Everybody loves a lottery ticket. People will weekly put down their hard-earned money for a 1-in-175 million chance of being rich.#-ad_banner-# And that is the kind of fervor that has driven shares of Tesla Motors (Nasdaq: TSLA) up more than 450% over the past year. Sure, the automaker is increasing production and profits are increasing, but there is nothing that can explain the surge in the stock price like good old-fashioned irrational exuberance. For investors who got in at the ground floor in 2010, congratulations. For those that have recently bought into the shares and are hoping on another quadrupling,… Read More

Everybody loves a lottery ticket. People will weekly put down their hard-earned money for a 1-in-175 million chance of being rich.#-ad_banner-# And that is the kind of fervor that has driven shares of Tesla Motors (Nasdaq: TSLA) up more than 450% over the past year. Sure, the automaker is increasing production and profits are increasing, but there is nothing that can explain the surge in the stock price like good old-fashioned irrational exuberance. For investors who got in at the ground floor in 2010, congratulations. For those that have recently bought into the shares and are hoping on another quadrupling, you may want to read on. You thought the car fire was bad Shares of the $19.6 billion company tumbled 10% in the two days after an Oct. 1 video showed a Model S on fire in California. CEO Elon Musk eventually identified the cause of the fire as a loose piece of metal from a passing truck that punctured the car’s battery. The National Highway Traffic Safety Administration has said it will not investigate the incident, but shares of TSLA still have not recovered to their pre-video high. Worse than the car fire, however,… Read More

Throw away your wallet. Toss out all those heavy, antiquated coins. Burn your checkbook. Cut up your credit cards. But make sure you keep your mobile phone. It’s how you soon may pay for almost everything you buy using a method some call the “mobile wallet” and others term “mobile money” but is most commonly known as mobile payment solutions. Mobile payment transactions are exploding. According to a report by Gartner Research, these types of payments totaled roughly $171.5 billion in 2012, a 62% rise from $105.9 billion in 2011. In 2012, roughly 212 million people worldwide made mobile payments,… Read More

Throw away your wallet. Toss out all those heavy, antiquated coins. Burn your checkbook. Cut up your credit cards. But make sure you keep your mobile phone. It’s how you soon may pay for almost everything you buy using a method some call the “mobile wallet” and others term “mobile money” but is most commonly known as mobile payment solutions. Mobile payment transactions are exploding. According to a report by Gartner Research, these types of payments totaled roughly $171.5 billion in 2012, a 62% rise from $105.9 billion in 2011. In 2012, roughly 212 million people worldwide made mobile payments, up 32% from nearly 160 million users in 2011. More importantly, Gartner expects mobile transactions will grow at an average pace of 42% a year. By 2016, the firm forecasts the mobile transaction market will be worth $617 billion with 448 million global users. This amazing growth outlook means tremendous opportunity for mobile payment service providers. Traders tapping into the trend now could also make stellar returns. Of the publicly traded mobile payment solutions companies, the one I like best is NXP Semiconductors (Nasdaq: NXPI) based on its solid chart and increasing revenue and profits.#-ad_banner-# The hardware… Read More

The notion of a wide moat around your castle has been around for centuries. The early moats were designed to repel rivals and prevent them from invading and conquering. Today’s moats also keep rivals at bay. Companies that have built a solid moat around their business, limiting the threat of competition and price wars to some degree, tend to garner higher valuations from investors. How do we know that? Because the Market Vectors Wide Moat ETF (NYSE: MOAT) exchange-traded fund (ETF), which debuted in April 2012, is handily outperforming its benchmark, the S&P 500 Index. The question for… Read More

The notion of a wide moat around your castle has been around for centuries. The early moats were designed to repel rivals and prevent them from invading and conquering. Today’s moats also keep rivals at bay. Companies that have built a solid moat around their business, limiting the threat of competition and price wars to some degree, tend to garner higher valuations from investors. How do we know that? Because the Market Vectors Wide Moat ETF (NYSE: MOAT) exchange-traded fund (ETF), which debuted in April 2012, is handily outperforming its benchmark, the S&P 500 Index. The question for investors: Is it better to own this fund, or to try to find your own companies with solid moats? To answer this, let’s first look at how this ETF is constructed. Deep Concentration Unlike many ETFs that own a tiny slice of hundreds of companies, this ETF has a roughly 5% weighting in just 20 companies. In the portfolio, you’ll find household names such as Coca-Cola (NYSE: KO), Cisco Systems (Nasdaq: CSCO), eBay (Nasdaq: EBAY) and Bank of New York (NYSE: BNY). It’s immediately clear why companies like Cisco or eBay get the nod as they possess the products… Read More

Stocks moved up the fourth week in a row and have delivered a large gain in the first 10 months of the year. For now, there is no reason to expect a reversal in the trend. Stocks Continue Setting New Highs SPDR S&P 500 (NYSE: SPY) added another 0.15% last week and is now up 25.55% for the year, including dividends.#-ad_banner-# To put this performance into perspective, we can review data for the S&P 500 index going back to 1928. This year’s performance would be the 22nd best year out of 86. After such a strong performance,… Read More

