In today’s market, there are no shortage of ways to invest in the rebounding housing market. However, it’s tough to find one that’s still cheap. #-ad_banner-#The major homebuilders have already had a solid rebound, along with banks and home improvement retailers, but there is still one overlooked play on the housing market and rebounding economy. This particular retailer was a great investment last year, up 45% — but after hitting its 52-week high earlier this year, it’s down 20% year to date. Given the recent pullback, this company is no longer just a growth story, but a value play at… Read More

In today’s market, there are no shortage of ways to invest in the rebounding housing market. However, it’s tough to find one that’s still cheap. #-ad_banner-#The major homebuilders have already had a solid rebound, along with banks and home improvement retailers, but there is still one overlooked play on the housing market and rebounding economy. This particular retailer was a great investment last year, up 45% — but after hitting its 52-week high earlier this year, it’s down 20% year to date. Given the recent pullback, this company is no longer just a growth story, but a value play at that. Trading at just 13 times earnings, more than 25% below its historical average, Bed Bath & Beyond (Nasdaq: BBBY) has proven to be one of the more resilient retailers in the brick-and-mortar space. At a time when the likes of Amazon.com (Nasdaq: AMZN) is taking market share from brick-and-mortar stores, Bed Bath & Beyond has seen its sales grow at an annualized rate of 12% over the past three fiscal years. BBBY fell off a cliff after third-quarter results came in below consensus expectations for both the top and bottom lines. Although revenue and earnings missed estimates, it’s worth… Read More

The S&P 500 Index has bounced back from its healthy 6% sell-off and is again within spitting distance of its all-time high. And while the automotive industry’s recovery cannot be underestimated, shares of former blue-chip and Big Three automaker General Motors (NYSE: GM) are struggling, down 11% year to date. #-ad_banner-#I think the stock’s current pullback represents an excellent opportunity to participate in the continued recovery of the American auto industry. After being booted from the Dow 30 back in 2009 after filing for bankruptcy protection, GM relaunched as a publicly traded company in November 2010. Coming off… Read More

The S&P 500 Index has bounced back from its healthy 6% sell-off and is again within spitting distance of its all-time high. And while the automotive industry’s recovery cannot be underestimated, shares of former blue-chip and Big Three automaker General Motors (NYSE: GM) are struggling, down 11% year to date. #-ad_banner-#I think the stock’s current pullback represents an excellent opportunity to participate in the continued recovery of the American auto industry. After being booted from the Dow 30 back in 2009 after filing for bankruptcy protection, GM relaunched as a publicly traded company in November 2010. Coming off a July 2012 low, shares rocketed to a peak just below $42 in late December 2013. They now sit 13% below their highs, making them a great bargain. GM has two-year midpoint support at $30. A recovery to the highs near $42 following the recent pullback to $34 projects a measured move to $50. Only a weekly close below $30 would negate the technical pattern. The $50 target is about 37% higher than recent prices, but traders who use a capital-preserving stock substitution strategy could make triple-digit profits on a move to that level. One major advantage of… Read More

Thanks to an impressive recent rally, a number of stocks that had temporarily pulled back to bargain levels have already surged back to fresh highs. If you’re looking for solid bargains among companies that are at the top of their game… good luck. To find true bargains, you need to look at companies that have stumbled. Operational missteps are about the only reason for a stock to be out of favor these days. The key is to find the companies that have the ingredients to fix their problems. Here’s a look at three stocks trading well below recent highs —… Read More

Thanks to an impressive recent rally, a number of stocks that had temporarily pulled back to bargain levels have already surged back to fresh highs. If you’re looking for solid bargains among companies that are at the top of their game… good luck. To find true bargains, you need to look at companies that have stumbled. Operational missteps are about the only reason for a stock to be out of favor these days. The key is to find the companies that have the ingredients to fix their problems. Here’s a look at three stocks trading well below recent highs — each with catalysts to regain its footing in coming quarters. 1. Hercules Offshore (Nasdaq: HERO ) This provider of offshore drilling rigs and other equipment appears caught in a product cycle transition. The company is completing a new slate of rigs to put into service, but investors have grown concerned that those new rigs haven’t secured new long-term contracts. HERO, which traded up to nearly $8 last summer, now hovers around $4.50. That works out to be around six times projected 2015 profit forecasts. Shares of Hercules also trade well below book value, and have been a recent beneficiary of… Read More

Last week, the bellwether S&P 500 essentially drifted sideways as it negotiated its 1,851 Jan. 15 all-time high from below but failed to establish a new one, closing down 0.13% for the week. Weak manufacturing and housing data weighed on the market, and the January Federal Open Market Committee minutes didn’t help matters by indicating almost certain tapering this year in bond purchases. #-ad_banner-#The tech-laden Nasdaq 100 (-0.03%) and blue-chip Dow industrials (-0.32%) also closed lower for the week, with only the small-cap Russell 2000, eking out a small gain of 1.34%. Year-to-date, the major U.S. indices are mixed with… Read More

