On October 6, 2008, I recommended readers buy shares of Bank of America Corp. (NYSE: BAC).
Bank of America at the time had just agreed to acquire Merrill Lynch and Co. The strategy I recommended called for taking a prudent position in the bank by buying increasing amounts of shares on any market pullbacks.
The strategy appeared to go as planned at the very beginning as the shares dropped in value as predicted, improving the average buying price. But Bank of America subsequently revealed large amounts of troubled assets that had not been evident in prior releases. The company's president and chairman lost his job as a result, and the stock continued to drop. Today, after a very strong recovery BofA stock is still trading some 30% below our initial recommended entry price. So, depending on how one executed the entry strategy, one would be some 10-15% down even today.
Horacio R. Marquez
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Buy, Sell or Hold: The Boeing Co. Is Flying High and Ready to Soar Even Higher
Last Dec.14 I gave you my global outlook for 2010. I recommended three key stocks that would be flying this year: The Boeing Co. (NYSE: BA), Corning Inc. (NYSE: GLW), and Cypress Semiconductor Corp. (NYSE: CY).
So far, they have all enjoyed rallies.
Boeing rose 29% in about three months, Corning has appreciated about 7%, and Cypress Semiconductors is up 11%. So all three beat the Standard & Poor's 500 Index, which is up 6% over the same time period.
I remain very bullish on all three companies, but today we will focus exclusively on Boeing.
Boeing continues to ride very powerful trends, and the company is executing well.
So far, they have all enjoyed rallies.
Boeing rose 29% in about three months, Corning has appreciated about 7%, and Cypress Semiconductors is up 11%. So all three beat the Standard & Poor's 500 Index, which is up 6% over the same time period.
I remain very bullish on all three companies, but today we will focus exclusively on Boeing.
Boeing continues to ride very powerful trends, and the company is executing well.
Buy, Sell or Hold: BHP Billiton is Poised to Pick Up Big Gains on the Back of a Global Commodities Bull
Face it, commodity prices are in a secular rally - and there are three big reasons why.
- Loose Monetary Policy
- Growing Demand in Emerging Markets
- And the Congruent Devaluations of Major CurrenciesWe've already profited from this inflationary trend in the Money Map VIP Trader. And - just like I did with the broadband revolution - today I am presenting you with a stock that stands to benefit from these developments - BHP Billiton Ltd. (NYSE ADR: BHP).
Buy, Sell or Hold: Bank on the Broadband Revolution with EMC Corp. (NYSE: EMC)
Major fund managers on Wall Street continue to be very cautious and underestimate certain key trends - one of which they have yet to even catch on to.
In the last few weeks, I recommended you to invest in a number of companies that are linked to this underestimated trend: The broadband explosion.
In fact, we got into Cisco Systems Inc. (Nasdaq: CSCO) before that company unveiled its new "super-router." I also recommended buying other beneficiaries of the broadband trend, including Juniper Networks Inc. (NYSE: JNPR) and JDS Uniphase Corp. (Nasdaq: JDSU). Today, we continue diversifying into other beneficiaries with a very strong player: EMC Corp. (NYSE: EMC).
In the last few weeks, I recommended you to invest in a number of companies that are linked to this underestimated trend: The broadband explosion.
In fact, we got into Cisco Systems Inc. (Nasdaq: CSCO) before that company unveiled its new "super-router." I also recommended buying other beneficiaries of the broadband trend, including Juniper Networks Inc. (NYSE: JNPR) and JDS Uniphase Corp. (Nasdaq: JDSU). Today, we continue diversifying into other beneficiaries with a very strong player: EMC Corp. (NYSE: EMC).
Buy, Sell or Hold: JDS Uniphase Corp. (Nasdaq: JDSU) Is Yet Another Rising Star in the Broadband Revolution
We keep getting good news with respect to the broadband revolution. If you have not read my prior posts, do not miss this special report on it. These developments are revolutionizing the tech world right now and we are at the very inception of an explosive and highly profitable trend.
