I watch insider transactions closely, following the big selling just as much as the buying. The conventional wisdom is that the actions of these investors can tell you when to buy or sell a company. After all, directors and executive management are ALWAYS trading on insider information. Much of the time, scanning through recent Form 4 statements, the SEC document required when insiders buy or sell shares, is a big yawn. It’s either too small an amount to mean anything to the overall ownership or simply the insider adjusting their total wealth held in the company. But every once in… Read More

I watch insider transactions closely, following the big selling just as much as the buying. The conventional wisdom is that the actions of these investors can tell you when to buy or sell a company. After all, directors and executive management are ALWAYS trading on insider information. Much of the time, scanning through recent Form 4 statements, the SEC document required when insiders buy or sell shares, is a big yawn. It’s either too small an amount to mean anything to the overall ownership or simply the insider adjusting their total wealth held in the company. But every once in a while you come across something that makes you sit straight up: An insider with other intentions. Finding these instances gives investors the chance to piggyback on the insider trades before the market catches on. I think I’ve found one of those trades studying the insider buying from one of Wall Street’s most famous, or infamous, takeover kings. He’s turned his ability to turnaround struggling companies into a $12 billion fortune, making him the 36th richest person in America. Now it looks like he’s focused his aim on a company he’s already tried to buy out before. This Top Director… Read More

You ever wonder why some businesses attract new customers in droves, while others have trouble standing out? It’s the same reason why Starbucks (Nasdaq: SBUX) can charge $7 for a cup of coffee, while the diner across the street only gets $2.  The answer lies in brand loyalty and recognition.  Consumers around the world are comfortably acquainted with certain brand names. And that familiarity has been reinforced by billions in advertising dollars. There is a good reason why Lexus has become synonymous with automotive quality, and why we instinctively grab a 12-pack of Corona beer when heading to the beach. Read More

You ever wonder why some businesses attract new customers in droves, while others have trouble standing out? It’s the same reason why Starbucks (Nasdaq: SBUX) can charge $7 for a cup of coffee, while the diner across the street only gets $2.  The answer lies in brand loyalty and recognition.  Consumers around the world are comfortably acquainted with certain brand names. And that familiarity has been reinforced by billions in advertising dollars. There is a good reason why Lexus has become synonymous with automotive quality, and why we instinctively grab a 12-pack of Corona beer when heading to the beach. The Big Mac isn’t the best hamburger around, yet McDonald’s (NYSE: MCD) still sells them by the truckload each day. The golden arches are instantly recognizable in 119 countries worldwide, delivering annual returns of 13.4% to stockholders over the past decade, nearly double the S&P 500.  Entrenched brands also confer pricing power, allowing their owners to pad profit margins by charging higher prices than competitors for similar products. When you walk into a department store and buy a Ralph Lauren (NYSE: RL) shirt, you pay a little extra for that polo label. Ditto for a Hershey (NYSE: HSY) bar over… Read More

If you’re a growth investor, it’s time to get a lot more boring with your portfolio.   Studies have shown that the real secret to beating the market isn’t growth stocks. Contrary to popular belief, the secret to outsized gains lies in dividends.   The respected research firm Ned Davis conducted a study over more than four decades. Their research found that dividend-paying stocks tend to beat the market over the long term and yield far better returns than stocks that don’t pay dividends.   #-ad_banner-#The Ned Davis study showed that stocks in the S&P 500 that didn’t pay dividends… Read More

If you’re a growth investor, it’s time to get a lot more boring with your portfolio.   Studies have shown that the real secret to beating the market isn’t growth stocks. Contrary to popular belief, the secret to outsized gains lies in dividends.   The respected research firm Ned Davis conducted a study over more than four decades. Their research found that dividend-paying stocks tend to beat the market over the long term and yield far better returns than stocks that don’t pay dividends.   #-ad_banner-#The Ned Davis study showed that stocks in the S&P 500 that didn’t pay dividends delivered a 2.5% annual return from 1972 through 2015. That would have turned a $1,000 investment into $2,910 over that timeframe.    By comparison, dividend-paying stocks in the S&P 500 returned 9% annually over the same period — also beating the S&P 500’s 7.4% annual return.    In this scenario, a 9% annual return over this period would have turned a $1,000 investment into $43,850.   This might be discouraging if you’re a young investor that owns all the FANG (Facebook, Apple, Netflix, Google) stocks. But don’t worry, this is a great time to swap out some of those growth… Read More

If baseball great Yogi Berra looked at a 20-year chart of the Nasdaq Composite Index, he might say that it’s “Déjà vu all over again.” To those who lived through the tech bubble, yours truly included, the chart does look eerily foreboding. And always remember that the most dangerous, and expensive, phrase in the English language is “this time it’s different”. At the turn of the century, top internet service provider American Online (AOL), now owned by telecom giant Verizon (NYSE: VZ), had just announced a now ill-fated merger with content trove Time Warner (NYSE: TWX). Recently, online… Read More

