Preferred shares can offer big-yields and less risk than common shares. And given the current market environment, some preferreds are offering particularly compelling opportunities as prices are down, yields are up and underlying businesses remain relatively healthy. This report gives a little more information on preferred shares, and then concludes with three examples that are particularly compelling investments for income-focused investors right now.
Market Update: A Lot Has Changed Recently
As you can see in the following chart, the market (as represented by the Nasdaq 100 (QQQ)) has been terrible this year, but things have perked up in recent weeks. This update/report reviews the causes of this year’s declines and the data points supporting continued recent market perkiness. We conclude with our strong opinion on how you may want to position your investment portfolio going forward.
Top Sales Growth Stocks (Enphase Edition)
Here is a look at some of the top revenue growth stocks (this year and next). One thing that may standout is Enphase Energy (ENPH). Enphase is the only name that passed this high-growth screen AND has a positive ytd return (red bars). It also has positive net margins (indigo bars) and an impressive business. Enphase announced very strong earnings yesterday that exceeded expectations (and the company raised guidance). Shares are up more than 15% today so far.
If I Could Own Just One Stock
As a long-term investor, I believe in owning a prudently-diversified portfolio of many stocks. However, if I could own just one stock, I’d want it to be a leader in the important categories of revenue growth, dividend income and financial strength (including profitability, a strong balance sheet and an attractive valuation). Following its new quarterly earnings release this week, this report reviews Microsoft’s business, its strengths (in the categories listed above), the risk factors it currently faces and then concludes with my strong opinion on whether Microsoft would be “the one.”
AGNC: Book Value Down, 12.1% Yield
Mortgage REIT AGNC Investment Corp (AGNC) announced quarterly earnings on Monday, and not surprisingly—book value took a hit (amongst all the interest rate and agency-spread movements). The yield has now mathematically climbed to over 12%, and some investors are left wondering if the shares are worth owning or if the risks are too great. In this report, we review the business, the outlook, valuation and risks, and then conclude with our opinion on investing.
Tech Wreck: 40 Worst-Performing Tech Stocks This Year
Consumer Sentiment as a Forward Indicator
Pre-market equity futures are slightly up as we head into a huge week for new economic data (fed meetings, GDP report and lots of corporate earnings announcements). Obviously equity markets have been ugly this year (the Nasdaq 100 is ~25%), but we’ve seen signs of a recovery in the last two weeks (e.g. rates down, equities up). For a little more perspective, consumer sentiment is also very low, but has picked up a bit recently. Here is a reminder of how markets often perform following low points in the Michigan Consumer Sentiment Index.
Dividend Aristocrats: A Look Under the Hood
There is almost a mystical aura surrounding the 60+ “Dividend Aristocrats.” To be included on this exclusive list, you must be an S&P 500 stock that has increased its dividend for at least 25 consecutive years. And there are many highly-respected companies on the list, including the likes of Johnson & Johnson (JNJ), Procter & Gamble (PG) and Exxon Mobil (XOM). However, before you go buying any stock just because it’s on this list, there are a few things you need to consider. Let’s start by looking at the list (below) and then dive into some details.
Digital Turbine: Attractive If Acquired, Attractive If Not
The market has sold off hard this year, especially if you are a high-growth technology company. One name that has gotten hammered particularly hard is mobile growth platform, Digital Turbine (APPS). In this report, we give an update on the business, the opportunities, profitability, valuation (as an acquisition target and as a standalone company) and our opinion on investing.
Growth Stocks Soaring Today!
Today is a monster “UP day” so far for most of the stocks that have sold off the hardest this year. In particular, we’ve seen high-revenue-growth companies with very weak earnings gaining 8%, 9%, and 10%+ today alone. What’s more incredible, if the rebound continues (which it will—eventually) these will be the types of stocks to gain the most.
Triton: Big-Dividend Common and Preferred Shares
With dividend yields ranging from 4.4% to 8.2%, shipping container leasing company, Triton International (TRTN), presents some interesting investment opportunities for income-focused investors that also like the potential for share price appreciation. This report reviews the company, its competitive advantages, current market conditions, valuation, risk factors and then concludes with our opinion about investing in the common shares as well as the five series of preferred stock.
New Watchlist: High-Income Allstars
As the market continues to rip higher today, we’ve added a new watchlist to the members only page called “High Income Allstars.” The list includes some of the most popular (and most widely followed) high-income securities in the market. We own a few of these names, and If you are an income investor—you’ve likely heard of most of them. It’s a great tool to follow what’s moving in the market and where the opportunities may be.
Reading the Tea Leaves: Increasing "All Clear" Signs?
Arguably, the ARK Innovation ETF (ARKK) was a leading indicator for the market during the pandemic bubble and then bust. And now ARKK—as well as the Nasdaq 100 (QQQ)—are now showing signs of strength from a technical standpoint. For starters, each of these two bellwethers (purple) have now broken above their 50-day moving averages (orange), while the S&P (SPY) and Dow (DIA) haven’t yet.
The Next Batch of Growth Stock Rockets?
With pre-market futures trading higher, and the market now a bit above its year-to-date lows, some investors are wondering if the selloff is finally over. To the contrary, this market can absolutely go lower from here, but in the long-term we believe “this too shall pass” and this market is eventually going higher. And the next cycle higher will likely be dominated by a new batch of “high growth” stocks. For your reference, here is a look at 28 of the highest revenue growth stocks (this year and next) that have not already grown very large.
Two New Purchases: Income Equity Portfolio
We just made two new purchases in our Income Equity Portfolio, one industrial REIT and one old-school blue-chip tech company. Both offer healthy dividends and attractive share price appreciation potential. As a reminder, the Income Equity Portfolio is outperforming the S&P 500 by double digits this year, and we’re using the broader market wreckage to pick up some low-priced shares.
25 Top Chip Stocks, Down Big (Sorted By Profit Margin)
200+ Big-Dividend Preferred Stocks for You to Consider
If you don’t know, preferred stocks can work a lot like bonds when interest rates rise (that’s why many prices are down and yields are up this year), but they are distinct in that they’re lower than bonds in the capital structure (but still higher than common shares), and preferred shareholders can basically get screwed in a bankruptcy (preferreds are not a loan, they are a form of equity). This report offers more details, including current data (yields, prices, recent performance, industries) on over 200 preferred shares for you to consider.
Contrarian Warning Signs
The S&P 500 is down 18.5% year-to-date and performance has been wide ranging. It’s highly unusual for a large swath of the index to be down over 40% and another group to be up more than 20%. But a look under the hood reveals many of the top performers have been “safety plays” such as lower beta utilities and pharmaceutical companies, and many of the worst performers are great companies now trading at very attractive valuations. Those who chased high growth at the end of 2021 got burned. Will those now flocking to high-flying energy and low-beta utilities stocks soon get burned too?
Resistance at the 50-Day Moving Average, Again?
Intel Is Ugly: So Are AMD, Nvidia and Micron
Top semiconductor businesses (including Intel, Micron, Nvidia and AMD) have a few things in common, such as strong margins and ugly year-to-date performance. However, their underlying businesses and growth rates are very different. This report focuses on Intel, the leader in PC and server chips, and then compares it to competitors Nvidia, AMD and Micron. We conclude with our opinion on investing.