The roughly 70% drop in oil prices in less than two years has claimed many victims. The economies of entire countries such as Nigeria and Venezuela have been devastated. Shale oil boom towns like Fargo, N.D., have gone bust.  Shares of many energy companies have been decimated — some even to the point where it is probably too late to short them. For instance, stocks like Chesapeake Energy (NYSE: CHK) and Whiting Petroleum (NYSE: WLL) have lost more than 90% of their value since oil’s peak and now trade in the low single digits. However, one group has only recently… Read More

The roughly 70% drop in oil prices in less than two years has claimed many victims. The economies of entire countries such as Nigeria and Venezuela have been devastated. Shale oil boom towns like Fargo, N.D., have gone bust.  Shares of many energy companies have been decimated — some even to the point where it is probably too late to short them. For instance, stocks like Chesapeake Energy (NYSE: CHK) and Whiting Petroleum (NYSE: WLL) have lost more than 90% of their value since oil’s peak and now trade in the low single digits. However, one group has only recently begun to feel the heat from the plunge in crude: Canadian banks, which have significant exposure to oil and gas.   Of the six major banks in Canada, the one that looks the most vulnerable is The Bank of Nova Scotia (NYSE: BNS). #-ad_banner-# Commonly known as Scotiabank, it is the third largest bank in Canada, with assets of C$856 billion ($639 billion USD) at the end of fiscal 2015 (Oct. 31). The bank provides financial services to 23 million customers in more… Read More

Most investors are aware that the tech-heavy Nasdaq has a tendency to lead the market both up and down, and the current sell-off is no exception. The Nasdaq Composite is off more than 15% from its late-December highs, while the broader market is down just 10%. Tech stocks often take the brunt of the selling because they tend to carry higher valuations and are thus considered more risky.  #-ad_banner-#Since there doesn’t seem to be an end yet in sight to the current market correction, shorting overvalued tech stocks is a sound strategy to profit from this downtrend. And Universal Display… Read More

Most investors are aware that the tech-heavy Nasdaq has a tendency to lead the market both up and down, and the current sell-off is no exception. The Nasdaq Composite is off more than 15% from its late-December highs, while the broader market is down just 10%. Tech stocks often take the brunt of the selling because they tend to carry higher valuations and are thus considered more risky.  #-ad_banner-#Since there doesn’t seem to be an end yet in sight to the current market correction, shorting overvalued tech stocks is a sound strategy to profit from this downtrend. And Universal Display (Nasdaq: OLED) is a perfect candidate. Started in 1994, Universal is a leader in organic light emitting diode (OLED) technology, which contains organic films that emit light when struck by electric current. Universal own nearly 3,600 patents in the OLED space and also works with major universities on research. OLED technology is used for full-color displays in products such as smartphones, tablets and TVs. It’s both lightweight and power-efficient, while also offering superior color to many competing technologies. For instance, in the television market, its picture quality has helped it seize market share from its main rival, liquid crystal display… Read More

Tech stocks often lead the market down, and the current decline is no exception. Just two weeks into the new year, the S&P 500 is down 8%, which is substantial, but not as big as the tech-heavy Nasdaq Composite’s 10%-plus drop.   While tech weakness is widespread, one of the most vulnerable stocks is extreme action camera company GoPro (Nasdaq: GPRO). [Note: The weakness in tech has put solid companies on sale, including two major firms that made our list of the Top 10 Trades for 2016. You have until 11:59 p.m. on Thursday,… Read More

Tech stocks often lead the market down, and the current decline is no exception. Just two weeks into the new year, the S&P 500 is down 8%, which is substantial, but not as big as the tech-heavy Nasdaq Composite’s 10%-plus drop.   While tech weakness is widespread, one of the most vulnerable stocks is extreme action camera company GoPro (Nasdaq: GPRO). [Note: The weakness in tech has put solid companies on sale, including two major firms that made our list of the Top 10 Trades for 2016. You have until 11:59 p.m. on Thursday, Jan. 21 to access the report. Click here.] Shares of GoPro are down 36% in 2016 and now trade for less than half their $24 IPO price. The latest blow to the stock came when the company announced ugly preliminary results for the fourth quarter last week. #-ad_banner-# Management said they expect revenue to be just $435 million. That would represent a 31% year-over-year decline and is significantly below the $521 million expected by analysts and the $500 million to $550 million GoPro had itself projected.  In response, the company laid off 7% of… Read More

One of the most exciting technical events is when a prolonged downtrend line is broken to the upside.  First, this technical behavior signals a reversal in trader expectations from negative to positive. In other words, bulls are now swimming with the tide instead of against it. Second, if you buy the stock close to the trendline break, you are usually getting in on the cheap. The appreciation potential can be huge as the stock recovers and challenges previous resistance levels. While you may need to be patient as this resistance is encountered, the risk of trading the downtrend… Read More

