Last week, I shared with you the key to making money in the stock market.
A stock is not just a symbol on the screen. It’s a piece of a business.
Because every stock is attached to a business.
So that’s why I focus on the business when buying a stock, same as if I would buy a donut shop on the corner of Main Street.
Since I’m not going to quit my day job, I need to make sure the person running the business is a rock-star CEO.
In fact, Warren Buffett says you should look for three things in a person … “Intelligence, energy, and integrity. And if they don’t have the last one, don’t even bother with the first two.”
I totally agree.
In my 40-year career, I’ve seen firsthand how partnering with great CEOs can make all the difference when it comes to earning outstanding returns.
Partners in Profits
There was a company I bought around 2005.
The headquarters didn’t have a receptionist — only an answering machine. And I had a question regarding a real estate asset on the balance sheet.
So, I left a message. And I got a call back two days later. What I wasn’t expecting was for the CFO of the company to be on the other end.
We talked for a good while. He went through every question I had about the company with me and more.
Before hanging up, I had to ask: Why the answering machine?
He responded, there was no need for a receptionist: “Why waste money when the machine does the job and never calls in sick.”
Well, after I heard that, I bought more shares.
Two years later, I made around 5X my money.
I want to partner with people like that… Focused on the business, and being great stewards of shareholders’ money.
3 Rock-Star CEOs
That’s exactly what I do with my Alpha Investor recommendations.
My subscribers and I exclusively partner with rock-star management.
And the results, well, they speak for themselves…
Here are three examples:
- Matt Murphy became CEO of Marvell Technology, this leading supplier of chips for 5G.
He made a few strategic moves that were like watching “poetry in motion.” Since we added it to the portfolio in 2019, Marvell is now up 110%.
- Tricia Griffith started at car insurer Progressive working the claims department.
She had no problem crawling under cars to check out the damage … in a skirt and high heels! Her grit is what we like … especially now that she’s in the CEO suite. Progressive is beating GEICO and gaining market share. No surprise to me.
Since we added Progressive in 2021, it’s moved higher by 57%.
- Jayshree Ullal, fresh out of Cisco, was the first CEO at Arista Network, a supplier of hardware for cloud computing.
From a standing start, Ullal drove rev to $3 billion … and operating profit to $1 billion. Since we added it to the portfolio in 2020, we are ahead by 188%.
In case you’re wondering, all three of these positions are still in our portfolio…
No. 1: Marvell Technology Inc. (Nasdaq: MRVL).
No. 2: The Progressive Corporation (NYSE: PGR).
No. 3: Arista Networks Inc. (NYSE: ANET).
And we hope to keep them there for a very long time. This is just a glimpse of three of our open recommendations from the Alpha Investor portfolio.
If you want to see our full analysis on them and others you can partner with today, click here to see how you can join us.
Rock-star CEOs are far and few to be found. So when I find one, I want to partner with them as long as I can.
That’s why it’s a must-check box for my Alpha Investor strategy.
I research every CEO before recommending a single company. And for good reason…
Partnering early on with Warren Buffett when he bought Berkshire, Sam Walton when he founded Walmart or Jeff Bezos when he started Amazon … would’ve been all you needed to do.
Those investors that did, could’ve seen a $1,000 investment turn into tens of millions of dollars.
Next Rock-Star CEO to Partner With
Right now is the perfect time to start partnering with rock-star CEOs.
Such as the CEO we highlight in one of our latest recommendations…
(Find out how you can read the whole issue.)
He’s been called “Canada’s Warren Buffett.”
Since he became CEO in 2002 the stock price has soared more than 25X … outperforming the S&P 500 by more than six times.
His own stake in the company is worth more than $2 billion…
Yet this guy is as down to earth as you can get… He still rides the subway to work.
And right now, the stock price is trading at a huge bargain.
But if you’d like to know more about the next legendary CEO and how to partner with him, just GO HERE.
Founder, Alpha Investor
P.S. I just released five starter stocks to buy for 2023. These companies are led by rock-star CEOs and are trading at bargain prices right now. But I don’t know how long these bargains will last, so please don’t wait. See how you can get my list and more by clicking here.
Market Edge: Back to Normal in 2023?
“Normal” is not a word I would use to describe the last several years.
There was a tech stock bubble, a craze in meme stocks and cryptocurrencies, and a world-stopping pandemic, of course. That was all weird enough.
But long before anyone had ever heard of COVID-19, we saw the most abnormal event of my lifetime and possibly of all financial history: negative bond yields.
It’s not all that unusual for bonds to yield lower than the rate of inflation, thus having a negative “real” yield. But for a large chunk of the past decade, even the nominal yield was negative. Investors were literally buying a dollar’s worth of assets for $1.05, understanding that they were guaranteed to lose money on a bond held to maturity.
This isn’t normal … and it certainly isn’t logical. I’d argue it was a perversion of the basic laws of finance.
But that was the reality, made possible by unprecedented stimulus by the world’s central banks. As recently as 2021, there was more than $18 trillion in debt globally at interest rates lower than zero.
Yet, something interesting just happened.
With inflation surging out of control, the Fed, European Central Bank and virtually every other major central bank had to tighten monetary policy… and as of early 2023, the outstanding debt at subzero yields has all but disappeared.
As Charles Mizrahi has pointed out repeatedly, we’ve seen normalization in other pockets of the capital markets too. The crazy bubble mentality of 2020 and 2021 is long gone. Investors — gasp! — actually expect the companies they buy to have business models that make sense.
I expect this to be a major theme in 2023. I am absolutely, 100% sure, that there will be some bizarre happenings in the capital markets this year. It’s always like that, and it’s part of what makes this job fun. But the overriding theme will be sober normalcy.
In a market like this, it makes sense to focus on quality. Look for strong companies with growing, profitable businesses like Charles showed you today.
You’ll also want to focus on risk management. And to that end, you should give TradeStops a look.
I’ve personally used TradeStops for over a decade to help me avoid major losses. It makes investing simple and stress-free, keeping you in the winning positions and out of the money-losing ones.
Ian King is joining TradeSmith CEO Keith Kaplan next Tuesday, January 24, to show you why it’s never been a better time to up your investing game with TradeStops.
Click here to make sure you attend.
|Charles SizemoreChief Editor, The Banyan Edge|