Investors are not a discriminating lot. We’ve seen full evidence of this during the past few weeks. When they panic and hit the sell button, all stocks seem to get placed on the chopping block, regardless of whether they have strong or weak balance sheets, ample or minimal exposure to the turmoil in China, low valuations or high valuations… That blunt, indiscriminate approach also applies to sectors and industries. Potentially bad news for a few companies can lead a whole group to be tossed into the dustbin. That appears to be the case among one of our favorite income investments… Read More

Investors are not a discriminating lot. We’ve seen full evidence of this during the past few weeks. When they panic and hit the sell button, all stocks seem to get placed on the chopping block, regardless of whether they have strong or weak balance sheets, ample or minimal exposure to the turmoil in China, low valuations or high valuations… That blunt, indiscriminate approach also applies to sectors and industries. Potentially bad news for a few companies can lead a whole group to be tossed into the dustbin. That appears to be the case among one of our favorite income investments here at StreetAuthority: the energy-focused master limited partnerships (MLPs). In today’s essay, I’m going to show you why the selling is overdone — and how smart investors can take advantage and buy some of the best income-generating assets the market has to offer at compelling low prices. Although dozens of MLPs offer up a range of risk profiles, all have plunged sharply in recent weeks and months. And a man named Greg Armstrong may be to blame. Armstrong is the CEO of Plains All America Pipeline L.P. (NYSE: PAA). Plains All America falls into the “infrastructure” MLP category. The partnership… Read More

While it may feel as if the stock market is in a deep slump, the S&P 500 is still within 10% of its all-time high. Perhaps the market environment feels so lousy because many individual stocks are now trading far below their 52-week highs. In fact, more than a quarter of all stocks in the S&P 500 have fallen more than 30% from their peak. And fully 96 of the companies in the index are now trading more than 40% below the 52-week high. #-ad_banner-# I’ve spent the last week researching this group of laggards. Many — if not most… Read More

While it may feel as if the stock market is in a deep slump, the S&P 500 is still within 10% of its all-time high. Perhaps the market environment feels so lousy because many individual stocks are now trading far below their 52-week highs. In fact, more than a quarter of all stocks in the S&P 500 have fallen more than 30% from their peak. And fully 96 of the companies in the index are now trading more than 40% below the 52-week high. #-ad_banner-# I’ve spent the last week researching this group of laggards. Many — if not most — of them may stay stuck in a rut for some time to come, thanks to growth headwinds of still-rich valuations. Yet a handful of these losing stocks are clearly oversold, and poised for a sharp rebound in coming quarters. These are the three best opportunities I’ve found. Kohl’s (NYSE: KSS) Earlier this year, shares of this department store retailer were surging as management laid out plans to pursue more bold fashions for the back-to-school and holiday seasons. A period of subsequent tepid quarters have quashed investor enthusiasm, leading shares to fall sharply. To be sure, fiscal… Read More

In a move to settle edgy markets, the Fed recently postponed a highly-anticipated interest rate increase. But that doesn’t mean a hike isn’t still on the way. In fact, now is the perfect time for income-focused investors to start thinking about how your various investments will be impacted by the inevitable rise in interest rates. In a rising rate environment, there are a few industries and types of companies that are seen as less favorable than others. Take regulated utilities, for instance. Utility companies (or power companies) are regulated by states or municipalities and don’t have control over the rates… Read More

In a move to settle edgy markets, the Fed recently postponed a highly-anticipated interest rate increase. But that doesn’t mean a hike isn’t still on the way. In fact, now is the perfect time for income-focused investors to start thinking about how your various investments will be impacted by the inevitable rise in interest rates. In a rising rate environment, there are a few industries and types of companies that are seen as less favorable than others. Take regulated utilities, for instance. Utility companies (or power companies) are regulated by states or municipalities and don’t have control over the rates they charge their customers. They are subject to pricing caps, which limit their profit margins. So these utilities are typically reliant on debt and equity offerings to fund projects, such as network upgrades and expansions. That makes them extremely susceptible to liquidity challenges when rates go up. Another industry that is perceived to be hurt by rising rates: master limited partnerships (MLPs). This view, however, is not entirely accurate. Let’s look deeper. An MLP is a company that is structured to pass through its profits directly to its owners, or partners. That’s why they are also called “pass-through entities.” MLPs… Read More

