It could be argued that Americans have long believed “we are what we own” — the bigger, the better; the more, the merrier. Some folks shell out a lot of money to have three or four cars sitting in the driveway, or vacation homes on both coasts. Often times, the cars sit idle and the homes empty for a good portion of the time. However, a monumental economic shift is underway and changing the face of consumerism as we know it. We can now reap the benefits of consumption without the costs of ownership. In fact, those unused… Read More

It could be argued that Americans have long believed “we are what we own” — the bigger, the better; the more, the merrier. Some folks shell out a lot of money to have three or four cars sitting in the driveway, or vacation homes on both coasts. Often times, the cars sit idle and the homes empty for a good portion of the time. However, a monumental economic shift is underway and changing the face of consumerism as we know it. We can now reap the benefits of consumption without the costs of ownership. In fact, those unused or rarely used items just taking up space in your life can begin to fill up your wallet.  This relatively new phenomenon is called consumer-to-consumer sharing. Owners rent out something they are not using — such as a car, a house, tools or a bicycle — using online peer-to-peer services. The go-between company typically has an eBay- or Yelp-style rating system so people on both sides of the transaction can trust each other.  The concept has taken on a life of its own. Forbes estimates that revenue flowing through the “share economy” directly into people’s bank accounts will surpass $3.5… Read More

Nick Dreystadt is an unsung hero of American business. In 1933, the engineer knocked on the boardroom door at General Motors (NYSE: GM) and asked to be heard for ten minutes. He said he could take GM’s most problematic division and make it profitable within 18 months. It was a bold move. The historian John Steele Gordon said Dreystadt’s intrusion into the exclusive confines of the boardroom was roughly akin to a lowly priest knocking on the door of the Sistine chapel to advise the cardinals while electing a pope. It was also a very bold claim: The GM division… Read More

Nick Dreystadt is an unsung hero of American business. In 1933, the engineer knocked on the boardroom door at General Motors (NYSE: GM) and asked to be heard for ten minutes. He said he could take GM’s most problematic division and make it profitable within 18 months. It was a bold move. The historian John Steele Gordon said Dreystadt’s intrusion into the exclusive confines of the boardroom was roughly akin to a lowly priest knocking on the door of the Sistine chapel to advise the cardinals while electing a pope. It was also a very bold claim: The GM division at issue commanded the highest prices, but it also shouldered the highest costs, and by a wide margin. Then there was the small matter of timing: It was the middle of the Great Depression. But Nick Dreystadt nevertheless thought he could sell Cadillacs. #-ad_banner-#His two-pronged plan was as simple as it was controversial. Dreystadt told the board he would end a longstanding GM policy that barred dealers from selling Cadillacs to African-Americans, thus opening up a huge new market. Affluent blacks, Dreystadt noted, could not move into “rich” neighborhoods. They couldn’t join country clubs. But many professionals could easily afford… Read More

Cellphones are everywhere — and everybody has the same problem…  #-ad_banner-#Getting the battery on their phones to last all day.  Finding a charger that will give you a quick boost is an even bigger problem. And if you’ve ever needed to charge your phone while you’re at an airport, good luck. Outlets at airports have become something of a grail.  But it’s not just about finding an outlet or a charger. It’s often even more important to get your device charged quickly.  One company that has developed a quick charger for the mobile market is little-known Power Integrations… Read More

Cellphones are everywhere — and everybody has the same problem…  #-ad_banner-#Getting the battery on their phones to last all day.  Finding a charger that will give you a quick boost is an even bigger problem. And if you’ve ever needed to charge your phone while you’re at an airport, good luck. Outlets at airports have become something of a grail.  But it’s not just about finding an outlet or a charger. It’s often even more important to get your device charged quickly.  One company that has developed a quick charger for the mobile market is little-known Power Integrations (Nasdaq: POWI).  While it might not be well known, the company has a market cap of just over $2 billion. Shares have also performed quite well over the past year and are up more than 50%. In that time, Power Integrations beat earnings estimates in three of the four quarters. For the full year 2014, earnings per share (EPS) are expected to come in at $2.72, which would be year-over-year growth of 10.5%.  To capture the market opportunity in cellphone charging, Power Integrations is teaming up with Qualcomm (Nasdaq:… Read More

In his book “One Up On Wall Street,” Peter Lynch said that he loved “boring” stocks because they were often overlooked by the excitement-seeking crowd. And it doesn’t get much more boring than today’s pick. #-ad_banner-#The company is a leading and highly profitable producer of fluid motion and control products in over 50 countries. It produces pumps, seals and valves for the oil and gas, chemical, water and power industries. Nothing exciting there, but both the technicals and fundamentals say the stock is an excellent trading opportunity. Flowserve (NYSE: FLS) pumps have some… Read More