Stocks moved up the fourth week in a row and have delivered a large gain in the first 10 months of the year. For now, there is no reason to expect a reversal in the trend. Stocks Continue Setting New Highs SPDR S&P 500 (NYSE: SPY) added another 0.15% last week and is now up 25.55% for the year, including dividends.#-ad_banner-# To put this performance into perspective, we can review data for the S&P 500 index going back to 1928. This year’s performance would be the 22nd best year out of 86. After such a strong performance, many investors expect a decline, and the question becomes, “How bad will the decline be?” In the past, large gains have been followed by losing years 43% of the time. Overall, 28% of the 86 years have closed down, so there is a slight bearish bias for 2014. In each of the years that showed a gain larger than this year’s, stocks cooled off in the next year and showed a loss or smaller gain. This information should be used in the next few weeks as we prepare expectations for 2014. Earnings are likely to determine whether 2014 is an… Read More

It was another perfect month for Income Trader’s Amber Hestla… A few weeks ago, three more “put” options Amber sold for her Income Trader portfolio expired worthless (when a put expires worthless, the seller keeps the premium they collected from selling the option as a 100% profit). The most recent victories mark Amber’s 26th, 27th and 28th (out of 28) profitable closed trades. If you’re a regular StreetAuthority reader, you’re likely familiar with Amber’s put-selling strategy. If not, you can read our previous issues explaining it in detail here and here.  In short, Amber collects extra investment income… Read More

It was another perfect month for Income Trader’s Amber Hestla… A few weeks ago, three more “put” options Amber sold for her Income Trader portfolio expired worthless (when a put expires worthless, the seller keeps the premium they collected from selling the option as a 100% profit). The most recent victories mark Amber’s 26th, 27th and 28th (out of 28) profitable closed trades. If you’re a regular StreetAuthority reader, you’re likely familiar with Amber’s put-selling strategy. If not, you can read our previous issues explaining it in detail here and here.  In short, Amber collects extra investment income by selling put options on stocks she thinks are undervalued. These “Instant Income” checks, as she calls them, usually range anywhere from $100… to $150 … to even $200. (And this is just for one put option. Many of her readers scale up to collect even more income.)  #-ad_banner-#Most of the time — 93% in Amber’s experience — the option expires worthless and the money she collects is hers to keep as pure profit. But if you read the above paragraphs closely, you’ll notice I said Amber’s current track record implies she’s yet to close an unprofitable trade… So if… Read More

In many ways, using a tablet or smartphone at work beats a rigid desktop computer.#-ad_banner-#​ The portability of mobile devices makes it easier to perform tasks from anywhere — the lunchroom, a co-worker’s desk, at home, even in the car. Plus, it’s way more convenient to be able to access work and personal emails, files and apps on one device.  A recent study showed that almost 60% of employees bring some type of mobile device into the workplace. The act has become so commonplace that it now has its own acronym: BYOD (bring your own device). By the… Read More

In many ways, using a tablet or smartphone at work beats a rigid desktop computer.#-ad_banner-#​ The portability of mobile devices makes it easier to perform tasks from anywhere — the lunchroom, a co-worker’s desk, at home, even in the car. Plus, it’s way more convenient to be able to access work and personal emails, files and apps on one device.  A recent study showed that almost 60% of employees bring some type of mobile device into the workplace. The act has become so commonplace that it now has its own acronym: BYOD (bring your own device). By the end of this year, the number of mobile devices (mostly mobile phones) in the workplace is expected to reach 350 million globally. A whopping 57% of full-time employees are already using mobile devices for work-related tasks — half of which is unmonitored, unmanaged BYOD activity.  We love our toys, but mixing business with recreation presents huge headaches for the IT workers responsible for keeping company data secure and knowing who has which apps (and why and where). Workers who innocently hook up devices to company networks, download applications, access email and connect to private Wi-Fi networks can cause major disruptions. … Read More

Tracking the moves of insiders can often lead you to small, unknown companies that have a great deal of promise.  On the daily list of buys, you only rarely come across major insider buying involving large companies. But in the past few weeks and months, there’s been impressive clusters of buying among companies in the S&P 500. Three of them caught my eye. 1. Symantec (Nasdaq: SYMC ) President and CEO James Bennett just plunked down more than $2 million to buy 100,000 shares. This wasn’t just the conversion of stock options that you often find on insider… Read More