For starters, both the U.S. economy and the global economy are faring much better than most of the market expected. In fact, last Friday we saw February's retail sales blow away even the most optimistic forecasts. Sales excluding autos did particularly well, which is good news for Internet sales.
We also saw Cisco Systems Inc. (Nasdaq: CSCO) launch its new "super-router” which is many times faster than existing devices. This will speed up network traffic, enabling faster video, teleconferencing and downloading. More traffic means more bandwidth, and that means more infrastructure.
For starters, both the U.S. economy and the global economy are faring much better than most of the market expected. In fact, last Friday we saw February's retail sales blow away even the most optimistic forecasts. Sales excluding autos did particularly well, which is good news for Internet sales.
We also saw Cisco Systems Inc. (Nasdaq: CSCO) launch its new "super-router” which is many times faster than existing devices. This will speed up network traffic, enabling faster video, teleconferencing and downloading. More traffic means more bandwidth, and that means more infrastructure.
Buy, Sell or Hold: Juniper Networks Inc. (NYSE: JNPR) Will Be the Next Company to Profit from the Broadband Boom
Given the lightening fast expansion that we are seeing in broadband market - something I mentioned last week in my recommendation of Cisco Systems Inc. (Nasdaq: CSCO), we are going to look at another strong beneficiary in the sector: Juniper Networks Inc. (NYSE: JNPR).
Juniper Networks beat estimates by a mile in its recent earnings report. It beat both on sales and margins expectations. However, some analysts have raised questions about the company's strategy. And I am one of them.
Let me explain.
Juniper Networks beat estimates by a mile in its recent earnings report. It beat both on sales and margins expectations. However, some analysts have raised questions about the company's strategy. And I am one of them.
Let me explain.
Profit From the Broadband Explosion With Cisco Systems Inc. (Nasdaq: CSCO)
Last Friday I unveiled my two most compelling stock ideas to the readers of my Money Map VIP trading service. They are the best ways to hop onto an exploding trend that I recently discovered and researched extensively - the exponential explosion in broadband traffic.
To learn more about this broadband explosion - and the two top stock picks I isolated from my research - check out this new report. It's a huge issue - with the potential to cause the kinds of network breakdowns and outright outages that could cost the economy billions of dollars and that could even cost people their lives.
In the course of my research, I discovered a third company that's perfectly positioned to benefit from this broadband paralysis. My conclusion: Cisco Systems Inc. (Nasdaq: CSCO) is going to see a lot of upside from this trend, too.
To learn more about this broadband explosion - and the two top stock picks I isolated from my research - check out this new report. It's a huge issue - with the potential to cause the kinds of network breakdowns and outright outages that could cost the economy billions of dollars and that could even cost people their lives.
In the course of my research, I discovered a third company that's perfectly positioned to benefit from this broadband paralysis. My conclusion: Cisco Systems Inc. (Nasdaq: CSCO) is going to see a lot of upside from this trend, too.
Buy, Sell or Hold: Buying Into Brazil by Betting on Vale (NYSE: VALE)
On Oct. 27, 2008, I strongly recommended that Money Morning readers invest in the Brazilian stock market through the iShares MSCI Brazil Index Fund (NYSE: EWZ).
It was a momentous decision. The U.S. economy and the global financial system seemed to be coming to a precipitous end.
The day before Money Morning published my lengthy analysis and recommendation, The New York Times published an editorial by the newly anointed economics Nobel laureate Paul Krugman, entitled "The Widening Gyre." Krugman in that editorial criticized those of us who believed emerging economies would decouple from the financial melee that was wrought by the over-leveraged and imbalanced developed economies.
"The really shocking thing, however, is the way the crisis is spreading to emerging markets - countries like Russia, Korea and Brazil," he wrote. And he derided the notion of "the supposed ability of emerging market economies to keep growing even if the United States fell into recession.... Now the emerging markets are in big trouble."
It was a momentous decision. The U.S. economy and the global financial system seemed to be coming to a precipitous end.
