The recovery in U.S. housing has been the pervasive theme since the financial collapse and has offered some of the best returns in the market. Extreme uncertainty over subprime loans and falling real estate prices drove homebuilders and building products to fire-sale prices by 2011. Hindsight, curse that it is, has most of us looking back at the triple-digit gains in some housing-related companies over the two years to mid-2013 and wondering why we couldn’t see the writing on the wall. #-ad_banner-#But you shouldn’t beat yourself up too badly — you just might get another chance. The SPDR S&P Homebuilders… Read More

The recovery in U.S. housing has been the pervasive theme since the financial collapse and has offered some of the best returns in the market. Extreme uncertainty over subprime loans and falling real estate prices drove homebuilders and building products to fire-sale prices by 2011. Hindsight, curse that it is, has most of us looking back at the triple-digit gains in some housing-related companies over the two years to mid-2013 and wondering why we couldn’t see the writing on the wall. #-ad_banner-#But you shouldn’t beat yourself up too badly — you just might get another chance. The SPDR S&P Homebuilders Index Fund (NYSE: XHB) has underperformed the market with a gain of just 11% over the last year and a loss of 1% over the past six months. The weakness is in stark contrast to the 60% gain the index posted in the two years to mid-2013, along with triple-digit gains in shares of homebuilders like KB Homes (NYSE: KBH) and Hovanian Enterprises (NYSE: HOV). Weakness in housing-related stocks follows abysmal housing data over the last six months of 2013 and the first quarter of this year. Against winter weakness and the disappointing spring selling season comes strong evidence of… Read More

After a prolonged worldwide economic slump, we’re finally seeing some consistent growth. #-ad_banner-#Growth in corporate sales and earnings, and in U.S. stock market averages, is on an undeniable upward trend. The benchmark S&P, Dow and Nasdaq indices all broke out of trading ranges during the past six weeks and are reaching annual highs. Yet this growth isn’t happening rapidly — and that’s good news for investors, because rapid upward swings in the stock market often lead to rapid market corrections.  Instead, the market’s made slow progress this year, going through a couple of corrections in February and April, then… Read More

After a prolonged worldwide economic slump, we’re finally seeing some consistent growth. #-ad_banner-#Growth in corporate sales and earnings, and in U.S. stock market averages, is on an undeniable upward trend. The benchmark S&P, Dow and Nasdaq indices all broke out of trading ranges during the past six weeks and are reaching annual highs. Yet this growth isn’t happening rapidly — and that’s good news for investors, because rapid upward swings in the stock market often lead to rapid market corrections.  Instead, the market’s made slow progress this year, going through a couple of corrections in February and April, then trading sideways in apparent preparation for the current upward move. One of the market sectors heading upward is specialty metals — and in that sector, I love Allegheny Technologies (NYSE: ATI), an undervalued gem (and one that I happen to hold in a personal model portfolio comprising what I think are this year’s best stocks for growth and income). Allegheny is a global leader in specialty metals and components. Its products include titanium and nickel alloys and a variety of steel products and other metals. The aerospace and defense industries make up Allegheny’s biggest customer base,… Read More

Although many well-known stocks have been generating fantastic returns, a lot of money has also been made in the last places you might expect… Like kitchen appliances, for instance. I mean, who’d ever think they could still propel a company’s stock to massive gains? #-ad_banner-#Well, they sure have for one obscure mid-cap company that’s actually a leading manufacturer of ovens, ranges and other cooking equipment for commercial and residential use. The company’s stock is up more than 800% in the past 10 years, so you’d think it would be all over the financial news. But it’s… Read More

Although many well-known stocks have been generating fantastic returns, a lot of money has also been made in the last places you might expect… Like kitchen appliances, for instance. I mean, who’d ever think they could still propel a company’s stock to massive gains? #-ad_banner-#Well, they sure have for one obscure mid-cap company that’s actually a leading manufacturer of ovens, ranges and other cooking equipment for commercial and residential use. The company’s stock is up more than 800% in the past 10 years, so you’d think it would be all over the financial news. But it’s not one you really hear much about, and even some top mutual funds haven’t paid it much mind. For instance, it’s nowhere to be found in the top 10 holdings list of Neuberger Berman Genesis (Nasdaq: NBGNX), a famous small- and mid-cap equity fund that’s beaten the market handily over the years (including expenses and fees). In fact, the stock is only #38 in NBGNX’s 100-holding, $14.7 billion portfolio. And its overall weighting of barely 1% is far too small to have much of an effect on fund performance. Now, I certainly don’t mean to knock Neuberger Berman Genesis. It’s… Read More

Investors saw some bullish fireworks as the Dow exploded past 17,000 for the first time last week just before they checked out to celebrate the Fourth of July. #-ad_banner-#The breaching of this psychologically significant threshold is quite a feat for a market that just five years ago was knocked silly by the worst economic downturn since the Great Depression. In fact, the Dow closed at 8,280.74 before Independence Day in 2009. That means that the Dow has more than doubled in five years. So far in 2014, the bull market has not only been in stocks, it’s also been in… Read More