One of the most exciting technical events is when a prolonged downtrend line is broken to the upside.  First, this technical behavior signals a reversal in trader expectations from negative to positive. In other words, bulls are now swimming with the tide instead of against it. Second, if you buy the stock close to the trendline break, you are usually getting in on the cheap. The appreciation potential can be huge as the stock recovers and challenges previous resistance levels. While you may need to be patient as this resistance is encountered, the risk of trading the downtrend line break is limited… and the reward can be significant. That is what we’re seeing with small-cap iRobot (Nasdaq: IRBT), which just broke an almost two-year-long downtrend.  iRobot was founded in 1990 by three MIT roboticists and went public in late 2005. It operates in two divisions: home products and defense and security. #-ad_banner-# The company’s most popular product is Roomba, a vacuum cleaner robot. Roomba has sensors that allow it to map and adapt to your home while proprietary technology allows it is keep track of where it has already cleaned. Roomba is already in millions of homes and… Read More

Last month, the world mourned terrorist attacks in Paris that left 130 dead. In the wake of the attacks, the State Department issued a global travel alert for U.S. citizens — an action that was both warranted and fear-mongering. Travel-related stocks, for instance, were punished following both events.  The travel alert is in place through Feb. 24, but we expect strong travel stocks to begin recovering before then, making now a good time to pick up shares on sale. With an aggressively expanding portfolio of companies, strong fundamentals and a bullish chart, our favorite stock in the $1.3… Read More

Last month, the world mourned terrorist attacks in Paris that left 130 dead. In the wake of the attacks, the State Department issued a global travel alert for U.S. citizens — an action that was both warranted and fear-mongering. Travel-related stocks, for instance, were punished following both events.  The travel alert is in place through Feb. 24, but we expect strong travel stocks to begin recovering before then, making now a good time to pick up shares on sale. With an aggressively expanding portfolio of companies, strong fundamentals and a bullish chart, our favorite stock in the $1.3 trillion global travel market is Expedia (Nasdaq: EXPE). Expedia established itself as the largest online travel company by bookings after acquiring discount travel site Orbitz in September. Earlier in 2015, it also acquired online travel agency Travelocity. #-ad_banner-# As a way of gaining competitive advantage over its chief rival, Priceline (Nasdaq: PCLN), Expedia plans to further expand its online presence by acquiring other players. To that end, the company just announced plans to dole out $3.9 billion to acquire do-it-yourself home rental agency HomeAway (Nasdaq: AWAY).  This strategic move will give Expedia further access to the… Read More

While companies like Google (Nasdaq: GOOGL) and Apple (Nasdaq: AAPL) are experimenting with the first self-driving cars, completely autonomous vehicles are probably at least a few years out. However, the technology that is making its way onto the road right now is still pretty amazing. For instance, with Tesla Motors’ (Nasdaq: TSLA) new autopilot system, its cars can brake, steer, accelerate, decelerate, change lanes and avoid obstacles by themselves. #-ad_banner-# Fully and partially self-driving cars rely on millions of miles of driving videos and data, which are fed into a computer’s data model. That’s where today’s stock pick… Read More

While companies like Google (Nasdaq: GOOGL) and Apple (Nasdaq: AAPL) are experimenting with the first self-driving cars, completely autonomous vehicles are probably at least a few years out. However, the technology that is making its way onto the road right now is still pretty amazing. For instance, with Tesla Motors’ (Nasdaq: TSLA) new autopilot system, its cars can brake, steer, accelerate, decelerate, change lanes and avoid obstacles by themselves. #-ad_banner-# Fully and partially self-driving cars rely on millions of miles of driving videos and data, which are fed into a computer’s data model. That’s where today’s stock pick comes in. Nvidia (Nasdaq: NVDA), best known for powering PCs and video games with graphic processors, has made the leap into driver assistance and display systems. The company makes high-performance chips that enable driver assistance systems to process massive amounts of data. It sells a Tegra X1 chip for automotive and gaming uses, and this summer started shipping its latest Drive PX computing system for self-driving cars and driver-assist applications.  Tesla uses Nvidia chips in the 17-inch screen and the instrument cluster for its Model S and might use the Drive PX in its Model X SUV. Meanwhile, Audi also… Read More

This stock is on the wrong end of a fading trend. In 2010, customers couldn’t buy enough of this company’s then-chic watches, jewelry, belts and sunglasses. Today, sales are declining worldwide.  Fossil Group (Nasdaq: FOSL) — a name that wasn’t meant to be ironic but may prove to be. In the rapidly changing world of fashion, the worst thing a brand can be is antiquated. This isn’t just a subjective interpretation of fashion trends either; the numbers and the stock chart all support the argument that Fossil is in trouble. All Signs Point Down For Fossil Let’s… Read More

This stock is on the wrong end of a fading trend. In 2010, customers couldn’t buy enough of this company’s then-chic watches, jewelry, belts and sunglasses. Today, sales are declining worldwide.  Fossil Group (Nasdaq: FOSL) — a name that wasn’t meant to be ironic but may prove to be. In the rapidly changing world of fashion, the worst thing a brand can be is antiquated. This isn’t just a subjective interpretation of fashion trends either; the numbers and the stock chart all support the argument that Fossil is in trouble. All Signs Point Down For Fossil Let’s start with a few fundamental reasons to be concerned over Fossil’s business. #-ad_banner-# Fossil’s most recent quarterly results were weighed down by negative currency exchange rates. In mid-August, Fossil reported second-quarter revenue dropped 4% year over year to $740 million — below analyst estimates for revenue of $750 million.  Things don’t look to be getting better. Nearly half of Fossil’s revenues come from Europe and Asia. Economic slowdowns there, coupled with a rising U.S. dollar, could reduce the amount it earns. Anticipating this, management lowered its full-year earnings per share (EPS) guidance to $4.80 to $5.60, down from… Read More