It’s that time again — when nervous investors flee the market, and seasoned stock buyers look to make bigger profits. As I write this, the Dow Jones Industrial Average is nearly 900 points lower than it was at the beginning of August. That’s almost a 5% decline. The Nasdaq, meanwhile, has dropped more than 4%.  What a difference a month makes.  These moves were spurred by a global drop in stocks that saw markets like China, Hong Kong and Australia all fall significantly. The financial press is of course buzzing. Many observers are saying this is the start of a… Read More

It’s that time again — when nervous investors flee the market, and seasoned stock buyers look to make bigger profits. As I write this, the Dow Jones Industrial Average is nearly 900 points lower than it was at the beginning of August. That’s almost a 5% decline. The Nasdaq, meanwhile, has dropped more than 4%.  What a difference a month makes.  These moves were spurred by a global drop in stocks that saw markets like China, Hong Kong and Australia all fall significantly. The financial press is of course buzzing. Many observers are saying this is the start of a bear market, the beginning of the end for stocks, etc., etc. It’s times like these when it’s great to own a “Forever” stock. As I’ve discussed many times, the idea of Forever stocks is simple: as an investor, you want to buy great businesses that can be held for months, years, even decades, without worry. This theme is central to my premium newsletter, Top 10 Stocks. And it never ceases to amaze me that no matter how simple this idea sounds, so few investors actually follow it during good times, let alone periods of market volatility. Just consider the history… Read More

Note: Stay tuned at the end of this article for a bonus trade that could turn a 19% drop in today’s stock into 133% gains before year end.  It is provided courtesy of options expert Jared Levy who has recommended trades that delivered annualized gains of 220%, 508%,… Read More

Every investor wants to generate more income — and quicker. But how do you accomplish this without taking on extra risk? There’s a simple solution, but I bet only 1% of individual investors are doing it right now. It is not a complex trading strategy that involves a lot of time. But, then again, I’m also not simply buying and selling stocks either. My strategy is unique. Even Barron’s says, “One solution that deserves serious study is offsetting the expected lack of stock-investment returns with [this] strategy that, studies have shown, outperforms buy-and-hold investing.”  My strategy is a two-part approach… Read More

Every investor wants to generate more income — and quicker. But how do you accomplish this without taking on extra risk? There’s a simple solution, but I bet only 1% of individual investors are doing it right now. It is not a complex trading strategy that involves a lot of time. But, then again, I’m also not simply buying and selling stocks either. My strategy is unique. Even Barron’s says, “One solution that deserves serious study is offsetting the expected lack of stock-investment returns with [this] strategy that, studies have shown, outperforms buy-and-hold investing.”  My strategy is a two-part approach based on options — but not the tricky kind. Here’s how the first part works. Let’s say you own shares of Apple, and it’s trading for $100. You think Apple is a good, solid company that won’t necessarily skyrocket in the near term, but should reward you over the long haul. Your friend, however, thinks Apple’s share price is about to take off. He thinks that over the next few months it’s going to jump all the way to $200. So he comes to you with a proposal. He says he’ll pay you $500 today… if you agree to sell… Read More

What a difference a year makes. The market for initial public offerings (IPOs) was on fire in 2014, as 275 companies took the plunge, the highest figure since 2000. Those firms raised a collective $85 billion, which was also the best showing since 2000. A hot IPO market typically leads to great gains for investors lucky enough to get shares at the offering price. Fast forward to 2015, and the IPO market has cooled off. Many companies such as Airbnb, Uber, or Spotify that may have contemplated going public this year, appear to be content to raise more money from… Read More

