Based on a lot of the talk these days about people’s moviegoing habits, you might get the impression the cinema industry is barely surviving. #-ad_banner-#Granted, the industry’s best days may be behind it, thanks to hot competition from the many on-demand forms of video entertainment now available like Netflix (Nasdaq: NFLX), Roku (which may be going public sometime this year), tablets and mobile devices. But cinemas are far from dead. In fact, the industry is still growing — and quite briskly in some parts of the world. Growth in the mature U.S. market will probably remain tepid, though, with industrywide… Read More

Based on a lot of the talk these days about people’s moviegoing habits, you might get the impression the cinema industry is barely surviving. #-ad_banner-#Granted, the industry’s best days may be behind it, thanks to hot competition from the many on-demand forms of video entertainment now available like Netflix (Nasdaq: NFLX), Roku (which may be going public sometime this year), tablets and mobile devices. But cinemas are far from dead. In fact, the industry is still growing — and quite briskly in some parts of the world. Growth in the mature U.S. market will probably remain tepid, though, with industrywide revenue expansion of 2.3% in 2014, projects Australian research firm IBISWorld. That’s a touch slower than the 2.5% growth rate of 2011 through 2013. Latin America, on the other hand, has an especially robust movie theater industry with annual revenue growth in the 8% range. What’s more, this region should see much better growth at the box office for years because its middle class is expanding. As overall prosperity keeps rising, even more Latin Americans should be able to afford regular trips to the movies. This presents a particularly good chance at profits for one movie theater company with large… Read More

I bet most investors, even risk-tolerant ones, would be fibbing if they said they weren’t nervous at all right now. #-ad_banner-#With so many top analysts, economists and money managers saying we’re due for a big correction or extended rough patch in stocks, who wouldn’t be at least a little jumpy? (I am, and I have very high risk tolerance.) With plenty of fear to go around, many investors probably wouldn’t mind injecting a good dose of safety into their portfolios — something a lot more conservative but still able to earn a decent return. With interest rates so low, cash,… Read More

I bet most investors, even risk-tolerant ones, would be fibbing if they said they weren’t nervous at all right now. #-ad_banner-#With so many top analysts, economists and money managers saying we’re due for a big correction or extended rough patch in stocks, who wouldn’t be at least a little jumpy? (I am, and I have very high risk tolerance.) With plenty of fear to go around, many investors probably wouldn’t mind injecting a good dose of safety into their portfolios — something a lot more conservative but still able to earn a decent return. With interest rates so low, cash, CDs and bonds won’t do — not on their own, anyway. Certainly, it’s necessary to have at least some exposure to stocks, but how much? And to what kinds? For instance, should there be exposure to foreign stocks, or are these too risky? What ratio of fixed-income and cash is appropriate? Clearly, investors seeking greater safety have many questions to consider. Fortunately, I’ve found an investment — an exchange-traded fund (ETF) — that I think has all the answers. This ETF hasn’t been around that long but plenty long enough to prove its mettle, in my opinion. In fact, a… Read More

At the height of his fame, one of history’s top investors, Peter Lynch, regularly marveled at how often one good stock could lead to another in the same industry. And that’s just what happened to me recently while reading up on one of my own holdings, Toyota (NYSE: TM). #-ad_banner-#This other “automobile stock” isn’t a household name like Toyota, but maybe it should be. It’s up about 135% in the past 12 months. And it still has plenty of attractive upside left to offer. One reason I believe this: The company has very robust sales, which have been climbing more… Read More

At the height of his fame, one of history’s top investors, Peter Lynch, regularly marveled at how often one good stock could lead to another in the same industry. And that’s just what happened to me recently while reading up on one of my own holdings, Toyota (NYSE: TM). #-ad_banner-#This other “automobile stock” isn’t a household name like Toyota, but maybe it should be. It’s up about 135% in the past 12 months. And it still has plenty of attractive upside left to offer. One reason I believe this: The company has very robust sales, which have been climbing more than 10% a year, from $2.9 billion in 2009 to $4.3 billion last year. Also, the firm’s earnings per share (EPS) growth has been rallying strongly since the nasty $7.19-a-share loss of 2009, when the recession was really raging. Now that the auto industry is on a roll again, consensus estimates are for EPS to rise 24% a year to $6.63 in 2019 from the current $2.26. However, this “auto stock” could earn $1,000 a share and still never threaten Toyota’s position as the world’s #1 automaker. Indeed, the company hasn’t sold one car in its 35-year existence. That’s because… Read More

For some investors, the best companies are the ones that succeed while “flying under the radar.” #-ad_banner-#That is, they generate attractive profits away from the limelight without the constant scrutiny of highly publicized firms like Apple (Nasdaq: AAPL), Facebook (Nasdaq: FB), Green Mountain Coffee Roasters (Nasdaq: GMCR), and others. While ‘famous’ companies such as these can make big money for shareholders, owning their stocks can be extra stressful. They’re often in the news and everybody has a different opinion about them. It’s enough to get any investor second-guessing the decision to invest in them. I wouldn’t shun these stocks completely,… Read More