Last week, the bellwether S&P 500 essentially drifted sideways as it negotiated its 1,851 Jan. 15 all-time high from below but failed to establish a new one, closing down 0.13% for the week. Weak manufacturing and housing data weighed on the market, and the January Federal Open Market Committee minutes didn’t help matters by indicating almost certain tapering this year in bond purchases. #-ad_banner-#The tech-laden Nasdaq 100 (-0.03%) and blue-chip Dow industrials (-0.32%) also closed lower for the week, with only the small-cap Russell 2000, eking out a small gain of 1.34%. Year-to-date, the major U.S. indices are mixed with the Nasdaq 100 up 1.97% and Russell 2000 up 0.1%, but the S&P 500 down 0.7% and Dow off 2.9%. Improving Momentum in S&P 500, but Other Indices Must Confirm Last week, I pointed out that the Moving Average Convergence/Divergence (MACD) indicator, which plots the difference between a 12-day and a 26-day exponential moving average, was indicating a near-term decision point for the S&P 500, from which its late January decline should resume if still intact. The green circle in the right lower edge of the chart below, an updated version of last week’s chart,… Read More

Last fall, legendary investor Carl Icahn added a “sizable position” of Apple to his $16 billion holding company — Icahn Enterprises. Since he announced his purchase on Sept. 11, 2013, Apple is up 14.9%, handily outperforming the S&P’s 9.7% gain in that same time. After making the purchase, Icahn was quoted saying it was a “no-brainer” investment, citing that the company’s valuation was “extremely cheap” by the numbers. Icahn should know, too. Unlike most of today’s billionaires, he made his fortune entirely by investing in the stock market. Since he founded Icahn Enterprises less than 30 years ago, his company… Read More

Last fall, legendary investor Carl Icahn added a “sizable position” of Apple to his $16 billion holding company — Icahn Enterprises. Since he announced his purchase on Sept. 11, 2013, Apple is up 14.9%, handily outperforming the S&P’s 9.7% gain in that same time. After making the purchase, Icahn was quoted saying it was a “no-brainer” investment, citing that the company’s valuation was “extremely cheap” by the numbers. Icahn should know, too. Unlike most of today’s billionaires, he made his fortune entirely by investing in the stock market. Since he founded Icahn Enterprises less than 30 years ago, his company has enjoyed total returns in excess of 288,000%. #-ad_banner-#To put that in perspective, if you had invested $1,500 with him back in 1987, the size of your position would be worth over $4.3 million today. That kind of performance is one reason Chartered Market Technician Michael J. Carr recently designed a trading system to leverage the financial genius of investing gurus, like Icahn. By applying his proprietary trading system to stocks that are held by the market’s 20 most successful gurus — including Warren Buffett, George Soros and David Einhorn — Michael has earned big gains… Read More

When you hear of an investment opportunity you’re interested in, you might be drawn to something that can be described in a sexy way like “explosive” or “revolutionary.” #-ad_banner-#What you learn after a while, though, is that the most attractive adjective in investing is “consistency.” Stocks like Johnson & Johnson (NYSE: JNJ) don’t often make headlines, but they churn out steady results year after year. Since the beginning of 2012, JNJ is up 43%; with dividends reinvested, it’s up just over 50%. Call JNJ a boring stock if you want. I’ll take those types of returns all day long. But… Read More

When you hear of an investment opportunity you’re interested in, you might be drawn to something that can be described in a sexy way like “explosive” or “revolutionary.” #-ad_banner-#What you learn after a while, though, is that the most attractive adjective in investing is “consistency.” Stocks like Johnson & Johnson (NYSE: JNJ) don’t often make headlines, but they churn out steady results year after year. Since the beginning of 2012, JNJ is up 43%; with dividends reinvested, it’s up just over 50%. Call JNJ a boring stock if you want. I’ll take those types of returns all day long. But how about the best of both worlds — a consistent dividend-paying growth stock with plenty of upside? This stock has risen 110% since the beginning of 2012, and the company — which has being paying dividends since 1985 — recently increased its dividend by 15.8%. This month, the company beat fourth-quarter earnings estimates, bringing total 2013 earnings per share (EPS) to $5.93, up 14% from the previous year. The stock I’m talking about is Snap-on Inc. (NYSE: SNA), the eponymous maker of Snap-on tools and accessories for consumers ranging from do-it-yourselfers to oil workers in Alaska’s North Slope. Snap-on has… Read More

The Aflac (NYSE: AFL) duck is one of the strongest brands today. It’s genius marketing. But there’s much more to this behemoth than a clever and enduring ad campaign. The stock is a must-own. I first wrote about Aflac for StreetAuthority three years ago. The stock is higher than when I first profiled it, and the earnings projections are right about where I put them (give or take a few cents). Yet the market is still not that crazy about the stock. Good — that means better prices for us. #-ad_banner-#With a market cap of close to $30… Read More