If baseball great Yogi Berra looked at a 20-year chart of the Nasdaq Composite Index, he might say that it’s “Déjà vu all over again.” To those who lived through the tech bubble, yours truly included, the chart does look eerily foreboding. And always remember that the most dangerous, and expensive, phrase in the English language is “this time it’s different”. At the turn of the century, top internet service provider American Online (AOL), now owned by telecom giant Verizon (NYSE: VZ), had just announced a now ill-fated merger with content trove Time Warner (NYSE: TWX). Recently, online retailer Amazon (Nasdaq: AMZN) announced it was acquiring grocery chain Whole Foods Market (NYSE: WFM) in its attempt to conquer the world, I guess. But while history may be starting to rhyme as the Nasdaq reaches nosebleed territory, and there is room to argue that the index does need to blow off a little froth, things may not be as treacherous as they may appear. Here are three observations. 1. Inflated Valuations Are Concentrated While the Nasdaq may be hitting all-time highs, the charge is being led by five stocks: Apple (Nasdaq: AAPL), Alphabet (Nasdaq: GOOG), Microsoft (Nasdaq: MSFT),… Read More

A pioneer in her own right, her incredible journey is well documented… as it should be. It’s gone on to help save the lives of thousands, if not hundreds of thousands, of women. It also set the stage for one the greatest developments in medical history. The year was 1990, and Barbara Bradfield discovered one of the worst things anybody can find: a lump on her breast and swollen lymph nodes under her arm.  A biopsy confirmed her worst nightmare — she had metastatic breast cancer. Surgery to remove her breast and the lymph nodes quickly followed. Then chemotherapy —… Read More

A pioneer in her own right, her incredible journey is well documented… as it should be. It’s gone on to help save the lives of thousands, if not hundreds of thousands, of women. It also set the stage for one the greatest developments in medical history. The year was 1990, and Barbara Bradfield discovered one of the worst things anybody can find: a lump on her breast and swollen lymph nodes under her arm.  A biopsy confirmed her worst nightmare — she had metastatic breast cancer. Surgery to remove her breast and the lymph nodes quickly followed. Then chemotherapy — one of the few treatments available at the time. In 1991, more than 43,000 people died of breast cancer. Barbara expected to be one of them, as the survival rate for patients like her was about 20%. In fact, Barbara’s form of cancer was so aggressive that most doctors gave her no chance of surviving.  The surgery and chemotherapy didn’t work. Cancer returned. And her doctor offered the only thing he could at the time: more chemotherapy. But they both knew that this would only extend her life by a few months.  Barbara declined all further treatment.  She was staring… Read More

After many years in the trenches conducting investment research, I rarely get excited about mainstream public companies. However, every once in a while I’m surprised by an amazing success story and investment opportunity. And today I’ve found one such little-known, niche company.  With metrics revealing true longevity, like the steady 5% growth per year over the last half century, 16% compounded sales, and earnings growth since 1990, this company is a shocking find. Even better, it’s part of a growing $700 billion-plus market.  Add in the facts of the company being family run and that it only boasts around a… Read More

After many years in the trenches conducting investment research, I rarely get excited about mainstream public companies. However, every once in a while I’m surprised by an amazing success story and investment opportunity. And today I’ve found one such little-known, niche company.  With metrics revealing true longevity, like the steady 5% growth per year over the last half century, 16% compounded sales, and earnings growth since 1990, this company is a shocking find. Even better, it’s part of a growing $700 billion-plus market.  Add in the facts of the company being family run and that it only boasts around a 2% share of its market, and it paints a powerfully attractive long-term growth picture.  The company, Heico (NYSE: HEI), is a manufacturer based in Hollywood, Florida. It creates original equipment manufacturer (OEM) parts for the $700 billion plus aerospace sector.  According to Deloitte LLP’s 2017 Global Aerospace and Defense Sector Outlook, there is currently a backlog of 13,500 commercial aircraft, marking an all-time high. Deloitte analysts have forecasted commercial aerospace subsector operating earnings to grow 20.6%, while defense subsector’s operating earnings will likely rise 7.0%. Even defense returns are expected to increase at just over 3%… Read More

Imagine if you could have foreseen just how successful Apple (Nasdaq: AAPL) was going to be at changing the music industry with the introduction of the iPod, iPhone and iTunes ecosystem. Or that folks would no longer run down to their local Blockbuster to rent a movie, but instead stream it over the internet — rendering DVDs all but dead. Of course, there are countless stories like these that illustrate how technological innovations killed off old stodgy companies and industries. 8-track and cassette tapes, VCR and DVD players, 3.5-inch floppy disks and developing film (Kodak) just to name a few. Read More

Imagine if you could have foreseen just how successful Apple (Nasdaq: AAPL) was going to be at changing the music industry with the introduction of the iPod, iPhone and iTunes ecosystem. Or that folks would no longer run down to their local Blockbuster to rent a movie, but instead stream it over the internet — rendering DVDs all but dead. Of course, there are countless stories like these that illustrate how technological innovations killed off old stodgy companies and industries. 8-track and cassette tapes, VCR and DVD players, 3.5-inch floppy disks and developing film (Kodak) just to name a few. Heck, even the pound sign is being replaced with the hashtag. #-ad_banner-#In hindsight, it’s easy to spot these major trend changes, but of course forecasting the next major revolution is never that simple. Just take Sirius and XM radio, for example. These two companies aimed to change the radio industry by providing ad-free music to consumers across the nation. This novel idea seemed destined to kill off traditional radio as we knew it. After all, radio hadn’t seen any major advances in decades, plus it’s annoying to hear your favorite AM or FM radio station fade away as you traverse… Read More