Occasionally, I give Wall Street analysts a tough time. They tend to have a herd mentality, are myopically focused on the short-term, and are reluctant to downgrade stocks until trouble goes from bad to worse and the damage has already been done. That’s a bit like yanking a tiring pitcher after he’s surrendered a big home run. #-ad_banner-#But I never question the intelligence of these professionals, or their knowledge of the industries they cover. Spending all day, every day, analyzing one specific group (whether its airlines, utilities or biotechnology) affords a deep understanding of those businesses and their operating environments. Read More

Occasionally, I give Wall Street analysts a tough time. They tend to have a herd mentality, are myopically focused on the short-term, and are reluctant to downgrade stocks until trouble goes from bad to worse and the damage has already been done. That’s a bit like yanking a tiring pitcher after he’s surrendered a big home run. #-ad_banner-#But I never question the intelligence of these professionals, or their knowledge of the industries they cover. Spending all day, every day, analyzing one specific group (whether its airlines, utilities or biotechnology) affords a deep understanding of those businesses and their operating environments. I might not always agree with their conclusions, but if an analyst says a retailer’s debt maturities look problematic or a manufacturer might benefit from favorable foreign currency translation, I value their insight and opinion. They know who is gaining market share, where regulatory changes are headed and when disruptive new products will be released. They also know how stock prices behave. So, I find their target prices informative.  Take wireless tower owner Crown Castle (NYSE: CCI), a former holding in my premium newsletter, High-Yield Investing. In late December, with shares trading near the $100 mark, analysts had a consensus… Read More

After a dismal fourth quarter, disheartened investors needed a snap-back rally… and they got it in spades: The S&P 500 rallied 15% from the market’s lows on December 24 through the end of January.  That’s 15% in six weeks. I think it would be fair to say that this is a far better result that many investors had expected. While the rally still wasn’t enough to recover all of 2018’s losses — the S&P 500 now trades just about 2% above its levels of the start of 2018 — this is truly a great showing. January’s rally alone was one… Read More

After a dismal fourth quarter, disheartened investors needed a snap-back rally… and they got it in spades: The S&P 500 rallied 15% from the market’s lows on December 24 through the end of January.  That’s 15% in six weeks. I think it would be fair to say that this is a far better result that many investors had expected. While the rally still wasn’t enough to recover all of 2018’s losses — the S&P 500 now trades just about 2% above its levels of the start of 2018 — this is truly a great showing. January’s rally alone was one for the record books. It was the index’s best single-month performance since October 2015 and the best start of the year since January 1987. But was the snap-back enough to restore investors’ trust in the market? —Recommended Link— URGENT NEWS: Experts Warn Your Pension Is “A Disaster Waiting to Happen” Save your retirement from miserly interest rates and an overstretched stock market with our special “Executive Dividends” Program… Learn more inside.. It should be. In fact, a rational investor shouldn’t have lost faith in the market to begin with. Especially if he or she has a strong-enough plan (like… Read More

Not many asset classes finished 2018 on a high note. But the December pullback was particularly harsh for high-yield bonds. In fact, the group suffered its worst monthly performance in eight years.  Like most in this category, the SPDR High Yield Bond (NYSE: JNK) fund ended 2018 in negative territory with a loss of 3.3%. Despite being riskier than their investment-grade counterparts, annual declines are rare for high-yield bonds.  #-ad_banner-#In fact, it has only happened a handful of times over the past 20 years.  And they don’t stay down for long. According to State Street, high-yield bonds have rebounded 29%… Read More

Not many asset classes finished 2018 on a high note. But the December pullback was particularly harsh for high-yield bonds. In fact, the group suffered its worst monthly performance in eight years.  Like most in this category, the SPDR High Yield Bond (NYSE: JNK) fund ended 2018 in negative territory with a loss of 3.3%. Despite being riskier than their investment-grade counterparts, annual declines are rare for high-yield bonds.  #-ad_banner-#In fact, it has only happened a handful of times over the past 20 years.  And they don’t stay down for long. According to State Street, high-yield bonds have rebounded 29% on average in the calendar year following an annual decline. While I wouldn’t bank on that large of a gain, I do believe this same pattern will hold in 2019.  As you may know, this group isn’t particularly rate-sensitive. Like equities, it responds more to broad economic changes, which in turn influence the ability of corporate borrowers to repay their IOUs. Right now, most are meeting principal and interest payments in a timely manner.  According to Moody’s, default rates on speculative-grade U.S. debt are projected to fall from 3.0% currently (already well below historical norms) to just 2.0% by September. Read More

Since 1951, the American Cancer Society has been releasing a detailed report on the status of this dreaded disease, and our progress in fighting it.  A valuable feature of these publications is their projections of the number of cancer cases and deaths expected in the country as a whole and in each state, broken down by specific types of cancer. Most recently, for instance, we learned that the recent trend of the decline in mortality rates — a decline that began in 1991 — has continued. As of 2015, the latest year for which figures are available, the mortality rate… Read More

Since 1951, the American Cancer Society has been releasing a detailed report on the status of this dreaded disease, and our progress in fighting it.  A valuable feature of these publications is their projections of the number of cancer cases and deaths expected in the country as a whole and in each state, broken down by specific types of cancer. Most recently, for instance, we learned that the recent trend of the decline in mortality rates — a decline that began in 1991 — has continued. As of 2015, the latest year for which figures are available, the mortality rate dropped to 159 per 100,000 (a decline of 26% since 1991); this translates into 2.3 million-plus fewer cancer deaths over this period. The death rate has declined especially sharply for the four most common cancer types: lung, colorectal, breast, and prostate. This is wonderful news, and there are two big reasons for this progress.  #-ad_banner-#One is related to public-health efforts, in particular the reduction in smoking. In 1991, about 46.3 million adults in the United States (25.7%) smoked cigarettes; by 2016, this number declined to 15.5% of all adults (37.8 million people).  The other has everything to do with science… Read More

Lately, I’ve been noting the importance of the 200-day moving average (MA). The first chart I want to look at this week shows that the S&P 500 failed to break above that MA.  I’ve also highlighted another section of the chart that is a good illustration of how important the 200-day MA can be. During that period, the index reached its top in October and began selling off. The initial declined when the price broke below the 200-day MA.  For almost eight weeks, the S&P 500 remained within a few percentage points of this level. Then, in early December, the… Read More

Lately, I’ve been noting the importance of the 200-day moving average (MA). The first chart I want to look at this week shows that the S&P 500 failed to break above that MA.  I’ve also highlighted another section of the chart that is a good illustration of how important the 200-day MA can be. During that period, the index reached its top in October and began selling off. The initial declined when the price broke below the 200-day MA.  For almost eight weeks, the S&P 500 remained within a few percentage points of this level. Then, in early December, the index broke sharply below its moving average, sparking a 15% tumble that reached a low of 2,351 on December 24.  In the six weeks since those lows, the S&P 500 staged a steady rally back toward its 200-day MA (spurring an increase of bullish opinions)… but it stalled out last week after failing to break through the MA for two days.  —Recommended Link— Thousands Of Americans Have Joined A Revolutionary New Marijuana Profit-Sharing Plan. Their payouts have been breathtaking. The company behind this plan sends out profit-sharing checks like clockwork, and you could quickly find… Read More