This Stock Could Feed Profits Into Your Portfolio

Daniel Cross - Contributor - Equities

Long-term value investors understand that truly profitable trends can take time to build up. Stock market sectors wax and wane with the economy and flow along the curvature of the business cycle, but others don't necessarily obey the same rules.

There's an old saying by Mark Twain, “buy land – it's the one thing they’re not making any more of.” Value investors can take it one step further, though. Arable land is limited, and the global population is growing. That makes food production a critical industry that will continue to be relevant regardless of economic direction.

Low oil prices translate into higher consumer spending which benefits food production companies as well. As a defensive non-cyclical industry, demand stays relatively constant regardless of how the economy is performing.

A rising tide lifts all boats, and the food industry is getting quite a lift lately. Several companies have raised guidance for the next quarter, and a number of analysts have upgraded the industry's outlook going forward. Continue reading "This Stock Could Feed Profits Into Your Portfolio"

A Value Stock That's Out Of This World

Daniel Cross - Contributor - Equities

Value investors know that the long game is important when picking a stock. Short term gains fluctuate, but solid fundamentals mean that a company will outperform over the long-term regardless of temporary ups and downs in the market.

A few decades ago the field of technology was in its infancy and the computer space was considered highly risky and volatile. Of course, anyone who bought into companies like Apple or Intel back then are certainly reaping the rewards today.

Technology is still an investor's best bet for finding the next breakout industry. Right now IoT (Internet of Things) is the frontrunner with advances being made in data storage, infrastructure, and other forms of "smart" tech. Big data stocks and chipmakers have already seen big gains in the past couple of years and should continue to thrive. But there's another industry that looks very much like computers did back in the late 70's and early 80's – spaceflight.

The introduction of commercial space agencies is brand new. Richard Branson helped kick off the new space race with his Virgin Galactic company and now Elon Musk and Jeff Bezos have joined in with their SpaceX and Blue Horizons companies.

While still privately owned entities, there are still ways for investors to hop aboard this exciting new enterprise. Satellite telecommunications hasn't been an industry in focus for Wall Street analysts, but rapidly growing interest in spaceflight and space-related technology means that these companies may be about to enter a new bullish environment that could last decades. Continue reading "A Value Stock That's Out Of This World"

Investors Should Watch Out For This Breakout Stock

Daniel Cross - Contributor - Equities

If you're an advocate of EMH (Efficient Market Hypothesis), then you likely assume that markets are rational and bargain pickups are hard to come by. Stocks that take off without notice shouldn't happen since investors, whether institutional or everyday, have access to the same information. However, there are some cases that simply defy the rules.

Stealthy stocks that are relatively unknown can surprise investors. These types of companies might have few or no analysts covering its stock letting it easily slip through investors sights. But once it starts hitting new highs, it makes waves.

Many have immortalized investors like Benjamin Graham and Warren Buffett. The value investor style of stock trading has been a winner for decades, but a look back at recent history tells a different story. It's growth stocks that have outperformed value stocks over the past decade. Advances in technology and a the globalization of the world's financial markets have led to an aggressive bull market that undervalued stocks just haven't been able to keep up with. Continue reading "Investors Should Watch Out For This Breakout Stock"

This Company Is Making Moves That Investors Might Want To Pay Attention To

Daniel Cross - Contributor - Equities

Companies aren't static entities that hit maturity and simply stop growing. No successful business model calls for a reduction in innovation or a strategy that consists of “just keep doing what we're doing.” Great companies find ways to keep growing and keep building. They challenge themselves to develop new products or services and are never satisfied with the status quo.

Merger and acquisition activity is back on Wall Street – a good sign that the bull is coming back. Companies that are looking to expand look to M&A's as a long play for success. The initial cost can often have a short term temporary negative impact on earnings, but once its complete and overlaps are eliminated, the company can greatly increase its profits.

Some sectors are known for more of this kind of activity than others like technology and healthcare. These industries change so rapidly that a constant turnover is just part of the business model. But when sectors like industrials or retailers start to see that kind of activity, it's a sign that those companies see opportunities for growth on the horizon. Continue reading "This Company Is Making Moves That Investors Might Want To Pay Attention To"

Follow The Transportation Sector To Profits

Daniel Cross - Contributor - Equities

Certain sectors of the economy have predictive qualities. Known as leading indicators, changes in these industries tell investors whether the economy is expanding or contracting before more solid data comes out.

Transportation is one of those sectors that tells investors how healthy the economy is. When transportation companies are doing poorly and missing earnings, it's often a sign that the economy isn't doing well. On the other hand, when profits are up it can mean that businesses are shipping and manufacturing more goods that need to be delivered.

After a rough start to the year, the transportation sector has rebounded strongly. Just tracking the SPDR S&P Transportation ETF (PACF:XTN) since it dipped in January shows an improvement of 17% to date. Hedge funds have also been expressing an interest in transportation stocks lately with large purchases in a number of trucking companies. Continue reading "Follow The Transportation Sector To Profits"