For some investors, the best companies are the ones that succeed while “flying under the radar.” #-ad_banner-#That is, they generate attractive profits away from the limelight without the constant scrutiny of highly publicized firms like Apple (Nasdaq: AAPL), Facebook (Nasdaq: FB), Green Mountain Coffee Roasters (Nasdaq: GMCR), and others. While ‘famous’ companies such as these can make big money for shareholders, owning their stocks can be extra stressful. They’re often in the news and everybody has a different opinion about them. It’s enough to get any investor second-guessing the decision to invest in them. I wouldn’t shun these stocks completely, but it certainly isn’t necessary to have a portfolio full of them. There are plenty of under-the-radar stocks doing just as well or better without all the hype. One great example is a fast-growing airline stock you may never even have heard of if you don’t live on the West Coast. The stock’s up 65% in the past 12 months and 155% in the past three years. If you compare the financial performance of this nimble, regionally focused mid-cap to the industry averages, it’s well ahead in virtually every key growth and profitability measure. What’s more, it carries only a… Read More

Nothing feels worse for investors than missing the boat, and I’m sure there’s plenty of regret to go around these days. Stung by huge losses during the financial crisis, so many investors abandoned equities completely and stayed on the sidelines during what has been one of the most impressive stock market rebounds in decades. #-ad_banner-#But one of the things I’ve always liked about the stock market is it usually gives lots of second chances. They come in the form of corrections, declines of 10% or more.  Like many market watchers (like my colleague David Sterman, who gave his macroeconomic outlook… Read More

Nothing feels worse for investors than missing the boat, and I’m sure there’s plenty of regret to go around these days. Stung by huge losses during the financial crisis, so many investors abandoned equities completely and stayed on the sidelines during what has been one of the most impressive stock market rebounds in decades. #-ad_banner-#But one of the things I’ve always liked about the stock market is it usually gives lots of second chances. They come in the form of corrections, declines of 10% or more.  Like many market watchers (like my colleague David Sterman, who gave his macroeconomic outlook earlier this month), I strongly suspect we’re overdue for a correction because of things like overblown price-to-earnings (P/E) ratios, ongoing economic uncertainty domestically and abroad, and continued investor skittishness. Plus, the market has been showing the kind of increased volatility it often displays right before a major pullback. If the market does undergo a correction, I encourage investors to see it as a second chance — possibly a really good one — to get back into equities. With the level of mistrust in the stock market still so high, a typical sell-off could easily turn into a major rout. Indeed,… Read More

Because of the big losses they suffered during the recession, many investors remain wary of stocks — especially European ones.  #-ad_banner-#After all, Europe’s most recent debt crisis is probably fresher in people’s minds since it peaked more recently — in 2012, compared with 2008 and 2009 for the U.S. What’s more, European stocks have badly lagged the U.S. market for years. So why even consider them? Because they’re set to deliver attractive returns going forward. One major sign of this was the eurozone’s official emergence from recession last summer, when GDP estimates indicated Europe’s economy collectively expanded 0.2%… Read More

Because of the big losses they suffered during the recession, many investors remain wary of stocks — especially European ones.  #-ad_banner-#After all, Europe’s most recent debt crisis is probably fresher in people’s minds since it peaked more recently — in 2012, compared with 2008 and 2009 for the U.S. What’s more, European stocks have badly lagged the U.S. market for years. So why even consider them? Because they’re set to deliver attractive returns going forward. One major sign of this was the eurozone’s official emergence from recession last summer, when GDP estimates indicated Europe’s economy collectively expanded 0.2% in the second quarter of 2013. It has managed to maintain a similar pace of growth since then. There have been other signs of progress, too, like rising retail sales, rebounding factory orders, and falling bond yields in the weakest areas such as Italy and Spain. Importantly, the labor market appears to be stabilizing (though overall unemployment is still quite high near 12%). There’s also more optimism in one particularly well-informed group — business executives — as measured by the European Commission’s Economic Sentiment Indicator. As of Jan. 31, it stood at 100.9 — up more than 10% since last… Read More

This year is already a sharp contrast to 2013, when the overall stock market rose an impressive 32%. Following the recent pullbacks, the market only needs to shed about 5% more to meet the widely accepted definition of a correction (a decline of at least 10%).#-ad_banner-# It has been a while since stock investors have had to endure such pain, so further sell-offs may prompt many to seek safer havens — especially if a full-on correction materializes soon. Since bonds don’t generally offer much in the way of returns right now, investors who want to dial back risk… Read More

This year is already a sharp contrast to 2013, when the overall stock market rose an impressive 32%. Following the recent pullbacks, the market only needs to shed about 5% more to meet the widely accepted definition of a correction (a decline of at least 10%).#-ad_banner-# It has been a while since stock investors have had to endure such pain, so further sell-offs may prompt many to seek safer havens — especially if a full-on correction materializes soon. Since bonds don’t generally offer much in the way of returns right now, investors who want to dial back risk but still make money should consider top-flight large-cap stocks with attractive yields. You might think they’d be hard to find after the market’s long run-up, but they’re available — right under our noses, really. To spot them, just scan the list of stocks in the Dow Jones Industrial Average. You’ll quickly see the index’s top five dividend payers all have generous yields in the 4% to 6% range. And you should be able to count on them for attractive payouts for years to come. Read More