Although the S&P 500 has made a substantial recovery off its late-August lows, the technical condition of the broader market is still shaky. For starters, the death cross (200-day moving average crosses below the 50-day) is still in force on the index. The same technical configuration applies to both the Dow Jones industrials and transports as well. Further, overhead resistance on the S&P 500 looms close by. The declining 50-day moving average is at 2,039. Slightly above is strong lateral resistance near 2,045, which was the previous support level. For the cherry on top, many technicians believe a… Read More

Although the S&P 500 has made a substantial recovery off its late-August lows, the technical condition of the broader market is still shaky. For starters, the death cross (200-day moving average crosses below the 50-day) is still in force on the index. The same technical configuration applies to both the Dow Jones industrials and transports as well. Further, overhead resistance on the S&P 500 looms close by. The declining 50-day moving average is at 2,039. Slightly above is strong lateral resistance near 2,045, which was the previous support level. For the cherry on top, many technicians believe a double-bottom will need to be traced out before any all-clear signal can be given. #-ad_banner-# In this environment, weak stocks make good shorts, and one of the most vulnerable is XenoPort (Nasdaq: XNPT). The California-based biopharmaceutical firm focuses on developing treatments for neurological and autoimmune disorders.  The stock suffered an enormous blow on Sept. 15, when shares plummeted 28% on staggering volume following news the company’s psoriasis drug, XP23829 — currently in a mid-stage, Phase II trial — caused negative and potentially harmful side effects, including diarrhea, stomach pain and vomiting. Due to these health risks, nearly a third of… Read More

You might think we are crazy for going long a stock that has posted revenue declines in 15 of the past 16 quarters — a stock that has also underperformed the S&P 500 by 24 percentage points over the past 52 weeks.  But we are. And we have good reason.  Both fundamentally and technically, Hewlett-Packard (NYSE: HPQ) appears to be on the verge of an important turnaround that should send shares significantly higher. For starters, HPQ is selling at a bargain-basement valuation compared to other tech stocks.  Its current P/E is 11.1 while the S&P 500 Information Technology Index trades… Read More

You might think we are crazy for going long a stock that has posted revenue declines in 15 of the past 16 quarters — a stock that has also underperformed the S&P 500 by 24 percentage points over the past 52 weeks.  But we are. And we have good reason.  Both fundamentally and technically, Hewlett-Packard (NYSE: HPQ) appears to be on the verge of an important turnaround that should send shares significantly higher. For starters, HPQ is selling at a bargain-basement valuation compared to other tech stocks.  Its current P/E is 11.1 while the S&P 500 Information Technology Index trades at 18.8 times earnings. And HPQ’s forward P/E of 7.3 is less than half that of its sector index. #-ad_banner-# If you argue that many fast-growing tech stocks like Apple (Nasdaq: AAPL) and Google (Nasdaq: GOOGL) skew the broader valuation, it should be pointed out that in the top 10 index weightings are several mature stalwarts like IBM (NYSE: IBM), Cisco Systems (Nasdaq: CSCO) and Intel (Nasdaq: INTC).  Plus, the valuation doesn’t just come through when looking at earnings. HPQ is currently trading for a price-to-sales (P/S) ratio of 0.48 versus a ratio of 3.1 for the Information Technology Index. Read More

As a trader, I usually look for companies that are home-run hitters in terms of earnings growth. But with great reward comes greater risk, and such companies can also strike out. In a panicky market like the current one, an earnings whiff can lead to a big drop in the stock’s price. At times like these, it can be better to go for the reliable company that consistently hits singles and doubles. Software company Synopsys (Nasdaq: SNPS) is just such a stock. It’s not flashy, but it is likely to move steadily higher, making it a great bet in uncertain… Read More

As a trader, I usually look for companies that are home-run hitters in terms of earnings growth. But with great reward comes greater risk, and such companies can also strike out. In a panicky market like the current one, an earnings whiff can lead to a big drop in the stock’s price. At times like these, it can be better to go for the reliable company that consistently hits singles and doubles. Software company Synopsys (Nasdaq: SNPS) is just such a stock. It’s not flashy, but it is likely to move steadily higher, making it a great bet in uncertain times. Synopsys has grown earning per share (EPS) at an average rate of nearly 13% a year for past five years. During that time, shares have steadily advanced, more than doubling in price. #-ad_banner-# Founded in 1986, Synopsys is currently the world’s 15th largest software company. It’s a world leader in electronic design automation software, which is used to design and analyze electronic systems such as printed circuit boards and integrated circuits, and semiconductor IP. It is also a leader in software quality and security testing. Its customers include manufacturers of advanced system on chip… Read More