Earnings per share estimates are badly out of whack right now, which is skewing valuation metrics investors use to judge whether stocks are properly valued.
The market volatility from the coronavirus pandemic has created a lot of uncertainty that has caused a delay in analyst updates of their EPS estimates.
That has stocks looking cheaper than they really are.
Earnings per share estimates are badly out of whack right now, which is skewing valuation metrics investors use to judge whether stocks are properly valued.
The market volatility from the coronavirus pandemic has created a lot of uncertainty that has caused a delay in analyst updates of their EPS estimates.
That has stocks looking cheaper than they really are.
And the gap is shockingly huge...
My glasses almost fell off my face Monday night when I read this headline from Bloomberg...
"ETF Investors Are All-In on Stimulus with $17 Billion Stock Bet"...
That's right. Investors have pumped more than $16.5 billion into stock exchange-traded funds in just seven trading days in April.
The article stated that the "torrid" pace put inflows on track to exceed December's monthly inflow total of $42.5 billion.
Talk about a crowded trade...
What's happening right now is a toxic combination of analysts saying, "The bottom's been put in!" and also, "Buy the dips!"
Yes, you can start to buy in. Slowly. Use dollar-cost averaging and buy in increments.
But going all in... Well, there's a reason the great Wayne Gretzky said to skate to where the puck is going, not where it has been...
That's exactly why the last time I saw this happening, in December, I bought puts. And they paid off heavily in January and February, such as my 47.87% January gain on FedEx and my 108.57% February gain on Tilray.
The truth of this market is that there's still too much uncertainty, fundamentals are questionable, and technicals are pointing to the downside.
This type of long bet - with people throwing money into the market with coal shovels because it's been climbing for a few weeks- tells me one thing: We're still in the first stage of the market pullback.
Earnings season is wrapping up, and as usual, a lot of profits have been left on the table.
This should be the most profitable time of year. But so many traders miss the best opportunities.
That's why I trade earnings differently than everyone else.
I'm not an analyst. I don't give much thought to revenue and earnings per share (EPS). If you only focus on the top and bottom line, earnings can get really complicated, really quickly.
So I created my three-step earnings trading plan.
This plan simplifies the earnings process and still comes loaded with that same exciting profit potential that earnings brings.
For anyone who doesn't feel like they're making as much as they could from earnings, this plan will help you profit every single quarter, like clockwork.
Here's all you need to do... Full Story
With earnings season now hitting a full swing, the opportunities really start to pop.
The Dow and S&P 500 both broke three-week losing streaks last week, and the Nasdaq Composite was up for the second week in a row.
We're heading back up closer to all-time highs.
So why do I say this is just a "kind-of rally" with all this seemingly good news?
Last week was an otherwise down week if not for the one positive lifting market on Friday: trade talks.
This was good news, until it was stripped down and re-rated by market judges.
The United States looked like it scored a victory because China agreed to purchase $40 billion to $50 billion in U.S. agricultural products, at least according to the White House, but the time frame of any purchases wasn't immediately clear.
Also, China agreed to open its market to international financial services, again according to the White House. Trump, potentially allowing U.S. banks and insurance companies to expand in China: no timetable there either.
China looks like it scored on account of the United States not moving forward on Oct. 15 with a planned increase in tariff rates to 30% from 25% on about $250 billion of Chinese goods.
Canopy Growth disappointed investors with its quarterly earnings. In fact, investors were so "disappointed" by this one report they sent the entire cannabis sector tumbling.
That's the thing: Canopy's results mean essentially nothing at all for American marijuana companies - nothing for any company outside Canada, in fact.
It's no different than if, say, California-based PG&E shares tanked because Consolidated Edison had a power failure in New York City.
But we're still in the early stages of legal cannabis' explosive growth potential.
Canopy led the sector down because investors are expecting results yesterday. And the results can be longer in coming than short-sighted investors might like.
So before you run out and sell all your Canopy shares, you need to see what I'm about to show you...
Our Technical Trading Specialist is continuing to keep a close watch on the markets for the week ahead, including the most impactful earnings reports and sector that will act as a bellwether for the broader economy…
The past few months have seen some minor scandals push marijuana shares’ prices down, which is natural in a new industry like this.
Aphria, however, zoomed to an intraday high of $7.45 after announcing earnings.
The company increased its net cannabis revenue by 85%, which is a big deal – and it won’t be the only cannabis firm to do that.
Our Technical Trading Specialist is looking at all the big earnings plays ahead during this crucial week for the markets as earnings season comes to a close.
Aphria reported its fiscal fourth-quarter earnings last week, and the company exceeded all expectations.
And it beat those estimates from underneath a cloud of short sellers' spurious innuendo, to boot.
After a quarter of overall decline in Canadian cannabis revenue, Aphria saw an increase of 85% - that's 85% sequentially and not year over year. The company also turned earnings before interest, tax, depreciation, and amortization (EBITDA) positive - albeit after adjustments and with help from a European pharmaceutical distribution business the company owns.
And to top it off, management's optimistic about the future.
So any investor could look at Aphria's reporting and conclude it had a great quarter. And they'd be dead on.
What might not be so obvious at first glance is that this company just showed investors how it was going to take the cannabis sector to the next level.
There’s much more here than meets the eye…
Earnings season is now in high gear, and as I predicted last week, the numbers are coming in stronger than the pundits expected.
That was definitely the case with the big banks last week; Goldman Sachs blew the doors off Wall Street's expectations, posting earnings of $5.81 versus the $4.89 analysts had on the board. JPMorgan posted earnings of $2.82 versus estimates of $2.50.
JPMorgan's CEO, Jamie Dimon, noted "positive momentum with the U.S. consumer - healthy confidence levels, solid job creation, and rising wages."
Now, it's certainly true the consumer is stronger than the headlines suggest. That's a truth we talk about frequently.
But that's not the real story...
The truth is something you and I and just about every American know deep down: There are some significant challenges facing U.S. consumers right now.
I'm talking about very real inflation - the existence of which the Fed has denied for years now - and the ever-increasing levels of consumer debt out there.
The two are related, despite what you might hear coming out of Washington and Wall Street.
We've had a few "appetizers," but the full earnings season is here now.
These reports can make traders and investors really anxious, when they hope they've bought the right stock, or put on the right trade with calls or puts.
Trouble is, moving ahead of an earnings release and hoping things simply break your way is the absolute worst way to be in the markets. You can lose your shirt, and chances are you will.
But when you play it right with the Money Calendar, like you'll see in the video I'm about to show you, all that anxiety turns to excitement... over what you're going to do with all the extra cash. You'll sleep better, too - believe me.
Why? Because this method slashes your risk to a minimum, even as it boosts your potential for profits.
Just watch how easy and hassle-free it is to make money at this time of year...
Well, believe it or not, Q2 earnings season is upon us – and it’s widely expected to be a downer.
With the average decline in earnings coming in around 2.6%, it’ll be the second straight quarter of declines year over year.
By comparison, the average estimated earnings decline was just 0.5%, so this is potentially a big deal.
But not to worry, because Keith’s going to show you how to capture all the upside…
Constellation Brands Inc. (NYSE: STZ) has grown 20% in the last six months, and Wall Street projects it will grow another 46% with a high target of $288.
That’ll register as 66% growth for 2019.
But there’s plenty of reason to believe this projection is not generous enough.
Wall Street has shown, on multiple occasions, that it does not fully appreciate the growth potential of Constellation Brands.
Some shady financial practices have inflated the stock prices in this sector, but this one strategy weeds out the sick companies from the healthy.
