Two of the smartest investors in the business are John Paulson and Stephen Mandel.  #-ad_banner-#Paulson, by far the more famous of the two, is best known for making $15 billion in the financial crisis by shorting the housing market.  In contrast, Mandel started his hedge fund, Lone Pine Capital, in 1997 after studying under Julian Robertson  at Robertson’s investment firm Tiger Management. That makes Mandel a member of the “Tiger Cubs,” a group of Robertson proteges that includes the likes of John Griffin, Lee Ainslie and Chase Coleman. One thing both investors agree on is that… Read More

Two of the smartest investors in the business are John Paulson and Stephen Mandel.  #-ad_banner-#Paulson, by far the more famous of the two, is best known for making $15 billion in the financial crisis by shorting the housing market.  In contrast, Mandel started his hedge fund, Lone Pine Capital, in 1997 after studying under Julian Robertson  at Robertson’s investment firm Tiger Management. That makes Mandel a member of the “Tiger Cubs,” a group of Robertson proteges that includes the likes of John Griffin, Lee Ainslie and Chase Coleman. One thing both investors agree on is that housing won’t stay in the doldrums forever. While housing has been recovering since it bottomed in 2009, housing starts still aren’t where they were before the financial crisis. (My colleague Dorian Davis recently suggested a clever way to profit from this trend.) Paulson and Mandel are investing in the housing recovery with real estate firm Realogy Holdings (NYSE: RLGY). Each has a stake worth over $500 million in Realogy, and together, they own more than a sixth of the company. As the largest owner and franchiser of residential real estate brokerages in the U.S., Realogy owns some of the biggest… Read More

The electric vehicle (EV) market has been hot, to say the least. But at first glance, investors looking to profit from this industry would appear to have few options.  #-ad_banner-#Tesla (Nasdaq: TSLA), of course, has done a lot to bring EVs front and center — but you don’t have to invest in Tesla, which is trading at 13 times sales and 30 times its book value after a run-up of more than 500% over the past three years. There are other, much more underrated plays on the EV industry.  The first one I have in mind… Read More

The electric vehicle (EV) market has been hot, to say the least. But at first glance, investors looking to profit from this industry would appear to have few options.  #-ad_banner-#Tesla (Nasdaq: TSLA), of course, has done a lot to bring EVs front and center — but you don’t have to invest in Tesla, which is trading at 13 times sales and 30 times its book value after a run-up of more than 500% over the past three years. There are other, much more underrated plays on the EV industry.  The first one I have in mind is Kandi Technologies (Nasdaq: KNDI), a Chinese maker of vehicles such as all-terrain vehicles and go-karts.  EVs have yet to really take hold in China given the required infrastructure, not to mention the high cost of EVs. But as contrarian investor Jim Rogers has noted, “China is the next great country in the world.”  Rogers is encouraged by the government’s decision to inject money into various sectors. In addition, the government is giving Chinese makers of EVs a break on sales taxes until 2018 — a break that outside EV manufacturers like Tesla won’t enjoy. In terms of infrastructure, China’s… Read More

It’s not often you find Warren Buffett and T. Boone Pickens owning the same stock. #-ad_banner-#Buffett has long been known to be focused on financials and consumer product companies such as Coca-Cola (NYSE: KO). But he also likes blue-chip chemical companies like Dow Chemical (NYSE: DOW), for which he’s in a showdown with Dan Loeb. In contrast to Buffett’s diversified approach, Pickens made his fortune in the energy patch. Considered one of the top energy experts in the world, Pickens is regularly seen on CNBC and Bloomberg talking about his “Pickens plan” for energy independence. Read More

It’s not often you find Warren Buffett and T. Boone Pickens owning the same stock. #-ad_banner-#Buffett has long been known to be focused on financials and consumer product companies such as Coca-Cola (NYSE: KO). But he also likes blue-chip chemical companies like Dow Chemical (NYSE: DOW), for which he’s in a showdown with Dan Loeb. In contrast to Buffett’s diversified approach, Pickens made his fortune in the energy patch. Considered one of the top energy experts in the world, Pickens is regularly seen on CNBC and Bloomberg talking about his “Pickens plan” for energy independence. Buffett’s Berkshire Hathaway (NYSE: BRK-B) has the largest stake in this energy company, with 13 million shares, worth over $500 million. Pickens’ stake is worth about $160 million.  The company that has brought these investing legends together?  Suncor Energy (NYSE: SU). The world’s largest oil sands producer, Suncor also has conventional oil and gas operations in the North Sea, North America, Libya and Syria. It also has refinery operations and retail stations in Canada and Colorado, wind power projects and an ethanol plant in Canada, and an energy-trading operation. Its conventional reserves generate high levels of free cash flow, which… Read More

With the market at or near its all-time highs, a number of renowned investors and market commentators have been questioning the market’s valuation over the past month or so.  #-ad_banner-#Billionaire Carl Icahn is the latest to grow wary of the market. “In my mind, it is time to be cautious about the U.S. stock markets,” he said last week. So how do investors prepare for a pullback? The first group of stocks to avoid is the momentum names, which trade on investor optimism, not on the strength of their fundamentals. Stocks that trade at… Read More

