Market Apocalypse Now?
Welcome to Great Stuff’s Reader Feedback day.
This day is all about you our loyal readers. We answer your questions — market-related or not — and indulge in your rants.
Why? Because Great Stuff has the best readers of any financial rag on the internet. It’s why we call you the Great Ones. If you’d like to join the Great Stuff army, all you gotta do to join is to sing it the next time it comes around on the guitar … with feelin’.
Or, you know, write to us at GreatStuffToday@BanyanHill.com.
Today, we kick things off with a rather poignant email from the Great Stuff German consulate:
A new philosophy for you from the jungles of Nam 1971… “What’s going to happen tonight???” The answer covers everything: “Wait for it…”
— Bill in Nürnberg
Thanks for writing in, Bill. I’m getting heavy Apocalypse Now vibes, but some of the Great Stuff staff wagered you’re worried about pandemic lockdowns in Germany.
I was quick to remind them that you’re a Vietnam vet in Nürnberg. A lockdown is probably the Fürth-est thing from your mind.
(I can hear your eyes roll all the way across the pond, Bill.)
But you have a crucial point Bill. Wait for it. Patience.
Even Axl Rose knows that all we need is just a little patience.
And, like the photojournalist in Apocalypse Now said: “If you can keep your head when all about you are losing theirs and blaming it on you, if you can trust yourself when all men doubt you…”
I mean, I can … and so can Great Stuff readers.
The stock market … remember the stock market? This is an e-zine about the stock market.
The stock market has decided that it’s time for a postelection relief rally.
The Dow is up more than 7% from its October 30 lows.
The S&P 500 is up more than 8%.
The Nasdaq is up a whopping 9%.
Now, far be it for me to cast shade on a postelection rally. This is 2020, after all. We needed some relief — some certainty.
And here comes the “but.”
But … what’s changed after the election? The market grows increasingly certain that Joe Biden will be the next U.S. president.
That may be favorable for more pandemic relief spending, but Biden still faces a Republican-controlled Senate.
And the Senate prefers much tighter spending on pandemic relief, not the multi-trillion-dollar spending the Democrat-controlled House favors.
So, my advice for you, Great Ones is patience. Take a page out of Bill in Nürnberg’s book and wait for it.
If we’re truly headed toward a postelection rally, you still have time to place your bets.
And while you look at where to focus your investment dollars postelection, I know someone with some excellent advice on just how to strike when you’re ready…
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While everyone else frets over shake-ups and shake-outs, we’re going to twist and shout our way over to the Reader Feedback roundup.
If you wrote in this week, thank you! We appreciate every single question and diatribe in your emails — yes, even the proposals for new chicken farming startups. (Good luck on that, Ivan!)
So, when any of the topics below spark questions or inspire hot takes of your own, send ‘em our way.
GreatStuffToday@BanyanHill.com is your one-stop shop for all your pen-palling dialogues and market meme-worthy suggestions. Let’s dig in, shall we?
Even Baby Boomers and the Greatest Generation are backing off from Facebook due to the ugliness of politics. It will be interesting to see if there is a comeback after the election is over.
— Capt. Spike
Hey there, Captain! Throw Gen X in there while you’re at it.
For context, this email came in last week after we picked through the earnings rubble of Twitter Inc. (NYSE: TWTR) and Facebook Inc. (Nasdaq: FB). Yes, we’re finally starting to see the long-predicting (and for some eagerly awaited) decay of the social media world’s old guard.
I also noted: “Twitter and Facebook’s Instagram are still relatively popular with Millennials. So there’s hope for continued growth — for a while. And Millennials and Gen Z have shown they favor Snapchat, Pinterest and TikTok over traditional socials.”
It all comes down to the real essence of social media. No, not cat memes. Ad spending!
Coming off the doldrums of pandemic advertising cuts, we’re already seeing ads make a comeback, and it should increase going into the holiday season — especially now that Spotify, Facebook and literally everyone stopped reminding me to vote.
Political fatigue and the move away from certain platforms are but symptoms of the generational handover of social media.
What do you think? Is Spike on point with where social media’s headed? Have you bought any social media stocks? I want to hear your boldest predictions on how the Facebook fandango will play out!
The 5G Wall
“Is anybody out there?”
I bought NOKLA for the hype!
— Elissa J.
Hey you … out there in the cold, getting lonely, getting old. Can you invest in 5G?
Thanks for writing in, Elissa! So … NOKLA. Are we talking about Nokia? Nikola?
Or some super-secret partnership between the two? Aftermarket 5G-enabled hydrogen fuel-cell-powered semi-trucks? It’s the team-up no one asked for, but everyone needs. Don’t leave me hanging!
Let’s go with Finland’s Nokia (NYSE: NOK) for the fun of it, since Nikola Corp. (Nasdaq: NKLA) is still stuck face-planting in the revolving door of hype.
I’ll admit, I had to dig a little to see what hype Nokia’s had other than its usual 5G fanfare. Notably, the return of CEO Pekka Lundmark — Nokia’s lead from the ‘90s until the turn of the millennium. Since his announcement, NOK investors have partied like it’s 1999 (again).
