Investors have been fickle this year. Before the New Year’s confetti had even settled, the market was in full-blown retreat, with recession-resistant safe havens holding up well and economically sensitive cyclicals bearing the brunt of the correction. Commodity stocks, for example, were clobbered. But since mid-February, market sentiment has shifted markedly toward sectors that would benefit from continued U.S. economic growth; commodities have rallied, too — a sign that investors now believe the gloomy forecasts of winter were overdone and spring may bring a rosier economic climate. For U.S. stocks, the shift toward growth was aided by attractive valuations for… Read More

Investors have been fickle this year. Before the New Year’s confetti had even settled, the market was in full-blown retreat, with recession-resistant safe havens holding up well and economically sensitive cyclicals bearing the brunt of the correction. Commodity stocks, for example, were clobbered. But since mid-February, market sentiment has shifted markedly toward sectors that would benefit from continued U.S. economic growth; commodities have rallied, too — a sign that investors now believe the gloomy forecasts of winter were overdone and spring may bring a rosier economic climate. For U.S. stocks, the shift toward growth was aided by attractive valuations for many fine companies unfairly caught up in the selloff. In many cases, those stocks are no longer cheap. But a careful perusal of the growth-stock catalog reveals that some excellent companies still trade at prices that make for attractive entry points. #-ad_banner-#One is Rockwell Automation (NYSE: ROK), which I recommended in early February. The stock is up about 14% since then, and not quite as cheap, but its valuation remains low enough to merit a buy for long-term investors. Rockwell Automation remains a beneficiary of the strong growth of the global robotics market. Robots now perform about 10% of all… Read More

With each economic report, it seems more certain that the U.S. economy is not teetering on the precipice but rather continuing to grow moderately, with a positive impact on consumer spending and corporate earnings. Not surprisingly, U.S. stock market volatility has decreased and investors are again comfortable taking on a little more risk in the form of smaller growth stocks. Here are two up-and-coming technology stocks to consider now: Proofpoint (Nasdaq: PFPT) is a small but fast-growing cybersecurity provider, a leader in the burgeoning “security as a service” industry, which provides cloud-based protection against hacking, phishing, malware and spam. Proofpoint’s… Read More

With each economic report, it seems more certain that the U.S. economy is not teetering on the precipice but rather continuing to grow moderately, with a positive impact on consumer spending and corporate earnings. Not surprisingly, U.S. stock market volatility has decreased and investors are again comfortable taking on a little more risk in the form of smaller growth stocks. Here are two up-and-coming technology stocks to consider now: Proofpoint (Nasdaq: PFPT) is a small but fast-growing cybersecurity provider, a leader in the burgeoning “security as a service” industry, which provides cloud-based protection against hacking, phishing, malware and spam. Proofpoint’s products protect messages, social media and data for enterprises and consumers. Improved security of sensitive information has been a huge priority of government and corporate organizations for years. It’s increasingly a concern for individuals as well — especially given the proliferation of so-called “ransomware” programs that shut down personal computers until an expensive repair software is purchased (from the scammer that sent the virus in the first place). #-ad_banner-#​Proofpoint’s innovative technologies, which include next-generation email security solutions, use encryption and other secure storage technologies to stymie outside attacks; their services include preventative threat intelligence and quick-response solutions to stop new… Read More

You wouldn’t know it from the headlines about obesity, but Americans spend a lot of time and money on fitness — and that spending is rising every year. The aging of America, which eventually could be a drag on the fitness segment as the Baby Boom population gets extremely old, is still a net positive: doctors increasingly insist that seniors stay active, driving demand for athletic shoes and apparel from folks well into their 70s. Spending on athletic and sports clothing rose about 13% from 2009 through 2014, for example — and faster-growing segments, such as women’s activewear, are booming. Read More

You wouldn’t know it from the headlines about obesity, but Americans spend a lot of time and money on fitness — and that spending is rising every year. The aging of America, which eventually could be a drag on the fitness segment as the Baby Boom population gets extremely old, is still a net positive: doctors increasingly insist that seniors stay active, driving demand for athletic shoes and apparel from folks well into their 70s. Spending on athletic and sports clothing rose about 13% from 2009 through 2014, for example — and faster-growing segments, such as women’s activewear, are booming. Here are two ways to play the trend: #-ad_banner-#​Foot Locker (NYSE: FL) is the world’s largest athletic-shoe retailer, with more than 3,400 stores in 23 countries as well as a robust online-retail business. In addition to its flagship brands (Foot Locker, Lady Foot Locker and Kids Foot Locker), Foot Locker operates under the Champs Sports, Footaction, SIX: 02, Runners Point, Sidestep and Eastbay brands. What’s remarkable about Foot Locker is that it’s growing so rapidly, 42 years after its founding. Sales are growing at 5% to 7% annual rate, thanks to annual increases in sales per square foot (a key… Read More