With the market at or near its all-time highs, a number of renowned investors and market commentators have been questioning the market’s valuation over the past month or so.  #-ad_banner-#Billionaire Carl Icahn is the latest to grow wary of the market. “In my mind, it is time to be cautious about the U.S. stock markets,” he said last week. So how do investors prepare for a pullback? The first group of stocks to avoid is the momentum names, which trade on investor optimism, not on the strength of their fundamentals. Stocks that trade at outrageous valuations are often the first to be sold if the market takes a turn downward.  Icahn isn’t alone in his caution. Fellow billionaire David Einhorn is short a basket of stocks that trade at outsize valuations. In a Bloomberg interview earlier this year, Einhorn hinted that his targets to short include tech stocks with negligible earnings that are trading above 10 times sales.  Among the stocks that fit this bill are Twitter (NYSE: TWTR), TripAdvisor (Nasdaq: TRIP) and Zillow (Nasdaq: Z).  All three have price-to-sales (P/S) ratios above 15, and all three appear to be… Read More

When George Soros is the largest shareholder of any company, investors pay attention. Yet not even Soros is immune to market pullbacks, especially when an entire sector is weak. #-ad_banner-#For Soros, it’s like owning the best house in a depressed market. When the market bounces back, he’ll make the most money. That’s the case with Soros’ investment in ClickSoftware Technologies (Nasdaq: CKSW). At the end of this year’s first quarter, Soros owned nearly 10% of the outstanding shares, his largest stake percentagewise in any software company. ClickSoftware makes computer programs to manage workforces across a wide variety of… Read More

When George Soros is the largest shareholder of any company, investors pay attention. Yet not even Soros is immune to market pullbacks, especially when an entire sector is weak. #-ad_banner-#For Soros, it’s like owning the best house in a depressed market. When the market bounces back, he’ll make the most money. That’s the case with Soros’ investment in ClickSoftware Technologies (Nasdaq: CKSW). At the end of this year’s first quarter, Soros owned nearly 10% of the outstanding shares, his largest stake percentagewise in any software company. ClickSoftware makes computer programs to manage workforces across a wide variety of industries. Part of its weakness has been due to its transition to selling software as a service (SaaS) and offering its services in the cloud for a monthly fee.  ClickSoftware’s business model was previously based solely on selling software with an upfront contract and then installing the software on the client’s computers. In contrast, the risk of the cloud computing model is that clients can cancel their contracts at any time.  The transition to the cloud resulted in ClickSoftware posting a loss last year, its first in more than eight years. Although the company posted a 16% year-over-year increase in… Read More

It’s no secret that Latin America is one of the most attractive regions in the world for investors. While investors have previously invested in the region’s abundant natural resources, a rising middle class is creating opportunities for companies that rely on domestic demand.#-ad_banner-#​ Thus, investors should be looking to telecoms, retailers and airlines.  Telecoms will be big winners in a rising middle-class economy because mobile phones are becoming a necessity. Of course, the middle class will want to shop, so certain retailers will be especially appealing. Finally, the bustling middle class will want to enjoy their newfound wealth… Read More

It’s no secret that Latin America is one of the most attractive regions in the world for investors. While investors have previously invested in the region’s abundant natural resources, a rising middle class is creating opportunities for companies that rely on domestic demand.#-ad_banner-#​ Thus, investors should be looking to telecoms, retailers and airlines.  Telecoms will be big winners in a rising middle-class economy because mobile phones are becoming a necessity. Of course, the middle class will want to shop, so certain retailers will be especially appealing. Finally, the bustling middle class will want to enjoy their newfound wealth by traveling.  Let’s take a closer look at three of the best companies for capitalizing on these trends. America Movil (NYSE: AMX )   Market cap: $82.3 billion Recent price: $22.97 52-week range: $19.01-$23.85 Payout ratio: 34% Dividend yield: 1.7% America Movil is the dominant telecom company in Mexico. (Although Mexico is technically in North America, most analysts and economists consider Mexico a big part of the Latin American economy.) America Movil is controlled by Carlos Slim, the world’s richest man behind Bill Gates, with a net worth of around $72 billion. Slim is doubling… Read More

The airline industry has taken it on the chin over the past few weeks. The NYSE Arca Airline Index was down 6% in just over a week last month on a perfect storm of bad news. #-ad_banner-#However, the index is slowly climbing higher, demonstrating the resiliency of the airline industry amid a combination of higher oil prices thanks to the conflict in Iraq, a slump in business travel in Central and South America, and downward profit revisions by European operators. Each of the big three airline stocks are down at least 4% over the past week. Delta Air Lines (NYSE:… Read More