What a difference a year makes. The market for initial public offerings (IPOs) was on fire in 2014, as 275 companies took the plunge, the highest figure since 2000. Those firms raised a collective $85 billion, which was also the best showing since 2000. A hot IPO market typically leads to great gains for investors lucky enough to get shares at the offering price. Fast forward to 2015, and the IPO market has cooled off. Many companies such as Airbnb, Uber, or Spotify that may have contemplated going public this year, appear to be content to raise more money from private equity investors. For the companies that did decide to proceed with an IPO, results have ranged from tepid to lousy. Indeed many companies that became public this year are now selling below their offering price. Here’s a look at three of them that have suffered from bad timing, but should post solid rebounds as they put a few more quarters under their belt as a public company. 1.    TerraForm Global (Nasdaq: GLBL) This company acts as an electric utility in many fast-growing emerging markets as Brazil, India and China, and derives almost of all of its power from… Read More

Call it American ingenuity, but the things we come up with are inevitably sought after by people in nearly every corner of the world. Even where the governments don’t like us — like in Russia and Iran. This has occurred throughout much of U.S. history. The list is endless: the cotton gin, the telegraph, the telephone, the light bulb, the airplane. You get the picture. #-ad_banner-#I’m not saying this to be patriotic. I say it to remind you that we have something unique in this country that’s helped us out of every economic mess we’ve found ourselves in. In fact,… Read More

Call it American ingenuity, but the things we come up with are inevitably sought after by people in nearly every corner of the world. Even where the governments don’t like us — like in Russia and Iran. This has occurred throughout much of U.S. history. The list is endless: the cotton gin, the telegraph, the telephone, the light bulb, the airplane. You get the picture. #-ad_banner-#I’m not saying this to be patriotic. I say it to remind you that we have something unique in this country that’s helped us out of every economic mess we’ve found ourselves in. In fact, nearly every time our economy has looked down and out, we’ve turned things around. And no one ever seems to see it coming. Take the baby boom for example. The world’s economy had just been devastated by WWII. We’d just picked up the tab to rebuild Europe, thrusting ourselves into crushing post-war debt totaling more than our nation’s GDP. And to make things worse, most American families were struggling just to return to normal life. Factories closed as they stopped producing war goods, and unemployment doubled as 10 million soldiers returned home. In fact, a year after the war, the… Read More

After a rapid ascent and then descent, many Chinese stocks are now back in bargain territory. The Hong Kong Index, for example, now trades for less than 10 times trailing earnings. While the government-mandated transition to a consumption-based economy has led to some economic dislocation, reforms around one sector may mean that stocks are undervalued even further. In fact, one industry leader could be valued at a sharp a discount to intrinsic value if reforms are pushed through as planned. The Chinese Government Wants Out Of The Pipeline Business As part of a broad reform of the energy sector,… Read More

After a rapid ascent and then descent, many Chinese stocks are now back in bargain territory. The Hong Kong Index, for example, now trades for less than 10 times trailing earnings. While the government-mandated transition to a consumption-based economy has led to some economic dislocation, reforms around one sector may mean that stocks are undervalued even further. In fact, one industry leader could be valued at a sharp a discount to intrinsic value if reforms are pushed through as planned. The Chinese Government Wants Out Of The Pipeline Business As part of a broad reform of the energy sector, the Chinese government announced plans in May to spin off pipeline assets at the two largest oil & gas companies, PetroChina (NYSE: PTR) and Sinopec (NYSE: SHI). Industry competitors argue that the two companies’ ownership of 89% of the country’s total pipeline capacity acts as a barrier to entry for others. By operating the pipeline assets independently,  other upstream explorers will have easier access to the nation’s pipeline transportation capacity. While the government has not released a timeline for finalizing the reform, analysts are expecting spinoffs to take place in the next six months. During the recent period of excessive… Read More