Anyone remember where Nokia was 20 years ago? The best brickmakers in the business! Nigh-on indestructible phones — and the Snake game, don’t forget Snake — had everyone thinking Nokia would rule the world long into the Jetson age.
Then smartphones came, and there Nokia went. Or, at least, there Nokia went headfirst into the network game. And while Nokia had a huge lead in building out European 5G networks, it still has Swedish rival Ericsson (Nasdaq: ERIC) to contend with.
In the meantime, Nokia has pandemic pandemonium playing out on its margins, upsetting Wall Street. And pulling your guidance for the next three to five years? Great way to instill confidence in your returning CEO…
Steve’s Select Stocks
What’s your thoughts on GOGO, Marathon Oil, Trillium stocks?
— Steve Q.
Energy stocks, biotech and satellite data? Someone read the diversification manual — good on you, Steve! Let’s check out your selections.
I have as much faith right now in Gogo Inc. (Nasdaq: GOGO) as I have in gas station sushi. Last I heard, the in-flight internet company wanted to sell off its commercial aviation division and focus on business aircraft networks.
The real question here is … how are you feelin’ about airlines right now, Steve?
With Gogo targeting an even smaller market post-sale, its revenue stream is awfully specialized at practically the worst time for air travel.
And the past few days more than surely pushed GOGO past overpriced territory. But, as you know, “stonks only go up,” so of course, GOGO rallied almost 9% today along with the broader market.
The case with Marathon Oil Corp. (NYSE: MRO) is similarly simple. It’s old-world energy, end of story. There might be a little gas left in the MRO tank for when the pandemic is over and the economic recovery begins in earnest.
Oil is dead.
Oil is dead.
To shreds, you say?
To shreds. As goes oil, so goes Marathon — at least in terms of its former glory. Marathon hasn’t expanded into alternative energy like some of its peers. And the energy sector is eating up every new energy upstart alive.
(Click here for your way in on the energy revolution!)
OK, sorry Steve, this turned out to be more critical than positive … though warranted. I just don’t want to build you up (buttercup) just to let you down, you see?
Now, Trillium Therapeutics Inc. (Nasdaq: TRIL) — I like this company. The cancer treatment market is only getting bigger, and Trillium specializes in immuno-oncology, which turns the body’s immune system against cancer, moving past debilitating chemotherapy.
One note: Most of the company’s growth depends on treatments that are in Phase 1 testing. This is a bit of a risky play as those trials progress, and stock movement will be almost entirely news-based. But, if the company can nail it, it’ll either be big or get bought out.
The Pet Med Pusher Man
I am a fan of Great Stuff and look forward to reading it every evening; informative and humorous, so what more can one ask for?
The pet industry is growing and I would like to know if there is a stock in that field that stands out to you?
— Jeffrey D.
Jeffrey! I’m glad you wrote in — especially with a topic that’s not often discussed ‘round the Street.
You’d expect many big household names to invest in, but that’s not the case with pet stocks. That’s why Chewy Inc. (NYSE: CHWY) made such a hubbub when it went public last year — though watch how investors bought into the story there, not necessarily the business.
The pet world’s Amazon has tripled since the pandemic plunge as earnings start to live up to the hype. Though, between you, me and the rest of the ‘Stuff crew…
The medical — erm, veterinary — side of the pet market is where you want to look.
Everyone knows about PetMed Express Inc. (Nasdaq: PETS), but check out other lesser-known names like Zoetis Inc. (NYSE: ZTS) and Elanco Animal Health Inc. (NYSE: ELAN), which both provide vaccinations and medicines for pets and livestock.
From cats to cows, the pet med market isn’t slowing down anytime soon.
Nervous Nio Nancies
NI-NIO, NI-NIO, NI-NIO and NIO is its name. Sing that in the key of D for Dollars.
Sorry for the late submission, but couldn’t resist as I watch NIO move up today. Has been holding steady through the volatility recently, and now looks to break out on good news from China. Not everything that comes from China is bad.
I looked around the house today and much of what I have was made in China.
I read your comments on NIO and about looking for an entry point. I did the same thing when NIO was below $10 and then watched it to $15 and then to $18.
I finally decided that getting into NIO is like getting into a pool of water. You’re not sure if the water is warm or cold but the best way is to just jump in. I jumped in at $18 and glad I did.
Not only have they doubled sales this year, they are also developing better battery technology which will help promote NIO over EV competitors. There may be some volatility here, but the water is warm so just jump in.
— Dick K. 😎
Forget those Tesla-touting TikTok traders … Dick here is the first of many Nio-maniacs that will be made this year. Jeez, you want to talk about summer glow-ups…
I, for one, am glad you got in, Dick — especially with that entry point. Now, dozens of situations come to mind where “just jump, bro!” have been the last words heard before disaster … but I appreciate the sentiment, buddy.
Anyway, that about wraps up our roundup, and now you’re up to bat if your email isn’t in this issue. Meet us at GreatStuffToday@BanyanHill.com with your questions, rants, raves and vague allusions to who-knows-what.
We’ll see you right here tomorrow! Until next time, stay Great and check us out on social media: Facebook, Instagram and Twitter.
Editor, Great Stuff