The day before Money Morning published my lengthy analysis and recommendation, The New York Times published an editorial by the newly anointed economics Nobel laureate Paul Krugman, entitled "The Widening Gyre." Krugman in that editorial criticized those of us who believed emerging economies would decouple from the financial melee that was wrought by the over-leveraged and imbalanced developed economies.
"The really shocking thing, however, is the way the crisis is spreading to emerging markets - countries like Russia, Korea and Brazil," he wrote. And he derided the notion of "the supposed ability of emerging market economies to keep growing even if the United States fell into recession.... Now the emerging markets are in big trouble."
Buy, Sell or Hold: McDonald's Corp. (NYSE: MCD) Is Undervalued and Offers Exceptional Upside
I first recommended McDonald's Corp. (NYSE: MCD) to Money Morning readers on Feb. 23, 2009. A few weeks later the stock bottomed out at $50.44. It then took the turn that we expected and went on to rally some 28%, achieving a 52-week high of $64.78 by the end of the year. The stock is now consolidating at these levels, and, from a technical standpoint it appears to be forming a cup-and-handle pattern.
This is important because this type of pattern often leads to explosive breakouts once the resistance level is breached. And while we wait for this to occur, we have the luxury of sitting on a 3.23% dividend yield, which is very safe given McDonald's very solid balance sheet.
I am confident that the only downside scenario to this investment would be to see the stock move within its well-established trading range for a little while longer. In times of economic and political uncertainty, this stock is a desirable one to hold as a core portfolio position.
This is important because this type of pattern often leads to explosive breakouts once the resistance level is breached. And while we wait for this to occur, we have the luxury of sitting on a 3.23% dividend yield, which is very safe given McDonald's very solid balance sheet.
I am confident that the only downside scenario to this investment would be to see the stock move within its well-established trading range for a little while longer. In times of economic and political uncertainty, this stock is a desirable one to hold as a core portfolio position.
Buy, Sell or Hold: General Mills Stock Has Shown Its Short-Term Value and Is Still a Long-Term Winner
On May 26, 2009, I recommended buying shares of General Mills Inc. (NYSE: GIS) stock. Investors who took my advice then would have paid about $52.61 for the stock, which is currently trading at $70.96 a share, resulting in a gain of about 35%.
The stock at the time had been neglected and offered a very compelling risk-reward situation, especially considering the market conditions. But the market often takes some time to recognize tremendous opportunities that to others seem obvious.
That was the case with General Mills, which has been successful for decades. Strong execution and a strong product lineup in a stable business have led to sustained capital formation that weathered the debacle of 2008 relatively well. The 30% drop the stock suffered turned out to be a gift for investors, as it has completely reversed course.
In fact, GIS earlier this month hit a fresh all time high of $72.25. The question now is: Can General Mills keep it up?
The stock at the time had been neglected and offered a very compelling risk-reward situation, especially considering the market conditions. But the market often takes some time to recognize tremendous opportunities that to others seem obvious.
That was the case with General Mills, which has been successful for decades. Strong execution and a strong product lineup in a stable business have led to sustained capital formation that weathered the debacle of 2008 relatively well. The 30% drop the stock suffered turned out to be a gift for investors, as it has completely reversed course.
In fact, GIS earlier this month hit a fresh all time high of $72.25. The question now is: Can General Mills keep it up?
Buy, Sell or Hold: Ford Motor Co.'s (NYSE: F) Turnaround Could Put Investors on the Fast Track to Profit
Back on July 28, 2008, I recommended buying a speculative stake in Ford Motor Co. (NYSE: F). The stock has more than doubled in value since then, and I believe it's positioned for even more gains.
Let me tell you why.
Investing in a company as it turns around from a highly distressed situation is one of the most profitable investments one can make.
Many billionaires, like Wilbur Ross and David Tepper of Appaloosa Management LP, are masters of this style of investing. And they have the profits to prove it.
That's why I am always looking for these rare situations, which can play a very important role in a portfolio, even with a small initial investment. And right now there are a few very strong signals that the U.S. auto sector, which was demolished by the financial crisis, is going to bounce back stronger than ever.