Investors saw some bullish fireworks as the Dow exploded past 17,000 for the first time last week just before they checked out to celebrate the Fourth of July. #-ad_banner-#The breaching of this psychologically significant threshold is quite a feat for a market that just five years ago was knocked silly by the worst economic downturn since the Great Depression. In fact, the Dow closed at 8,280.74 before Independence Day in 2009. That means that the Dow has more than doubled in five years. So far in 2014, the bull market has not only been in stocks, it’s also been in bonds and commodities. This is an unusual situation, because usually when stock prices rise, bond prices falter, and/or commodity prices fall. Sure, stocks, bonds and commodities can move up together for short periods of time, but through the first half of 2014, all three asset classes are higher, which hasn’t occurred since 1993. In the first six months of 2014, the S&P 500 index rose 6.1%. Commodities, as measured by the PowerShares DB Commodity Index Tracking (NYSE: DBC), saw a year-to-date gain of 3.4%. And bonds, as measured by the iShares 20+ Year Treasury Bond (NYSE: TLT), spiked 11.5%.  The… Read More

Steady, reliable growth — that’s what characterizes America’s biggest garbage collection and disposal company, Waste Management (NYSE: WM).  #-ad_banner-#Over the past five years, revenue has steadily risen, hitting $14 billion in 2013. During this same period, the annual dividend increased 29%, going from $1.16 to $1.50 per share, while shares rose more than 65%. What captures my attention right now is that technically the stock has broken out of a cup-and-handle pattern and is edging toward key resistance at $45. If WM breaks through this key resistance level, shares should quickly run to $50. This… Read More

Steady, reliable growth — that’s what characterizes America’s biggest garbage collection and disposal company, Waste Management (NYSE: WM).  #-ad_banner-#Over the past five years, revenue has steadily risen, hitting $14 billion in 2013. During this same period, the annual dividend increased 29%, going from $1.16 to $1.50 per share, while shares rose more than 65%. What captures my attention right now is that technically the stock has broken out of a cup-and-handle pattern and is edging toward key resistance at $45. If WM breaks through this key resistance level, shares should quickly run to $50. This consistent growth has caught the attention of Bill Gates. According to Nasdaq’s ownership summary, the Bill & Melinda Gates Foundation Trust is one of the top five holders of WM, with 18.6 million shares — a 4% stake in the company. As my colleague Marshall Hargrave said in his recent article on the company, “One of the richest men in the world is finding value in one of the dirtiest industries in the world.” But while WM is known for turning trash into cash, it’s the company’s innovation in green technology that is moving revenue forward. In 2013, Waste Management… Read More

The impressive early gains for camera maker GoPro (Nasdaq: GPRO) didn’t come in a vacuum. The company’s IPO was launched in the midst of a veritable frenzy of new issues.  #-ad_banner-#In just the past few weeks, a wide variety of companies have come public, and plans are in place to maintain the frenzied pace throughout July as well. Anytime you see such a large group of new IPOs in a short period of time, a trading opportunity invariably emerges: The stocks start trading, often shoot higher, and then momentum investors start to lose interest, leading shares to drift lower.  That’s where… Read More

The impressive early gains for camera maker GoPro (Nasdaq: GPRO) didn’t come in a vacuum. The company’s IPO was launched in the midst of a veritable frenzy of new issues.  #-ad_banner-#In just the past few weeks, a wide variety of companies have come public, and plans are in place to maintain the frenzied pace throughout July as well. Anytime you see such a large group of new IPOs in a short period of time, a trading opportunity invariably emerges: The stocks start trading, often shoot higher, and then momentum investors start to lose interest, leading shares to drift lower.  That’s where Wall Street analysts come in. If they are affiliated with the firm that underwrote the IPO, then these analysts can issue their new research coverage on these firms after an appropriate waiting period (25 calendar days after the IPO for companies with less than $1 billion in revenue and 40 days for larger firms).  Such research often gives new stocks a boost (known as the “quiet period bounce”) because the analysts’ target prices are often higher than the current trading price. Of course, any IPO that has already sharply surged in price may not see such a bounce. GoPro is… Read More

Whatever your take on health care in America, one thing’s for sure: The U.S. health care system creates a lot of waste — millions of tons each year of the nastiest stuff you can imagine.  #-ad_banner-#Soiled wound dressings and surgical gloves, used syringes, discarded surgical instruments… even human tissue left over from surgery. The same goes for plenty of other countries, too. Sounds like just the investment opportunity you were looking for, right? Well, it actually could be. Somebody’s got to collect, treat, and properly dispose of all that odious and potentially hazardous medical waste — and there’s… Read More

