinson’s, cystic fibrosis and many other diseases could possibly be cured.

First FDA Approval

The aforementioned approval from the FDA was for a product called Luxturna, which was developed by Spark Therapeutics (Nasdaq: ONCE). Notice the symbol for Spark, emphasizing its treatments are one-time only.

Luxturna is designed to help a subset of those diagnosed with Leber congenital amaurosis (LCA) that have a mutation in a gene known as RPE65. Sufferers of this particular diseases number about 6,000 in the developed world, including the United States. People with LCA suffer severe vision loss and are at high risk of becoming totally blind.

Many of the patients treated with Luxturna in the Phase III trial are once again enjoying the gift that is vision. So everything looks idyllic for this type of treatment, right? There is one major hitch though – the current sky-high price for such treatments. Spark is waiting to set the price of Luxturna until its gets official FDA approval in January, but it is expected to be in the $700,000 to $900,000 range per eye.

This price looks then to be in the same ballpark as two CAR-T therapies recently approved by the FDA – Kymriah ($475,000) and Yescarta ($373,000). CAR-T is a form of gene therapy that harnesses a patient’s own immune system to attack and kill cancer cells.

Despite the high price, gene therapies may be worth it if they indeed do cure the diseases.

And I believe that gene therapies will become much more affordable. As with almost every technology, the price will decline as the market for them grows larger in scale. In other words, larger eligible patient populations will equal lower prices for every treatment.

Gene Therapy Investments

As you can imagine, many of the major pharmaceutical companies are getting involved in gene therapies, such as Novartis AG (NYSE: NVS) and GlaxoSmithKline (NYSE: GSK). But I would prefer more of a pure play in the sector. Here are several companies to consider.

Gene Therapy Stock #1 – Spark Therapeutics

Let’s start with Spark Therapeutics. Most of the company’s $2.8 billion market capitalization is not due to Luxurna. The real excitement for the company comes from several early-stage gene therapy projects that are aimed at hemophilia.

Spark reported positive initial data from its Phase I/II trial of SPK-9001 in hemophilia B, which is a serious and rare inherited hematologic disorder, caused by mutations in the FIX gene that leads to deficient blood coagulation and increased risk of hemorrhaging. Spark is working with Pfizer (NYSE: PFE) to develop this treatment.

The company also initiated the Phase I/II trial for SPK-8011 for hemophilia A. This disease is characterized by a mutation in the FVIII gene and again results in deficient blood coagulation.

These hemophilia therapies would address a larger market than Luxturna since there are about 190,000 sufferers around the globe. A one-time treatment, even with a big price tag, would likely look good to cash-strapped health systems. That’s because infusions for a single hemophilia patient can cost about $500,000 per year.

Spark Therapeutics’ stock is up nearly 60% year-to-date and 66% over the past year.

Related: 3 Stocks for Tailor-Made Cancer Cures

Gene Therapy Stock #2 – Bluebird Bio

The second company to consider is Bluebird Bio (Nasdaq: BLUE), founded in 1992, and has expertise across the areas of gene editing, T-cell immunotherapy and lentiviral-based gene therapies. It does have a pretty broad pipeline including:

  • Lenti-D, which is in the Phase II/III Starbeam Study, and is targeted at childhood cerebral adrenoleukodystrophy.
  • Lentiglobin, which are in four Phase I/II studies, and is aimed at patients with rare hemoglobinopathies – severe sickle cell disease and transfusion-dependent ß-thalassemia. The stock soared over 10% at the start of November when results were announced that updated data would be revealed in December.

Other therapies in earlier stages of Bluebird’s pipeline are: bb2121 and bb21217 for multiple myeloma, BCL11a shRNA for severe sickle cell diseases, as well as several oncology treatments at the pre-clinical stage. On bb2121, it is partnered with Celgene (Nasdaq: CELG) in the Phase I study.

Overall in 2017, the stock is up 137% so far and it has doubled over the past 12 months.

Gene Therapy Stock #3 – AveXis

The third clinical-stage company worth a look is AveXis (Nasdaq: AVXS). The company’s primary focus is on gene therapies to develop a cure for Spinal Muscular Atrophy (SMA), Rett Syndrome and a genetic basis for ALS (Lou Gehrig’s disease).

AveXis’ stock spiked on September 29 after the FDA gave the go-ahead for the company to go forward with its pivotal clinical trial (STR1VE) on its flagship AVXS-101 candidate for the treatment of SMA. The treatment uses neutered viruses as a delivery mechanism for healthy genes to suffering patients. These genes will begin in the body production of a protein, the lack of which – called survival motor neuron – causes the disease.

Short sellers had targeted AveXis claiming it would not be able to produce its treatment for SMA in sufficient quantities while meeting the FDA’s high manufacturing standards. The FDA go-ahead should allay some of those fears.

AVXS-101 has shown good results so far. Earlier this year, AveXis showed that nine children with a particularly severe form of SMA, who were dosed for 20 months, are all alive and well. That compares to an average of 8% of untreated children that would be on major breathing support, if they were still alive.

The company’s stock has soared 112% year-to-date and 53% over the past 52 weeks.

The performance of all three of these stocks is remarkable in what has been not a good year for many biotech stocks. Gene therapy is a paradigm shift in how to treat people afflicted with diseases, offering potentially very high profit opportunities. More good gains should follow for the companies in the sector as science fiction slowly becomes reality.

Let the basic premise sink in for a second. Diseases and conditions like hemophilia, ALS, even blindness are on the cusp of being cured with one treatment. Not managed. Not endured. But cured. Forever.