In his book “One Up On Wall Street,” Peter Lynch said that he loved “boring” stocks because they were often overlooked by the excitement-seeking crowd. And it doesn’t get much more boring than today’s pick. #-ad_banner-#The company is a leading and highly profitable producer of fluid motion and control products in over 50 countries. It produces pumps, seals and valves for the oil and gas, chemical, water and power industries. Nothing exciting there, but both the technicals and fundamentals say the stock is an excellent trading opportunity. Flowserve (NYSE: FLS) pumps have some high-profile uses, such as making snow for ski hills at the Sochi Olympics. But the company’s bread-and-butter products are monitoring controls, valves and seals used in oil and gas exploration, from the ocean floor to the Canadian oil sands. Making the stock even more likely to fly below the radar is that management has been scaling back operations to sharpen its focus on key revenue-generating segments. In late March, Flowserve announced the divestment of its all-welded ball valve product line, Naval OY. The business was sold to a Finnish valve manufacturer for an undisclosed sum. The company also… Read More

I’ve long been an Apple (Nasdaq: AAPL) bear. But we’re all capable of change.  #-ad_banner-#When AAPL fell more than 40% to just under $400, the forward price-to-earnings (P/E) ratio fell to barely 10 and the dividend grew to just over 3%. The stock suddenly made sense from an investment standpoint, and I began including it in client portfolios.  Similarly, I was the lone Android user in a house full of iPhone users. But when my contract expired a few weeks ago and my carrier offered me a free iPhone 4S, I became an adopter (if not… Read More

I’ve long been an Apple (Nasdaq: AAPL) bear. But we’re all capable of change.  #-ad_banner-#When AAPL fell more than 40% to just under $400, the forward price-to-earnings (P/E) ratio fell to barely 10 and the dividend grew to just over 3%. The stock suddenly made sense from an investment standpoint, and I began including it in client portfolios.  Similarly, I was the lone Android user in a house full of iPhone users. But when my contract expired a few weeks ago and my carrier offered me a free iPhone 4S, I became an adopter (if not a fanboy).  Having used an Android device for a few years, I used Amazon.com’s (Nasdaq: AMZN) cloud music player and built a decent cloud library. When I switched to the iPhone and downloaded the Amazon cloud app, I was immediately bombarded by offers from Amazon to buy MP3 albums from my favorite artists at $5 a pop.  Amazon knew I had switched devices and wanted to keep me from straying to iTunes. So far, I’m still loyal.  But as an investor, I would buy Apple’s stock before Amazon’s. A few numbers explain why.   For the life of me,… Read More

My friend John just quit a 30-year addiction… The first time I met John was at a local poker tournament a few years ago. Of all the times I played with him, he was never once without a cigarette in his hand. So imagine my surprise when I rolled into the game last Friday and saw John sitting at the poker table… his cigarettes nowhere in sight. After 30 years, he had quit cold turkey. I was shocked. When I asked him why he stopped, he pulled out an electronic cigarette (e-cig) and gave it a puff — blowing the… Read More

My friend John just quit a 30-year addiction… The first time I met John was at a local poker tournament a few years ago. Of all the times I played with him, he was never once without a cigarette in his hand. So imagine my surprise when I rolled into the game last Friday and saw John sitting at the poker table… his cigarettes nowhere in sight. After 30 years, he had quit cold turkey. I was shocked. When I asked him why he stopped, he pulled out an electronic cigarette (e-cig) and gave it a puff — blowing the vapor right back into the bar. #-ad_banner-#My friend John isn’t the only former smoker who’s made the switch from traditional cigarettes to their electric counterparts. In Amy Calistri’s March issue of Stock of the Month, she told readers how she herself used the product to quit smoking last December: Last year, I started using an electronic cigarette sold by the tobacco company Lorillard (NYSE: LO). Over time, I went from using cartridges with medium amounts of nicotine (9 to 12 mg) to low amounts of nicotine (6 to 8 mg) to cartridges with no nicotine — basically just flavored… Read More

Although buy-and-hold stock investing has often been harshly criticized since the financial crisis, the backlash has been way overdone.  #-ad_banner-#I firmly believe this time-honored strategy still has plenty of merit — and the long-term record of one mutual fund that’s a perfect example of buy-and-hold conclusively proves this. Take one look at its turnover ratio, and you’ll know why I say this fund is a perfect example of buy-and-hold. The ratio is zero, meaning the fund never sells — ever. If that’s not buy-and-hold, then I don’t know what is. As the following table shows, the fund has… Read More

Although buy-and-hold stock investing has often been harshly criticized since the financial crisis, the backlash has been way overdone.  #-ad_banner-#I firmly believe this time-honored strategy still has plenty of merit — and the long-term record of one mutual fund that’s a perfect example of buy-and-hold conclusively proves this. Take one look at its turnover ratio, and you’ll know why I say this fund is a perfect example of buy-and-hold. The ratio is zero, meaning the fund never sells — ever. If that’s not buy-and-hold, then I don’t know what is. As the following table shows, the fund has more than kept pace with the market and nicely outperformed its peer group (the large value category) in the intermediate term. It has handily beaten the market and its peers in the long term. The fund’s 10-year record places it in the top 1% of the large value category, and its 15-year record is good for the top 10%. Annualized Rate of Return I’m talking about ING Corporate Leaders Trust (Nasdaq: LEXCX), a $1.6 billion fund that most investors probably haven’t heard of. But anyone who considers themselves buy-and-hold investors will want to be familiar with it. Read More