Whatever your take on health care in America, one thing’s for sure: The U.S. health care system creates a lot of waste — millions of tons each year of the nastiest stuff you can imagine.  #-ad_banner-#Soiled wound dressings and surgical gloves, used syringes, discarded surgical instruments… even human tissue left over from surgery. The same goes for plenty of other countries, too. Sounds like just the investment opportunity you were looking for, right? Well, it actually could be. Somebody’s got to collect, treat, and properly dispose of all that odious and potentially hazardous medical waste — and there’s a whole industry devoted to that. The nice thing is you don’t have to research a bunch of different medical waste management firms just to pick the one or two you think are worth your investment dollars. In the decidedly unappealing world of medical waste, there’s one undisputed champ. This firm’s stock has at least 70% upside and is a good bet to beat the market in coming years, in my opinion. It certainly has a history of market trouncing, delivering more than 27% a year for the past 15 years, compared with a 4.4% rate of return for the… Read More

When the Federal Reserve first suggested a gradual tightening of its monetary policy in May 2013, investors began to wonder if the long-running bull market would come to an abrupt end.  #-ad_banner-#A quick spike in interest rates at the time gave a sense that times were indeed changing. Yet investors end up shrugging off that noise: The S&P 500 rose an impressive 22% between July 1 of last year and June 30 of this year. Toss in dividends and investors garnered a 25% total return — roughly the amount investors should expect to garner over a three year period in… Read More

When the Federal Reserve first suggested a gradual tightening of its monetary policy in May 2013, investors began to wonder if the long-running bull market would come to an abrupt end.  #-ad_banner-#A quick spike in interest rates at the time gave a sense that times were indeed changing. Yet investors end up shrugging off that noise: The S&P 500 rose an impressive 22% between July 1 of last year and June 30 of this year. Toss in dividends and investors garnered a 25% total return — roughly the amount investors should expect to garner over a three year period in normal times. But these are not normal times. The stunning 191% gain for the S&P 500 since bottoming out in March 2009 is remarkable in light of the fact that the subsequent economic rebound after the Great Recession has been quite tepid. Low interest rates, a huge amount of global liquidity and very high corporate profit margins all get credit for the bull market that has exceeded the wildest expectations of even the most aggressive market strategists. At this point, it might seem the wisest path to sit back and enjoy the ride, waiting for another 20% gain over the… Read More

When Nick Woodman, founder and CEO of GoPro (Nasdaq: GPRO), appeared on “60 Minutes” last November, his company’s fate was sealed.  #-ad_banner-#​That segment showed a variety of amazing feats you could accomplish with the company’s ruggedized, miniaturized wearable digital camcorders — and it led to a huge spike in orders for the company. That led Woodman to realize that the buzz around the company was so loud that it was time to start preparing for an initial public offering (IPO). Fast forward to June 26,… Read More

When Nick Woodman, founder and CEO of GoPro (Nasdaq: GPRO), appeared on “60 Minutes” last November, his company’s fate was sealed.  #-ad_banner-#​That segment showed a variety of amazing feats you could accomplish with the company’s ruggedized, miniaturized wearable digital camcorders — and it led to a huge spike in orders for the company. That led Woodman to realize that the buzz around the company was so loud that it was time to start preparing for an initial public offering (IPO). Fast forward to June 26, 2014, and GoPro’s public debut has marked the company as one of the hottest — and perhaps most controversial — new issues on the market. How hot is this stock? Priced at $24 a share, GPRO opened at $28.65 and is already up in the low $40s (though below its $49.90 peak). For investors looking for a piece of the action, a classic conundrum has emerged: Do you buy the hot IPO in expectation of robust price appreciation in the years ahead as sales grow — or do you hold off and wait for the air to come out of… Read More

If the stock market held the Golden Raspberry award (given to the worst movie of the year), then Higher One Holdings (NYSE: ONE) would win the prize.  #-ad_banner-#The provider of financial services and other products to college campuses saw its shares plunge 62% in the first half of 2014, the worst performance of any stock in the S&P 400, 500 or 600. Higher One has dubious company: Of the 1,500 companies in those three indices, 47 have fallen at least 25% since the year began.  As we pass the midpoint of the year, it helps to scour this group of… Read More

If the stock market held the Golden Raspberry award (given to the worst movie of the year), then Higher One Holdings (NYSE: ONE) would win the prize.  #-ad_banner-#The provider of financial services and other products to college campuses saw its shares plunge 62% in the first half of 2014, the worst performance of any stock in the S&P 400, 500 or 600. Higher One has dubious company: Of the 1,500 companies in those three indices, 47 have fallen at least 25% since the year began.  As we pass the midpoint of the year, it helps to scour this group of broken stocks. Though many of them have intractable problems that will take a while to fix, some of them have the ingredients for an impressive snapback rally. This is a good time to start researching rebound candidates, but it’s not yet time to buy them. Instead, follow the “10% rule,” which is a phrase coined by my colleague Bob Bogda. The best time to buy these stocks is when they have begun to move higher again, as I discussed in late June. Here are three stock in the group of losers that I am tracking. When they start to trade… Read More