If you are a big-yield contrarian investor, the CEF we review in this report is attractive for multiple reasons. For starters, it invests in a low-volatility “safe” market sector (that is currently underperforming and thereby creating an attractive contrarian opportunity, as we will explain). Next, it trades at a massive (and very inappropriate) discount to its NAV following a distribution right-sizing a few months ago (emotional investors have dramatically overreacted). The combination of these two factors have created a highly-compelling long-term investment opportunity for income-focused contrarian investors.
Fear Creates Opportunity: Buyout Targets + 2 Top Growth Stocks
Markets ticked lower again this past week (especially for growthier stocks) and a lot of investors are now fearfully looking at their account balances and wondering if they should sell! However, in the contrarian spirit of the newly announced Splunk (SPLK) acquisition by Cisco (CSCO), we share a list of targets for the next big buyouts (yet to be announced), plus two attractive growth stocks now trading at lower prices.
Quick Note: W.P. Carey Dividend Reduction
100+ Big-Yield REITs: Terrible Performance, Few Attractive Opportunities
The following table includes data on over 100 big-yield REITs, sorted by REIT industries (and then market cap). And as you can see, recent performance has been mostly terrible with 2-year total returns very negative, and lots of REITs sitting near 52-week lows. The carnage has clearly been worse for some industries more than others, and short-interest remains high in certain areas (indicating lots of investors believe there is still more pain to come). In this quick note, we briefly review the REIT market by sub-industries and then highlight a very select few big-dividend REITs that appear attractive and worth considering for investment.
PDI vs. PDO: Building A Monster Big-Yield Portfolio
There are as many prudent dividend strategies as there are dividend investors. However, in this report, we review three specific income-focused portfolio strategies, including monster big yields, dividend growth investing, and build-your-own income. Next, we dive into the details on two monster big-yield closed-end funds (“CEFs”) from PIMCO (PDI and PDO). After comparing these two funds in detail (including the 7 things we always consider when evaluating CEFs) we conclude with our strong opinion on which one is better, and how they fit (or do not fit) into our prudently diversified High Income NOW portfolio.
Quick Note: Big-Dividend BDC Market Update
Quick Note: Here is a look at updated performance for BDCs over recent (and longer) time periods. As you can see, the group has been strong this year, with many outpacing the S&P 500 yet still trading below reported book value. A few key observations, starting with Ares Capital and then moving on to some of the more “growth-focused” BDCs:
Rivian: Big Risks, Big Rewards. Buy, Sell or Hold?
You’re likely aware electric vehicle (“EV”) sales are on a high-growth trajectory. And you may also sense the growing popularity of Rivian Automotive (RIVN) Trucks, SUVs and Electric Delivery Vans. But are Rivian shares a buy, sell or hold? In this report, we review Rivian’s business model, its market opportunity, financials, valuation, risks, and then conclude with our strong opinion about investing in Rivian.
BMEZ: Big Distribution Cut, 17.0% Discount to NAV
Income Equity Portfolio Updates (New Positions)
The Income Equity Portfolio Tracker Sheet has been updated for September, and there are a few new buys and sells (we highlight them in this note). As a reminder, the objective of the Income Equity Portfolio is “steady income and long-term capital appreciation” by investing in blue-chip companies with earnings growth potential, attractive valuations (multiple expansion opportunity) and prudent capital allocation (including reinvesting in the business, dividends, share repurchase and strong balance sheet management). Here are the latest updates.
Quick Note: Barron's Says Enphase Shares Can Jump 80%. We Agree.
Quick Note: Barron’s thinks this beaten-down solar stock could jump 80%. We agree. It made our top 10 growth stocks list for this month, and in the quarters and years ahead, we believe the shares will be trading dramatically higher. You can read our previous full report on the business here.
Top Chip & Hardware Stocks Benefiting from AI and Cloud Migration
In this report, we review market sector performance. Technology continues to dominate, semiconductors in particular. We consider the themes behind the sector strength (e.g. Artificial Intelligence and the digitization of everything), and then dive into our top semiconductor (and related hardware) companies benefiting from the secular trends, including our current holdings.
Nvidia: Despite Price Gains, Valuation Now Lower
Updates: High Income NOW Portfolio
The Income Game Has Changed: Treasuries, Money Market Funds
If you haven’t been paying attention, shorter-term interest rates have risen sharpy, and investments that seemed absurdly inappropriate just two years ago—are now worth considering. For example, a 6-month treasury bill (see chart below) now yields its highest rate in over 20 years! Specifically, it’ll pay you over 5.4%--whereas 2 years ago it was ~0.0%! And interestingly, short-term treasuries yield more than long-term treasuries (i.e. an inverted yield curve which some suggest is a sign of economic challenges on the horizon).
Top Technology Sector Growth Stocks (Copy)
Top 10 Growth Stocks (Attractive Entry Points)
A lot of top growth stocks have sold off hard over the last month, and a select few of them provide extremely attractive entry points right now. In this report we share data on over 100 top growth stocks, briefly review macroeconomic conditions, discuss several massively disruptive secular trends, and then count down our top 10 growth stock rankings. We believe the names on this list have dramatic upside potential in the quarters and years ahead. However, if you are not a growth stock investor, this report is absolutely not for you.
Quick Note: Disciplined Growth Portfolio Updated
SoFi Stock: Outlook, Despite Biden, Student Loans Resuming, Growth Accelerating
The Supreme Court has ruled, and the Biden Administration is largely abandoning its fight to permanently cancel student loan debt for millions of Americans (until 2024, an election year, when the new plan will be touted). So what does this mean for SoFi, an already fast-growing fintech that expects its revenue to accelerate as federal student loan payments are now set to resume? In this report, we review how SoFi has been growing its business during the student loan pause, how it will benefit going forward, the company’s recent financial performance, valuation and risks. We conclude with our strong opinion on investing in SoFi.