The rebound in U.S. stocks is being mirrored abroad, as global indices bounce back from sharp losses most of them endured in the early weeks of the year. Energy prices also are enjoying a resurgence. So the bargain stocks we picked up while they were down are already generating solid returns. But as the market continues to rally, it will be more important to continue to be selective when buying stocks. Valuations for shares of quality companies will rise beyond reasonable levels, and higher-valuation stocks are vulnerable to selloffs if sentiment again turns south. #-ad_banner-#One way to protect your portfolio… Read More

The rebound in U.S. stocks is being mirrored abroad, as global indices bounce back from sharp losses most of them endured in the early weeks of the year. Energy prices also are enjoying a resurgence. So the bargain stocks we picked up while they were down are already generating solid returns. But as the market continues to rally, it will be more important to continue to be selective when buying stocks. Valuations for shares of quality companies will rise beyond reasonable levels, and higher-valuation stocks are vulnerable to selloffs if sentiment again turns south. #-ad_banner-#One way to protect your portfolio while generating income is to look to stocks with above-average dividend yields. Income stocks are insulated somewhat from selloffs because as their share prices fall, their yields rise — creating a higher share-price floor as income investors move in. And with fears of a global economic slowdown still prevalent, few observers think the nightmare scenario for high-yielding stocks — a sharp rise in short-term interest rates — will come to pass in 2016. When looking at stocks with above-average yields, remember that the yield alone isn’t the only criterion. We also need to ask how safe the yield is, by… Read More

Last week, I examined mid-cap stocks and talked about why they’re a happy hunting ground for investors today. To summarize, investors have poured money back into U.S. stocks after the January swoon, as economic indicators are confirming that the U.S. economy remains on a growth path, with positive trends for employment and consumer spending, with low inflation and interest rates. It’s true that the global economic picture looks precarious, so we can’t be complacent about risk. But companies that generate all or most of their revenue in North America should be fine over the next few quarters. #-ad_banner-#In this environment, midsized… Read More

Last week, I examined mid-cap stocks and talked about why they’re a happy hunting ground for investors today. To summarize, investors have poured money back into U.S. stocks after the January swoon, as economic indicators are confirming that the U.S. economy remains on a growth path, with positive trends for employment and consumer spending, with low inflation and interest rates. It’s true that the global economic picture looks precarious, so we can’t be complacent about risk. But companies that generate all or most of their revenue in North America should be fine over the next few quarters. #-ad_banner-#In this environment, midsized companies stand a good chance to outperform expectations. The largest companies are safe havens in time of uncertainty, and many continue to look attractive. But as fears of a U.S. recession abate, the mid-cap sector could outperform — especially when it comes to attractively valued shares of companies catering to consumers. I told you about one such company earlier this week. Here are two more attractive targets in the mid-cap field: Lamar Advertising (Nasdaq: LAMR) specializes in outdoor advertising. If that phrase evokes billboards, you’re right — but Lamar, though more than a century old, is a leader in 21st… Read More

Investors seem to be warming back up to U.S. stocks, with good reason: despite growing nervousness about a global economic slowdown, our economic indicators continue to look relatively strong — confirming the view of many economists, and the Federal Reserve Board, that the fourth-quarter slowdown did not presage a U.S. recession. When jobs and consumer spending are on the rise while interest rates and inflation remain low, it’s time to look beyond the safer, high-quality stocks that looked attractive after the correction and focus on slightly more leveraged plays on the economy: mid-cap growth stocks. Midsized companies can grow more… Read More

Investors seem to be warming back up to U.S. stocks, with good reason: despite growing nervousness about a global economic slowdown, our economic indicators continue to look relatively strong — confirming the view of many economists, and the Federal Reserve Board, that the fourth-quarter slowdown did not presage a U.S. recession. When jobs and consumer spending are on the rise while interest rates and inflation remain low, it’s time to look beyond the safer, high-quality stocks that looked attractive after the correction and focus on slightly more leveraged plays on the economy: mid-cap growth stocks. Midsized companies can grow more impressively, because they are improving on a lower, usually less-diversified base of revenue and earnings, and they tend to be nimbler than large, mature companies — a huge asset in a time of dynamic change in almost every industry. #-ad_banner-#The S&P 400 Mid Cap Index dropped 11.4% from the beginning of 2016 through February 11 — a full-fledged correction. Since then, it’s rallied 11%, almost back to its end-of-year level. That’s a solid sign that investors are finding bargains among midsized companies and recognize that the economy is robust enough to support continued growth. Some caution is in order. Despite… Read More

Yesterday, I took a hard look at the recent performance of various sectors of the stock market. One area stood out: the construction & engineering sector — companies that build civil engineering projects, major commercial and industrial buildings and national infrastructure — is down about 13% over the past 12 months, but up 5.7% over the past month, a period during which the broad market rose less than 1%. Given the headline consensus that global economic growth is slowing, and that we may in fact be on the brink of a modest but real worldwide recession, why would shares of… Read More