The Aflac (NYSE: AFL) duck is one of the strongest brands today. It’s genius marketing. But there’s much more to this behemoth than a clever and enduring ad campaign. The stock is a must-own. I first wrote about Aflac for StreetAuthority three years ago. The stock is higher than when I first profiled it, and the earnings projections are right about where I put them (give or take a few cents). Yet the market is still not that crazy about the stock. Good — that means better prices for us. #-ad_banner-#With a market cap of close to $30 billion, Aflac sells supplemental health and life insurance in the U.S. and Japan. Most products are underwritten on an individual basis, but the company began writing group policies in recent years. In the U.S., Aflac’s product focus is primarily asset and income loss due to illness or injury. In Japan, the company’s focus is on designing products designed to help pay medical costs not covered under Japan’s national health insurance system. This is where I see the most opportunity for growth in the U.S. business. But more on that later. Aflac’s financial position is probably the best insurance for investor… Read More

I have studied technical analysis for many years. What I have discovered might come as a surprise to many: #-ad_banner-#The majority of technical analysis is pure nonsense. While patterns and indicators appear to repeat themselves in a consistent manner, most of the time these patterns have zero predictive value and are not consistently repeatable when properly statistically tested in the stock market. Hindsight bias and flaws in human perception are the main reasons that technical analysis remains popular yet fails again and again when applied to real-time decision-making in the stock market. However, there are two technical analysis patterns that… Read More

I have studied technical analysis for many years. What I have discovered might come as a surprise to many: #-ad_banner-#The majority of technical analysis is pure nonsense. While patterns and indicators appear to repeat themselves in a consistent manner, most of the time these patterns have zero predictive value and are not consistently repeatable when properly statistically tested in the stock market. Hindsight bias and flaws in human perception are the main reasons that technical analysis remains popular yet fails again and again when applied to real-time decision-making in the stock market. However, there are two technical analysis patterns that I have found that do actually put the odds in my favor when tested over a series of trades. Remember, this does not mean that every trade entered due to these patterns will be a winner. However, it does mean that more trade entries than not will result in profits. The patterns I’m referring to: 1. Stocks are more likely to fall after a series of successively higher closes than to continue higher. 2. Stocks are more likely to bounce higher after a series of successively lower closes than to continue lower. I know this flies in the face… Read More

Every quarter, we take a close look at the latest buys and sells from leading hedge fund managers. These “gurus” often commit millions of dollars to their favorite stocks. But they rarely show any broad predilection for any particular industry or sector. Yet many of the recent filings by these gurus show deep interest in just one group of companies: our nation’s energy refiners. These firms, which distill crude oil into gasoline, diesel and other petrochemicals, are emerging from a long slump as a rising output of U.S. oil enables them to generate higher processing volumes. I discussed the renaissance… Read More

Every quarter, we take a close look at the latest buys and sells from leading hedge fund managers. These “gurus” often commit millions of dollars to their favorite stocks. But they rarely show any broad predilection for any particular industry or sector. Yet many of the recent filings by these gurus show deep interest in just one group of companies: our nation’s energy refiners. These firms, which distill crude oil into gasoline, diesel and other petrochemicals, are emerging from a long slump as a rising output of U.S. oil enables them to generate higher processing volumes. I discussed the renaissance in energy refining back in August, and since then, the performance of the group has been mixed: #-ad_banner-#The divergent performances are due to regional positioning, as firms with Gulf Coast refineries have benefited from the elimination of a major supply bottleneck at a key storage hub in Oklahoma that has impacted underlying oil prices. Some firms have also suffered from unforeseen maintenance outages that led to sharp (though temporary) temporary dividend cuts. Despite their pullbacks since August, I remain a fan of CVR Refining (Nasdaq: CVRR), which I profiled in November, as well as Alon USA… Read More

When mobile phones flooded the market, there was a lot of concern that the need and desire for watches would decline. That hasn’t happened, and many investors missed out on an opportunity to buy low on apparel and accessories stocks that were squeezed by that anxiety. However, it looks like a similar opportunity is forming now. #-ad_banner-#Watches are still a huge market for retailers, estimated at $60 billion a year globally. Yet the risk that smart watches will take some market share from conventional watches is very real. However, the threat currently applies more to the U.S. than other major… Read More

When mobile phones flooded the market, there was a lot of concern that the need and desire for watches would decline. That hasn’t happened, and many investors missed out on an opportunity to buy low on apparel and accessories stocks that were squeezed by that anxiety. However, it looks like a similar opportunity is forming now. #-ad_banner-#Watches are still a huge market for retailers, estimated at $60 billion a year globally. Yet the risk that smart watches will take some market share from conventional watches is very real. However, the threat currently applies more to the U.S. than other major growth areas. With the rise of smart watches on the horizon, some investors are again shunning the major watchmakers. But one of the big problems with smart watches is that they haven’t yet become fashionable. Fossil (Nasdaq: FOSL) has been one of the most pressured stocks due to the notion that smart watches might eat into the market share of conventional watches. The retailer is essentially flat over the past two years. The sale of watches has remained strong throughout the financial crisis. From 2010 to 2012, industry sales grew at an annualized rate of nearly 30%. By comparison, sales… Read More