Let me tell you why.
Investing in a company as it turns around from a highly distressed situation is one of the most profitable investments one can make.
Many billionaires, like Wilbur Ross and David Tepper of Appaloosa Management LP, are masters of this style of investing. And they have the profits to prove it.
That's why I am always looking for these rare situations, which can play a very important role in a portfolio, even with a small initial investment. And right now there are a few very strong signals that the U.S. auto sector, which was demolished by the financial crisis, is going to bounce back stronger than ever.
Buy, Sell or Hold: Google Inc. Sure to Surprise After Adapting to New Technology
When Google Inc. (Nasdaq: GOOG) reports its fourth-quarter and full-year earnings on Jan. 21, the Internet search giant is poised to once again surprise Wall Street by beating expectations and reporting an increase in market share.
It is awe-inspiring to think about what Google is and what it has accomplished in such a short period of time. Just this week, German Justice Minister Sabine Leutheusser-Schnarrenberger told the weekly magazine Der Spiegel that Google has already become a "giant monopoly" like Microsoft Corp. (Nasdaq: MSFT).
Google invented the very best search engine and now it is reaping the benefits.
It is awe-inspiring to think about what Google is and what it has accomplished in such a short period of time. Just this week, German Justice Minister Sabine Leutheusser-Schnarrenberger told the weekly magazine Der Spiegel that Google has already become a "giant monopoly" like Microsoft Corp. (Nasdaq: MSFT).
Google invented the very best search engine and now it is reaping the benefits.
Buy Sell or Hold: The SPDR Gold Trust ETF Will Rally in 2010, as Recent Dollar Strengthening Loses Steam
Gold prices surged to a record high $1226.10 an ounce on Dec. 3, but have since retreated. Meanwhile, the U.S. dollar has been weak for many months, but shown signs of strength in the past week.
So what's next for the dollar and the price of commodities like gold?
In order to answer that question we must look at the factors that brought us here: loose monetary policy and government stimulus.
So what's next for the dollar and the price of commodities like gold?
In order to answer that question we must look at the factors that brought us here: loose monetary policy and government stimulus.
Buy, Sell or Hold: Johnson & Johnson (NYSE: JNJ) Brings a Strong Business Model and 100 Years of Experience Into 2010
I know Johnson & Johnson (NYSE: JNJ) very well. I live in the heart of big pharma country: Princeton, N.J. And I have been interacting regularly with many people in this industry, including all levels of the Johnson & Johnson management for years.
Johnson & Johnson is a company that my peer analysts and I have admired for decades. And this well-deserved admiration goes well beyond the financial community.
Let me tell you why.
JNJ has a sound business model that emphasizes the development and marketing of top quality drugs and benchmark consumer products. Its strong and stable profit margins - with gross profit north of 70% – and its consistent growth over more than a century are matched by only a handful of companies.
Johnson & Johnson is a company that my peer analysts and I have admired for decades. And this well-deserved admiration goes well beyond the financial community.
Let me tell you why.
JNJ has a sound business model that emphasizes the development and marketing of top quality drugs and benchmark consumer products. Its strong and stable profit margins - with gross profit north of 70% – and its consistent growth over more than a century are matched by only a handful of companies.
Buy, Sell or Hold: Microsoft Corp. (Nasdaq: MSFT) Is Winning the Race for Cloud-Computing Dominance
Microsoft Corp. (Nasdaq: MSFT) reported a strong quarter at the end of October on the back of resurgent demand in the PC market. But the key issue to watch is the important transition in the company’s major technologies.
Microsoft just launched its very successful Windows 7 operating system, which has produced a major new upgrade cycle in the industry. In England, for example, Amazon.com Inc. (Nasdaq: AMZN) had more success selling Windows 7 packages than it did Harry Potter books. Windows 7 has major advantages over Vista, including speed, simplicity and booting time. This is prompting Vista users, as well as those who skipped Vista, to upgrade.