Yesterday, I took a hard look at the recent performance of various sectors of the stock market. One area stood out: the construction & engineering sector — companies that build civil engineering projects, major commercial and industrial buildings and national infrastructure — is down about 13% over the past 12 months, but up 5.7% over the past month, a period during which the broad market rose less than 1%. Given the headline consensus that global economic growth is slowing, and that we may in fact be on the brink of a modest but real worldwide recession, why would shares of companies that rely on capital investment be rallying so sharply?  #-ad_banner-#Maybe investors in these companies are collectively wiser than the broad market’s conventional wisdom.  One reason for the sector’s rally was strong rebounds by a few stocks whose companies reported better-than-expected earnings. But that’s not the whole story. Across the board, investors are moving back into an area that seems vulnerable in the current climate. That’s a good sign that the market correction, while warranted somewhat by news from China, Brazil and OPEC, was an overreaction — and that investors realize that global demand for heavy infrastructure projects, particularly in… Read More

Last December in Paris, almost every country on Earth agreed to substantially reduce carbon emissions over the next decade, and to meet regularly to report on progress. Cynics can argue that the climate conference’s goals will never be met. But scientists are in lockstep about the urgency of action — and for the first time, a practical framework is in place, with everyone on board. #-ad_banner-#One of the major beneficiaries of government policies to reduce carbon emissions will be solar power. Electricity generation accounts for a huge chunk of carbon emissions, due to the prevalence of power plants that burn… Read More

Last December in Paris, almost every country on Earth agreed to substantially reduce carbon emissions over the next decade, and to meet regularly to report on progress. Cynics can argue that the climate conference’s goals will never be met. But scientists are in lockstep about the urgency of action — and for the first time, a practical framework is in place, with everyone on board. #-ad_banner-#One of the major beneficiaries of government policies to reduce carbon emissions will be solar power. Electricity generation accounts for a huge chunk of carbon emissions, due to the prevalence of power plants that burn coal and natural gas. Generating power from solar, wind, nuclear, hydro and geothermal sources produces little or no carbon emissions — so shifting from fossil fuels to alternatives is the easiest way to effect change. And even with natural gas at historically low prices, the relative cost of solar power is — for the first time — affordable for power plants to at least increase their mix of solar. And in large global economies still building out their power grid, such as India, solar will now be the power source of choice.  Solar received more good news in the budget… Read More

Phew! The stock market recently has calmed down after a highly volatile first six weeks of 2016. While we may not be out of the woods, the sky-is-falling panic seems to have been overblown. Let’s use this breather to review three recommendations from late last year and assess if they’re still worthy. Boeing (NYSE: BA), which I recommended in December, has fallen sharply since then, for two reasons. First, investors’ rising concerns about economic growth in China and India led them to dump Boeing, which expects strong demand for commercial aircraft from those countries for years to come. Second, the… Read More

Phew! The stock market recently has calmed down after a highly volatile first six weeks of 2016. While we may not be out of the woods, the sky-is-falling panic seems to have been overblown. Let’s use this breather to review three recommendations from late last year and assess if they’re still worthy. Boeing (NYSE: BA), which I recommended in December, has fallen sharply since then, for two reasons. First, investors’ rising concerns about economic growth in China and India led them to dump Boeing, which expects strong demand for commercial aircraft from those countries for years to come. Second, the U.S. Securities & Exchange Commission last week announced that it was looking into Boeing’s use of “program accounting” methods for its 747 and 787 Dreamliner lines. While the SEC may decide there’s no problem, the cloud cast over the company led to another selloff. #-ad_banner-#In my view, both issues are legitimate concerns, but ones to which the market overreacted. China and India are not in or near recessions; they remain in strong growth modes, albeit slower than expected. Their orders for commercial aircraft are booked years in advance and are not expected to slow considerably as a result of their… Read More

U.S. stocks are attempting to recover from their January swoon, albeit with high volatility and no shortage of down days. The correction may not be over, I’ve noticed some solid signs that indicate we might not be headed into an extended bear market. #-ad_banner-#One encouraging sign is the strong performance of consumer discretionary stocks. In contrast to consumer staples companies — the must-have-it products like food and toilet paper — consumer discretionary companies sell products and services that consumers can defer purchasing in uncertain times: cars, washing machines and amusement park tickets, to name a few. When investors fear a… Read More

U.S. stocks are attempting to recover from their January swoon, albeit with high volatility and no shortage of down days. The correction may not be over, I’ve noticed some solid signs that indicate we might not be headed into an extended bear market. #-ad_banner-#One encouraging sign is the strong performance of consumer discretionary stocks. In contrast to consumer staples companies — the must-have-it products like food and toilet paper — consumer discretionary companies sell products and services that consumers can defer purchasing in uncertain times: cars, washing machines and amusement park tickets, to name a few. When investors fear a recession, consumer staples stocks tend to outperform consumer discretionary stocks. But when the latter rally, it’s a strong sign that the consensus thinks the economy will be at least okay for the foreseeable future — and that consumers will have extra cash in their wallets. Currently, that seems to be the case — and for good reason. U.S. unemployment fell in January to 4.9%, an eight-year low. And average weekly earnings have risen 2.5% over the past 12 months. While not dramatic, it’s a notable improvement after years of stagnation. Employers across the country are reporting an increase in wage… Read More