When companies are set to go public, investors are often abuzz with anticipation. But not all initial public offerings (IPOs) are greeted with enthusiasm. #-ad_banner-# A decade ago, for example, more than one analyst expressed doubt about the IPO of one well-known company. High leverage and operational inefficiency made the stock dubious at best, they warned. The stock was volatile right off the bat, dropping 24% in its IPO year of 2004 and then rising 27% in 2005. Then the market began consistently punishing the company for its heavy debt, cumbersome business model and faltering profits, sending shares down 2%… Read More

When companies are set to go public, investors are often abuzz with anticipation. But not all initial public offerings (IPOs) are greeted with enthusiasm. #-ad_banner-# A decade ago, for example, more than one analyst expressed doubt about the IPO of one well-known company. High leverage and operational inefficiency made the stock dubious at best, they warned. The stock was volatile right off the bat, dropping 24% in its IPO year of 2004 and then rising 27% in 2005. Then the market began consistently punishing the company for its heavy debt, cumbersome business model and faltering profits, sending shares down 2% in 2006 and 19% in 2007. With the added weight of the financial crisis, the stock sank 83% in 2008. Just four years after debuting at about $27 per share, this stock was hitting lows in the $1.40 to $2 range. Well, things are a whole lot different now. The stock has staged one of the most impressive comebacks of the past half decade, soaring 1,960% since the beginning of 2009. It now trades above $70 a share. This would have impossible if the firm, automotive parts supplier TRW Automotive (NYSE: TRW), hadn’t slashed debt and stayed focused on restructuring… Read More

It’s no secret that Americans are pretty voracious consumers of health care. #-ad_banner-#Health care accounts for more than 17% of GDP, and the sector is projected to grow to 20% of the U.S. economy within eight years. A good chunk of the sector is diagnostic laboratory testing, now about a $60 billion industry in the U.S. Currently, hospitals and health care networks do most lab tests, ranging from routine blood and urine screens to more time-consuming, complex cancer and genetic tests. However, health care providers are now much more likely to outsource lab tests, particularly the more complicated ones, because… Read More

It’s no secret that Americans are pretty voracious consumers of health care. #-ad_banner-#Health care accounts for more than 17% of GDP, and the sector is projected to grow to 20% of the U.S. economy within eight years. A good chunk of the sector is diagnostic laboratory testing, now about a $60 billion industry in the U.S. Currently, hospitals and health care networks do most lab tests, ranging from routine blood and urine screens to more time-consuming, complex cancer and genetic tests. However, health care providers are now much more likely to outsource lab tests, particularly the more complicated ones, because it’s often cheaper and more efficient. Typically, health care providers want a large, reputable lab with many accessible locations. They certainly prefer a lab that can handle volume that is likely to grow substantially, thanks to the Affordable Care Act (aka Obamacare). Obamacare, which emphasizes preventive testing, is expected to bring an estimated 25 million new patients into the health care system during the next 10 years. What’s more, the enormous baby boom population will likely need all sorts of diagnostic tests as they age. (My colleague Joseph Hogue explored this trend in his “Graying of America” series last summer.)… Read More

A few months ago, my colleague Dave Goodboy examined the risks and rewards of what he called “the financial world’s Super Bowl”  — initial public offerings, or IPOs.#-ad_banner-# Because IPOs can be so risky, he recommended investing in them with an exchange-traded fund (ETF). He also described his favorite ETF for the job, the First Trust U.S. IPO Index Fund (NYSE: FPX). I also think ETFs are the best way to play the exciting IPO market, but there’s another option that became available right around the time of Dave’s article. I thought investors… Read More

A few months ago, my colleague Dave Goodboy examined the risks and rewards of what he called “the financial world’s Super Bowl”  — initial public offerings, or IPOs.#-ad_banner-# Because IPOs can be so risky, he recommended investing in them with an exchange-traded fund (ETF). He also described his favorite ETF for the job, the First Trust U.S. IPO Index Fund (NYSE: FPX). I also think ETFs are the best way to play the exciting IPO market, but there’s another option that became available right around the time of Dave’s article. I thought investors should know about it because it provides broad exposure to IPOs and can be a great complement to FPX. This newer ETF complements FPX in a couple of ways. First, it focuses a lot more on small and midsize companies, like data analysis software firm Splunk (Nasdaq: SPLK) and payment processing technology provider Vantiv (Nasdaq: VNTV) — two stocks that are among the newer ETF’s top 10 holdings. (By the way, both have been hot, climbing nearly 40% and 20%, respectively, since the newer fund’s launch last October.) Another way the newer ETF can complement FPX is through sector diversification. Read More