The airline industry has taken it on the chin over the past few weeks. The NYSE Arca Airline Index was down 6% in just over a week last month on a perfect storm of bad news. #-ad_banner-#However, the index is slowly climbing higher, demonstrating the resiliency of the airline industry amid a combination of higher oil prices thanks to the conflict in Iraq, a slump in business travel in Central and South America, and downward profit revisions by European operators. Each of the big three airline stocks are down at least 4% over the past week. Delta Air Lines (NYSE: DAL) is down 8%, United Continental Holdings (NYSE: UAL) is down 5%, and American Airlines (NYSE: AAL) is down 4%. A slight pullback shouldn’t come as a surprise, considering all three stocks were up 47% or more over the past year. However, despite the pullback, all three are off their lows of the month. This type of bounce in the current environment should be seen as a big positive by investors who have been on the fence about buying airline stocks. Surprising Strength Last week, the industry took note of the fact that World Cup fever slowed… Read More

If you hadn’t noticed, the major refining stocks have been taking it on the chin lately. But is this another buying opportunity from Mr. Market — or a sign of things to come?  #-ad_banner-#Well, it might be a bit of both.  The key issue is that a slight change in the export law could put serious pressure on refiners. (My colleague Chuck Marvin touched on this in a recent column.) However, the market is treating refiner stocks as though this law has already been changed — but it hasn’t.  The reward of owning the top refiners might well… Read More

If you hadn’t noticed, the major refining stocks have been taking it on the chin lately. But is this another buying opportunity from Mr. Market — or a sign of things to come?  #-ad_banner-#Well, it might be a bit of both.  The key issue is that a slight change in the export law could put serious pressure on refiners. (My colleague Chuck Marvin touched on this in a recent column.) However, the market is treating refiner stocks as though this law has already been changed — but it hasn’t.  The reward of owning the top refiners might well outweigh the risk. Many of these refiners still offer solid dividend yields and are compelling from a valuation standpoint.  For instance, consider a few of the nation’s top refiners: Valero Energy (NYSE: VLO), Marathon Petroleum (NYSE: MPC), and Phillips 66 (NYSE: PSX). Share prices of all three are in the red over the last month, while the S&P 500 Index is in the black:   VLO data by YCharts Shares of all the refiners crumbled the other week when two companies, Pioneer Natural Resources (NYSE: PXD) and Enterprise Products… Read More

The world’s richest man, Bill Gates, has been a pioneer when it comes to investing in boring industries. These investments are ‘steady as she goes’ when it comes to being big plays on the broader economy. #-ad_banner-#His favorite investments include the likes of railroad operators and garbage disposal companies. You can also add heavy equipment makers to his list of boring investments. Gates’ favorite picks in this space include two of the world’s largest equipment makers. My colleague David Sterman highlighted Gates’ love for Caterpillar (NYSE: CAT) earlier this year, including the fact that the equipment giant is a great… Read More

The world’s richest man, Bill Gates, has been a pioneer when it comes to investing in boring industries. These investments are ‘steady as she goes’ when it comes to being big plays on the broader economy. #-ad_banner-#His favorite investments include the likes of railroad operators and garbage disposal companies. You can also add heavy equipment makers to his list of boring investments. Gates’ favorite picks in this space include two of the world’s largest equipment makers. My colleague David Sterman highlighted Gates’ love for Caterpillar (NYSE: CAT) earlier this year, including the fact that the equipment giant is a great Total Yield play. Gates’ owns 11.2 million shares (just under 2% of the company) through the Bill & Melinda Gates Foundation. While Caterpillar is still a great stock to own, one of Gates’ most underrated investments is Deere & Co. (NYSE: DE). Gates is Deere’s largest shareholder, owning 8.1% of the company through his private investment fund, Cascade Investment. Nearly 80% of Deere’s revenue is derived from agricultural and turf equipment, which includes tractors, loaders and combines. Its construction equipment segment makes up less than 20% of revenues, and includes loaders, dozers and excavators. The construction business should get a… Read More

Proven reserves are one of the first things investors look at when valuing oil and gas companies.  #-ad_banner-#Proven reserves are defined as the quantity of energy sources estimated with reasonable certainty to be recoverable from established or known reservoirs under existing operating conditions. In other words, it’s the amount of oil and gas that a company has the means to extract.  As long as the company has the capital, the expertise and the resources to get that oil and gas out of the ground, it’s a gold mine for investors. Even better, when a company increases its proven… Read More

Proven reserves are one of the first things investors look at when valuing oil and gas companies.  #-ad_banner-#Proven reserves are defined as the quantity of energy sources estimated with reasonable certainty to be recoverable from established or known reservoirs under existing operating conditions. In other words, it’s the amount of oil and gas that a company has the means to extract.  As long as the company has the capital, the expertise and the resources to get that oil and gas out of the ground, it’s a gold mine for investors. Even better, when a company increases its proven reserves, it becomes a lot more valuable. One oil and gas company that recently doubled the proven reserves of its key project is Pengrowth Energy (NYSE: PGH), which explores for oil and gas in the Canadian provinces of Alberta, British Columbia, Saskatchewan and Nova Scotia. StreetAuthority first brought PGH to investors’ attention in May 2011. Over the past few years, Pengrowth has been selling off non-core assets to raise money to fund its crown jewel: its Lindbergh thermal oil project. Last year, Pengrowth sold more than $1 billion in assets to fund the first phase of the Lindbergh project, which… Read More