One of my favorite things to do when market conditions are trending bullish is to find good companies with solid financials whose stock has gotten beaten up for one reason or another, so I can buy them at a deep discount and enjoy the ride back up.
And in a stock market where all the most famous names are tech companies that are so diversified and research-driven that it's basically impossible to summarize what they do, it's important to remember that there are a ton of great companies out there quietly checking off all the Econ 101 boxes.
What I mean by that is, they provide products and concrete solutions that fulfill a straightforward market need, they make consistent profits and have an overall trend of earnings growth, and they continue to grow their market cap year-over-year.
Well, one of these companies is on my radar today, a California firm that's grown to an almost $2.7 billion market cap by being a leader in a rather niche field - selling boutique hair care products online.
I know what you're probably thinking. But the numbers don't lie. Back in 2019, they did $148 million in sales. By the end of last year, they grew that to $704 million. Their profit margin is an astonishing 32%. The bottom line is, it's a solid company that makes solid money in a business that is always going to be in demand.
Growth has slowed somewhat, thanks to overall trends in retail spending, and it's definitely true that the proverbial bloom is off the rose when it comes to e-commerce. That's why it's currently sitting at around -84% from its all-time high and has mostly traded sideways in 2023.
But all it'll take is one good tailwind to send the stock soaring, and when it does, you can expect it to more than make up for its prior losses.
Check out the video for the ticker:
Check back with me later in the week for a full review of what stocks are likely to thrive after the CPI and PPI announcement tomorrow... and which ones will probably sink like a stone. Take care until then.
The post Here's What It'll Take to Make This Stock Zoom 84% - and More appeared first on Total Wealth.
About the Author
Shah Gilani boasts a financial pedigree unlike any other. He ran his first hedge fund in 1982 from his seat on the floor of the Chicago Board of Options Exchange. When options on the Standard & Poor's 100 began trading on March 11, 1983, Shah worked in "the pit" as a market maker.
The work he did laid the foundation for what would later become the VIX - to this day one of the most widely used indicators worldwide. After leaving Chicago to run the futures and options division of the British banking giant Lloyd's TSB, Shah moved up to Roosevelt & Cross Inc., an old-line New York boutique firm. There he originated and ran a packaged fixed-income trading desk, and established that company's "listed" and OTC trading desks.
Shah founded a second hedge fund in 1999, which he ran until 2003.
Shah's vast network of contacts includes the biggest players on Wall Street and in international finance. These contacts give him the real story - when others only get what the investment banks want them to see.
Today, as editor of Hyperdrive Portfolio, Shah presents his legion of subscribers with massive profit opportunities that result from paradigm shifts in the way we work, play, and live.
Shah is a frequent guest on CNBC, Forbes, and MarketWatch, and you can catch him every week on Fox Business's Varney & Co.