Tracking the moves of insiders can often lead you to small, unknown companies that have a great deal of promise.  On the daily list of buys, you only rarely come across major insider buying involving large companies. But in the past few weeks and months, there’s been impressive clusters of buying among companies in the S&P 500. Three of them caught my eye. 1. Symantec (Nasdaq: SYMC ) President and CEO James Bennett just plunked down more than $2 million to buy 100,000 shares. This wasn’t just the conversion of stock options that you often find on insider buying lists, but an actual purchase with real money. The move came after Bennett needed to rein in profit expectations amid a companywide restructuring. Make no mistake, software security vendor Symantec was in need of a shake-up. The company had seen robust growth in the past decade, as sales shot up from $2.6 billion in fiscal 2005 to $6.2 billion by 2009. However, sales in the current fiscal year are expected to be only 10% higher, equating to a compound growth rate of less than 2%. In the current quarter (which ends in December), sales are expected to fall 9% from a… Read More

Momentum remains on the side of technology giant Google (Nasdaq: GOOG) despite the large gains the it has made this year.#-ad_banner-#​ Following a big post-earnings rally in mid-October, GOOG consolidated and is forming a tight bullish wedge pattern. This offers traders another juicy long-side breakout trade.  Tight patterns often lead to quick moves. A break to new highs would keep the momentum on the side of the bulls, while any break below the consolidation pattern would be equally bearish and serve as an automatic stop-out area. Google reported third-quarter results after the… Read More

Momentum remains on the side of technology giant Google (Nasdaq: GOOG) despite the large gains the it has made this year.#-ad_banner-#​ Following a big post-earnings rally in mid-October, GOOG consolidated and is forming a tight bullish wedge pattern. This offers traders another juicy long-side breakout trade.  Tight patterns often lead to quick moves. A break to new highs would keep the momentum on the side of the bulls, while any break below the consolidation pattern would be equally bearish and serve as an automatic stop-out area. Google reported third-quarter results after the close Oct. 17, beating analysts’ estimates on all fronts. Earnings per share (EPS) were up 19% to $10.74 from the same quarter a year ago, beating estimates of $10.34. Revenue was up 12% to $14.9 billion, slightly better than the consensus estimate. As a result, GOOG exploded higher on massive volume on Oct. 18, and it hasn’t looked back. Google’s shareholders are no strangers to robust post-earnings moves, but the 13.8% rally was larger than usual, and it took the stock above $1,000 for the first time, setting a new all-time high. GOOG is up 43% this year, and while… Read More

I believe in China.  I have no doubt that this nation of 1.35 billion consumers will continue to lead the global growth boom over the next several decades. In addition, I want to share with you an underserved Chinese market that will likely explode over the next several years. There are several companies poised to capture this consumer wave that has swept over the Western world but is in its infancy in China.#-ad_banner-# Although China might not see a double-digit economic growth rate again, its current growth in the mid-single digits appears sustainable with continued government support. In… Read More

I believe in China.  I have no doubt that this nation of 1.35 billion consumers will continue to lead the global growth boom over the next several decades. In addition, I want to share with you an underserved Chinese market that will likely explode over the next several years. There are several companies poised to capture this consumer wave that has swept over the Western world but is in its infancy in China.#-ad_banner-# Although China might not see a double-digit economic growth rate again, its current growth in the mid-single digits appears sustainable with continued government support. In the most recent quarter, growth sank a two-decade low of 7.5% — but compared with any other economy, this remains a very impressive rate. China’s leading economic figure, Premier Li Keqiang, has vowed to keep growth at 7.5% or higher, though it’s important to note that other Chinese officials have forecast lower growth over the next several years. The truth is, the actual growth rate doesn’t really matter much for investors. In fact, the International Monetary Fund (IMF) recently indicated that slowing growth will actually lead to a higher quality of growth, which in turn will… Read More

Buying a house is a terrible way to profit from the recovery in the housing market. Houses are illiquid assets. They carry high transaction costs. And they are loaded with expenses such as insurance, maintenance and taxes. When you think about it, a house looks a lot like an “anti-dividend”: Investors pay a lot of money to own them. There’s a better way to cash in on the recovery in housing. This leading homebuilder provides incredible leverage against the ongoing recovery in housing without the burdens of buying a house. And with shares recently dipping 28% while earnings… Read More

Buying a house is a terrible way to profit from the recovery in the housing market. Houses are illiquid assets. They carry high transaction costs. And they are loaded with expenses such as insurance, maintenance and taxes. When you think about it, a house looks a lot like an “anti-dividend”: Investors pay a lot of money to own them. There’s a better way to cash in on the recovery in housing. This leading homebuilder provides incredible leverage against the ongoing recovery in housing without the burdens of buying a house. And with shares recently dipping 28% while earnings estimates continue to surge, this is a rare chance to buy on a pullback. Take a look at the recent pullback in the chart below. With a market cap of $1.5 billion, KB Homes (NYSE: KBH) is one of the largest homebuilders in the United States. Shares had been rallying big on the recovery in housing before this spring’s spike in interest rates triggered a wave of profit-taking that sent KB falling 28% from its recent all-time high.#-ad_banner-# That’s creating an opportunity to buy one of the best housing stocks at a relative discount. And KB has plenty… Read More