Today’s pick is what I like to call an “extreme growth stock.” It’s a pharmaceutical company seeing significant advances in sales and earnings with huge momentum. Shares are up nearly 150% in the past two years, and they look ready to move even higher in the weeks and months to come.  First, it’s part of a very strong group that continues to outperform. The pharmaceutical sector was hot in 2014, with iShares US Pharmaceuticals (NYSE: IHE) gaining 28.2% last year, more than double the S&P 500’s 11.4% rise. And just this month, IHE is up another 3.8% while… Read More

Today’s pick is what I like to call an “extreme growth stock.” It’s a pharmaceutical company seeing significant advances in sales and earnings with huge momentum. Shares are up nearly 150% in the past two years, and they look ready to move even higher in the weeks and months to come.  First, it’s part of a very strong group that continues to outperform. The pharmaceutical sector was hot in 2014, with iShares US Pharmaceuticals (NYSE: IHE) gaining 28.2% last year, more than double the S&P 500’s 11.4% rise. And just this month, IHE is up another 3.8% while the S&P 500 is down 2.5% year to date. #-ad_banner-# Second, the company has rock-solid fundamentals, largely due to its development and acquisition of numerous strong brands.  Although you may not have heard of Valeant Pharmaceuticals (NYSE: VRX), it’s a massive pharma company with a market cap over $50 billion. It manufactures branded drugs for the treatment of dermatological, neurological and oral health issues.  One of its most well-known drugs is Wellbutrin XL for the treatment of depression. Its over-the-counter brands… Read More

Small caps are typically expected to lead U.S. equities higher. In 2014, they shocked investors by underperforming their larger-cap counterparts. But a look at the charts shows they may make a comeback in 2015, and today I’ll share a little-known indicator that could predict the next big small-cap winner. #-ad_banner-#In 1992, Nobel Prize-winning economists Eugene Fama and Kenneth French published their seminal paper, “The Cross-Section of Expected Stock Returns.” They demonstrated that small-capitalization stocks tended to outperform large-capitalization stocks over time. This makes sense from a risk/reward standpoint. Small caps are fledgling companies, and… Read More

Small caps are typically expected to lead U.S. equities higher. In 2014, they shocked investors by underperforming their larger-cap counterparts. But a look at the charts shows they may make a comeback in 2015, and today I’ll share a little-known indicator that could predict the next big small-cap winner. #-ad_banner-#In 1992, Nobel Prize-winning economists Eugene Fama and Kenneth French published their seminal paper, “The Cross-Section of Expected Stock Returns.” They demonstrated that small-capitalization stocks tended to outperform large-capitalization stocks over time. This makes sense from a risk/reward standpoint. Small caps are fledgling companies, and their stocks are often illiquid compared to large caps. These two factors make them volatile — about 20% more so than the S&P 500. Those companies that do succeed offer large returns as they grow their market capitalizations through great products and services. They can become some of the corporate giants we see today. Apple (NASDAQ: AAPL), Microsoft (NASDAQ: MSFT) and Cisco (NASDAQ: CSCO) all started out as small-cap IPOs. In general, greater reward comes from assuming greater risk. And during market advances like we saw in 2014, small caps generally lead — expect… Read More

The U.S. stock market was the darling of the world in 2014. The trifecta of a strengthening economy, a stronger greenback and decreasing commodity prices helped drive U.S. corporate profits. Foreign and domestic money flowed into U.S. stocks, pushing the S&P 500 and Dow Jones Industrial Average to record highs. Read More