A Tweet Chinese Surprise
I’m watching the markets tick higher today with amusement.
The Dow is up 200 … 300 … 400 points. For some reason, I’m hearing this in Bono’s voice from “Bullet the Blue Sky.”
As Great Stuff predicted on Tuesday, the White House set an official date for U.S.-China trade talks, leading to a market rally. Representatives from the U.S. and China will meet in October, with preliminary communication to set the stage taking place in mid-September.
It’s all going according to plan. The only thing we’re missing is a Trump tweet proclaiming … wait, we have a tweet? From China?
Hu Xijin, editor-in-chief of the Global Times — a Chinese state-run newspaper — tweeted out: “There’s more possibility of a breakthrough between the two sides.”
Color me surprised.
Adding to today’s trading fury, the ADP and Moody’s Analytics payrolls report came in much stronger than expected. The U.S. economy added 195,000 new jobs in August, well above the 140,000 expected by economists.
The official U.S. August nonfarm payrolls report arrives tomorrow, but ADP has set the stage for another rally if that figure comes in strong.
The Takeaway:
It’s easy to get carried away by all the hype today … especially with talk of a “breakthrough” in U.S.-China trade relations and positive economic data.
Just remember: We’ve seen this all before … like, last month … and the month before.
By the same measure, it’s also just as easy to get carried away by all the negativity and market-recession headlines in the financial media.
What you need is levelheaded advice on how to trade this constantly rebounding market.
Banyan Hill expert Paul can help. He and his team have the knowledge and insight to help you find the best rebounding stocks on Wall Street … turning the market’s pain into your biggest gains.
The Good: The 420 on Cronos Group
After being pummeled for the better part of the year, the cannabis market may be ready for a turnaround. One particular highflier, Cronos Group Inc. (Nasdaq: CRON), has shed roughly 40% since April. But BMO Capital Markets says it’s time for a change.
Analyst Tamy Chen believes the drop is over. Noting that CRON is now in line with her expectations, Chen upgraded CRON to market perform, but lowered her price target to CA$16 from CA$17.
While Cronos’ production and sales are a bit behind its peers, Chen said that “value-add” products (vapes, edibles, etc.) could boost the cannabis company in the long run.
Why is this good? Because it’s refreshing to finally see a more measured take on cannabis stocks instead of the insane amount of hype that accompanied their debut on the market. In short, this moderation is a sign that the cannabis market may have finally bottomed.
The Bad: Cutting the Slack
In the current market, there’s no room to slack off … especially in earnings.
Slack Technologies Inc. (NYSE: WORK) is finding that out the hard way today. The office-collaboration company — aka corporate messaging software maker — beat both top- and bottom-line expectations with its second-quarter report. However, guidance was well below Wall Street’s targets.
Losses narrowed to just $0.14 per share as revenue soared 58% to $145 million. Both figures blew past the consensus estimates. Guidance, however, was placed at a loss of $0.08 to $0.09 per share, versus targets for a $0.07 loss. Revenue forecasts for $155 million were roughly in line with the consensus.
The problem for Slack is a surging Microsoft Corp. (Nasdaq: MSFT). Skype for Business and Microsoft Teams are gaining massive traction, and are bolstered by their integration with the No. 2 corporate cloud-computing platform in the world: Azure.
Slack can’t afford to slack off any longer.
The Ugly: Incogmeato
We all knew competition was coming for Beyond Meat Inc. (Nasdaq: BYND). We just didn’t expect it to be so … incompetent?
Both the Kellogg Co. (NYSE: K) and Hormel Foods Corp. (NYSE: HRL) tossed their hats into the meatless ring today.
Hormel launched its plant-based meat brand, Happy Little Plants, in grocery stores this week. All in all, the name isn’t half bad. But I’m left wondering if the plants will still be happy after I eat them.
I’m getting a California Raisins “eat me” vibe here. Also, are these happy little plant children? Too many questions.
That said, Hormel brings some serious cash and brand recognition to the table, meaning it could be a threat to Beyond Meat once Happy Little Plants hits its stride.
Kellogg is launching its own meatless brand in 2020. And, I kid you not, it’s called Incogmeato.
People — lots of people — got paid to sit in meetings for months to come up with that. Let that sink in. Or don’t … it sounds gross.
Incogmeato sounds like meat wearing sunglasses. It sounds like what we used to call the mystery-meat chili back in middle school. If meat entered the FBI’s witness protection program, it would have to go incogmeato. It might be beef. It might be plants. It might be ostrich or possum or dog. We don’t know. It’s incogmeato.
I’m more than a little grossed out right now. Thanks, Kellogg. I think I’ll go find some happy little plants to make me feel better … or Tums. Definitely Tums.
I need to get the aftertaste of that out of my mouth. Let’s try it with a little help from our friends. It’s reader feedback time!
I need a fresh palate here, so we’re starting with Cathy S. She wrote:
You guys are a breath of fresh air in a world full of fumes!
Keep it up!!!
Thanks, Cathy! I’m glad I can brighten up this stinky market a bit for you.
Next, we have Shawn P., who was, like, totally channeling Jeff Spicoli:
Dear Great Stuff writer dude haha,
I enjoy the things that you write about because it definitely keeps me busting a gut. It also keeps me well informed. Hey, it’s the best of both worlds haha! Keep it coming.
My favorite Banyan Hill expert is, of course, Paul. No last name needed haha. He is the one and only Paul at Banyan Hill, unless you all are keeping the other ones hidden lol.
Right on, Shawn! And I assure you that we aren’t hiding any other s here at Banyan Hill. Paul is, indeed, the one and only. Though I will neither confirm nor deny that cloning efforts are underway.
Finally, we received a great story from David M.:
I’ve been with Banyan Hill since January of 2017. I was first attracted to Paul ’s Profits Unlimited, and as I followed him I appreciated his explanations of what’s REALLY going on with the markets and the market makers. The next month, he introduced Extreme Fortunes. I had just finished an article about Roche Diagnostics investing in a little company called Foundation Medicine. That was the first recommendation Paul made and I jumped on board, increasing my position in May when he raised the buy-up-to price and also added a couple call options. I ended up making upwards of $40,000 when we sold a year later.
I am a Total Wealth Fellowship member, as everyone there at Banyan Hill is interesting to read and follow. I have a special interest in Ian Dyer. He talks in layman’s terms (well, everyone there does) and just sounds like a really smart guy. I met him and his lovely wife at the Total Wealth Symposium in Las Vegas last year, as well as Ian (and Mrs.) King, who also impresses me as a smart young man.
Man, you guys really love you some Paul . Thank you for writing in, David!
For those of you who don’t know, Ian Dyer is the co-editor for Paul’s Rapid Profit Trader and The $10 Million Portfolio services.
Finally, the Total Wealth Symposium is a great way to meet and rub elbows with Paul, Ian, Ted Bauman, Jeff Yastine, Michael Carr, Ian King and the rest of the Banyan Hill experts.
This year’s symposium is being held next week in sunny Amelia Island, Florida. Unfortunately, tickets are sold out. (I told you to get those tickets I put on hold for you!)
However, you can live-stream the whole thing directly to your phone, TV or computer! It’s like Banyan Hill reality TV … except with, you know, useful information that could change your life!
Click here now to find out how to live-stream the Total Wealth Symposium.
Until next time, good trading!
Regards,
Joseph Hargett
Great Stuff Managing Editor, Banyan Hill Publishing