And all of that’s possible from the convergence of biology, chemistry, computer technology, even government policy. We’re looking at a whole new era for humankind, one where one day in a new world practically every disease can be cured.

Buffett just went all-in on THIS new asset. Will you?
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.

3 Tech Stocks Up More than Apple, Facebook, and Google

Perhaps the most exciting segment of the Singularity for me is the Industrial Internet of Things (IIoT), which will change forever how things are made. It’s the reason some are calling it the Fourth Industrial Revolution.

I’ve written often about two of the main sectors contained in the IIoT. The first is cobots or collaborative robots that will work together with humans in manufacturing. The second is additive manufacturing, which is also known as 3D printing because it involves building objects layer by layer out of substances such as metals or polymers.

But I’ve barely touched upon a third area – digital twins. Let me now fill you on this and point to a few companies heavily involved in the use of digital twins.

What Is a Digital Twin?

A digital twin is a virtual copy of a real machine or system. It is sometimes described as a bridge between the physical and digital worlds. These virtual models are built up based on many gigabytes and terabytes of sensor data. It is an outgrowth today of much cheaper and better sensors, data transmission and data analytics.

In simplest terms, a digital twin works on a simulation platform connected to a predictive analytics platform and which gathers data from a range of sensors from a wide scope of devices/machines and then analyzes the data.

However, a digital twin is not exactly a new concept. NASA developed the concept of a digital twin for its space shuttle program.

Here is a basic example of the usefulness of digital twins: In the past, car companies would build prototypes and then crash them to see whether the cars would hold up to real world situations. Now with digital twins, car companies can use CAD (computer-aided design) data and simulate crashes to see how well their car design will hold up.

Of course, the uses for digital twins extend far beyond cars. It includes oil rigs, jet engines, wind turbines, power plants and pretty much anything worth monitoring.

The value of digital twins to companies is obvious. It offers them numerous advantages throughout the entire lifecycle – from product design, production planning and engineering, to commissioning, operation, servicing and modernization of plant systems and equipment.

Virtual twins allow companies to validate designs earlier and test the configuration of a machine or product or system in the virtual environment. By carrying out checks earlier in the engineering process, the risk of failures and errors in critical phases of the lifecycle, for example during commissioning, is reduced. Eliminating such risks would otherwise only be possible with great effort, cost and time.

Any subsequent modifications can be tested and verified in exactly the same way, accelerating the introduction of a new product. Furthermore, with the help of these virtual models, the operating data can also be used to optimize parameters for production such as energy consumption.

Digital Twin Market Potential

As you can imagine, the potential for virtual twins is vast. According to the German Association for Information Technology, Telecommunications and New Media, every digital twin in the manufacturing industry will have an economic potential of more than 78 billion euros (over $90 billion) by 2025.

A report from TechSci Research says that the digital twin market is expected to grow at a compound annual growth rate (CAGR) of 37% during the forecast period 2017 through 2022. The report points to high demand from the electronics and electrical/machine manufacturing industry as the main driver behind this high growth rate.

Not surprisingly with any rather new technology, the growth geographically is coming from the Asia Pacific region. The firm Research and Markets says that region led the way in 2016 in the overall digital twin market and is expected to continue leading in the 2017 to 2023 period.

This kind of growth rate is what you should look for in an investment and is similar to what I’ve seen in the robotics sector.

Digital Twins Investments

So how can you invest into this exciting new part of the Industrial Internet of Things?

There are a number of very large companies involved in the space including tech giants Microsoft (Nasdaq: MSFT)and Oracle (NYSE: ORCL) as well as industrial powerhouses General Electric (NYSE: GE) and Siemens (OTC: SIEGY).

But instead of these large companies, I prefer the smaller software companies that are involved with CAD design modeling. Here are three companies to consider.

Living in western Pennsylvania, the company at the top of my list is from the area – ANSYS (Nasdaq: ANSS). It is a dominant player in the high-end design simulation software market and is used by most of the well-known manufacturing companies.

The company generates revenues in two areas – software licenses (57.5% of 2016 revenues) and maintenance and services (42.5%). Revenues in 2016 were about $988 million. I expect revenues to climb significantly in the years ahead as the company expands its simulation solutions to areas like 5G  telecommunications product designs, autonomous vehicles and ADAS systems, as well as the Industrial Internet of Things.

Its stock spiked 10% last week on the back of a great earnings report. It also recently closed a three-year contract worth over $45 million, which was the largest in the company’s history. The stock is now up 60% year-to-date and 77% over the past 12 months.     

The second company is Cadence Design Systems (Nasdaq: CDNS). Over 90% of its revenue is recurring, which is outstanding.

In addition to IIoT, it is also involved other fast-growing sectors such as aerospace, autonomous vehicles and augmented and virtual reality (AR/VR). It has won orders from Infineon and MobilEye who are developing advanced driver assistance systems (ADAS) technologies. However, its core currently remains the semiconductor market and the design of integrated circuits.

The stock’s performance has been stellar with a gain of 75% year-to-date and 77% over the past year.

The final company is Autodesk (Nasdaq: ADSK), which generated over $2 billion in revenues in fiscal 2017. It serves customers in architecture, engineering and construction, manufacturing, and digital media and entertainment.

The company’s business transition from licenses to cloud-based services should benefit it over the long-term through higher subscriptions and deferred revenues. Its management forecasts long-term CAGR of 20% from subscriptions that will lead to 24% CAGR in recurring revenues.

That forecast along with its results have propelled the stock 68% higher year-to-date and nearly 80% over the past year. One caution though – on a non-GAAP basis, it is still losing money.

I do expect though all three of these companies’ stocks to continue outperforming the general market.

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