With the albatross of a credit card security breach still hanging around its neck, it is no wonder that retail giant Target (NYSE: TGT) is out of favor on Wall Street.  #-ad_banner-#In just the past week we’ve seen Cowen & Co.’s Consumer Tracking Survey report “meaningful decreases” in customer satisfaction. And Standard & Poor’s lowered the company’s credit rating a notch to A. But the charts tell a different story, and it is a good one.  We can attribute the February rally, following weak fourth-quarter results, to excessive pessimism. The news was bad, but not… Read More

With the albatross of a credit card security breach still hanging around its neck, it is no wonder that retail giant Target (NYSE: TGT) is out of favor on Wall Street.  #-ad_banner-#In just the past week we’ve seen Cowen & Co.’s Consumer Tracking Survey report “meaningful decreases” in customer satisfaction. And Standard & Poor’s lowered the company’s credit rating a notch to A. But the charts tell a different story, and it is a good one.  We can attribute the February rally, following weak fourth-quarter results, to excessive pessimism. The news was bad, but not as bad as expected, and shares soared. And now after a four-week slide, it looks as if TGT is ready to break out again. (My colleague Marshall Hargrave made a similar call in January.) The February rally pushed the stock above the 50-day moving average for the first time since the data breach was reported in December. And the March pullback found support back at the moving average in what chart watchers call a successful test of the initial breakout. Johnny-come-lately bulls had a second chance to buy — and they took it. On-balance volume, which keeps track… Read More

In some respects, this is a golden age for pharmaceuticals. Thousands of medical researchers are making major clinical progress in the fight to treat cancer, heart disease and other afflications.  #-ad_banner-#Yet another group of scientists are working to stop diseases before they emerge: The progress in vaccine research is likely to eventually be seen as one of the key breakthroughs of the early 21st century.  For companies that come up with breakthroughts, the rewards can be huge. Merck’s (NYSE: MRK) Gardisil, which prevents the spread of human papillomavirus (HPV), racked up more than $1 billion in sales last year. Pfizer’s… Read More

In some respects, this is a golden age for pharmaceuticals. Thousands of medical researchers are making major clinical progress in the fight to treat cancer, heart disease and other afflications.  #-ad_banner-#Yet another group of scientists are working to stop diseases before they emerge: The progress in vaccine research is likely to eventually be seen as one of the key breakthroughs of the early 21st century.  For companies that come up with breakthroughts, the rewards can be huge. Merck’s (NYSE: MRK) Gardisil, which prevents the spread of human papillomavirus (HPV), racked up more than $1 billion in sales last year. Pfizer’s (NYSE: PFE) Prevnar 13, which helps prevent invasive pneumococcal disease, is expected to surpass $5 billion in annual sales within a few years.   And that’s just the start. The World Health Organization estimates that the global vaccine market grew from $5 billion in 2000 to $24 billion last year — and could hit $100 billion by 2025. Though vaccines typically sell for a fraction of the cost of biotech drugs, the unit volumes can be tremendous. To be sure, the biggest drug companies, such as Merck and GlaxoSmithKline (NYSE: GSK), are committing… Read More

When it comes to retail stocks, the macro picture covers everything.  Slow consumer sales are restraining growth, and until consumers feel perkier, sector share prices are likely to only slowly merge from their current malaise. Yet in any given year, you can find a handful of retailers that have clear catalysts to deliver robust upside. A pair stands out for the year ahead, as each carries more than 50% potential upside. 1. Destination XL Group (Nasdaq: DXLG ) You may know this company by its former name, Casual Male.  Management decided to change the name a year… Read More

When it comes to retail stocks, the macro picture covers everything.  Slow consumer sales are restraining growth, and until consumers feel perkier, sector share prices are likely to only slowly merge from their current malaise. Yet in any given year, you can find a handful of retailers that have clear catalysts to deliver robust upside. A pair stands out for the year ahead, as each carries more than 50% potential upside. 1. Destination XL Group (Nasdaq: DXLG ) You may know this company by its former name, Casual Male.  Management decided to change the name a year ago to better reflect this retailer’s focus on extra-large men, also known as the “big and tall” crowd. Most retailers carry only a limited assortment of menswear catering to this demographic, making Destination XL the industry’s only pure-play on this niche.  The slow economy over the past five years has surely impacted results for this company. Annual sales, which used to exceed $450 million before the Great Recession, now hover around $400 million. While awaiting a better economy, management has done a great job of managing inventories. Gross margins have risen for five straight years, as this retailer has… Read More