Top War Stocks

by Fred Fuld III

No one likes a war. But no one likes their stock portfolio to drop during a war. One possible way of offsetting any portfolio losses during wartime is through stocks involved in the defense industry.

Many investors are morally opposed to owning stocks in companies that benefit from the manufacture of weapons, and that’s understandable. If that’s you, then this article is probably not for you.

With the chance of Russia and Ukraine going to war in the near future (or if they haven’t already by the time you read this article), many of the defense and weapons companies have had their stocks move up in price.

For example, Lockheed Martin (LMT) has increased by 4% over the last month. General Dynamics (GD) has moved up from 203 a share to above 216 per share, an increase of 6.4%.

If you are looking to get exposure in this industry, the following United States based defense related stocks all have trailing price to earnings ratios of less than 25, forward price to earnings ratios of less than 25, and a price to earnings growth ratio of less than 2.

Company Symbol Market Cap P/E Ratio
AAR Corp. AIR 1.53B 19
Aerojet Rocketdyne Holdings, Inc. AJRD 3.04B 22
Ducommun Incorporated DCO 552.99M 17
General Dynamics Corporation GD 59.81B 19
Huntington Ingalls Industries, Inc. HII 7.43B 14
Northrop Grumman Corporation NOC 62.06B 9
Textron Inc. TXT 15.13B 21
VirTra, Inc. VTSI 66.70M 13

Disclosure: Author didn’t own any of the above at the time the article was written 

Debt Free Stocks Below Cash per Share & Paying Dividends

by Fred Fuld III

It may be hard to believe that with so many stocks selling at recently very high levels, that there are actually stocks that not only sell below book value but also sell below cash per share. In addition, some of these stocks have little or no debt. Plus a few of these even pay dividends.

What selling below cash means is that if the company were to go out of business today, assuming the inventory, buildings, real estate, machinery, patents, and other assets were totally worthless, there would still be enough cash to distribute to all shareholders at an amount higher than the current stock price.

Here is a list of debt free stocks, selling below cash per share, and all have been paying dividends. .

Company Symbol Mkt Cap Yield Business
DallasNews DALN 35M 9.84% Publishing
Communications Systems JCS 25M 1.94% Tech
Eneti NETI 261M 0.59% Shipping
Retail Value RVI 66M 19.08% REIT

Just remember, these stocks are selling at a low price and have very low market caps for a reason, and are extremely speculative. In addition, high dividend payouts can be a red flag, and companies can stop paying dividends at any time.

No recommendations are expressed or implied. Do your own due diligence.

 

Disclosure: Author didn’t own any of the above at the time the article was written.

 

Top Travel Stocks Short Squeeze Plays

by Fred Fuld III

Many stocks in the travel industry have suffered during the last three years due to the COVID pandemic. Some have lost over 50% of their value since 2019. As the market prices for these stocks have dropped so much, now might be the time to look for short squeeze opportunities.

Here is a quick review about the short squeeze and its terminology. When you short a stock, it means that your goal is to make money from a drop in the price of a stock. Technically, what happens is that you borrow shares of a stock, sell those shares, then buy back those shares at a hopefully lower price so that those shares can be returned. This all happens electronically, so you don’t actually see all the borrowing and returning of shares; it just shows up on your screen as a negative number of shares.

Short selling can be profitable, but sometimes when the stock moves against the short sellers, and begins to rise, the short sellers jump in right away to buy shares to cover their positions, creating what is called a short squeeze. When a short squeeze takes place, it can cause the share prices to increase fast and furiously. Any good news can trigger the short squeeze.

Some traders utilize this situation by looking for stocks to buy that may have a potential short squeeze. Here is what a short squeeze trader should take into consideration:

Short Percentage of Float ~ The float is the number of freely tradable shares and the short percentage is the number of shares held short divided by the float. Amounts over 10% to 20% are considered high and potential short squeeze plays.

Short Ratio / Days to Cover / Short Interest Ratio -This is probably the most important metric when looking for short squeeze trades, no matter what you call it. This is the number of days it would take the short sellers to cover their position based on the average daily volume of shares traded. This is a significant ratio as it shows how “stuck” the short sellers are when they want to buy in their shares without driving up the price too much. Unfortunately for the shortsellers, the longer the number of days to cover, the bigger and longer the squeeze.

Short Percentage Increase ~ This is the percentage increase in in the number of short sellers from the previous month.

Check out the following list, but be aware, that often some stocks are heavily shorted for a reason. All these stocks have significant short metrics, but they have very low market caps and floats.

Company Symbol Days to Cover % of Float Shorted
Carnival Corporation & plc CCL 2 10%
Expedia Group, Inc. EXPE 2.9 5%
Lindblad Expeditions Holdings, Inc. LIND 23.9 19%
Norwegian Cruise Line Holdings Ltd. NCLH 1.6 10%
Royal Caribbean Cruises Ltd. RCL 2.9 6%
TripAdvisor, Inc. TRIP 4 12%

So as an example, Carnival has 10% of the float shorted, and it will take two days for the short sellers to cover their positions, based on the average daily volume.

Obviously, there is no guarantee that these stocks will go up, but if I was short any stock, I wouldn’t want to waste any time covering my position if the stock started to move up sharply, before all the other short sellers clamor in and drive the price way up.

Disclosure: Author has a short and long option position in CCL.

Stocks Going Ex Dividend in February 2022

The following is a short list of some of the many stocks going ex dividend during the next month.

Many traders and investors use the stock trading technique called ‘Buying Dividends,’ also commonly referred to as ‘Dividend Capture.’ This is the strategy of buying stocks before the ex dividend date and selling the stock shortly after the ex date at about the same price, yet still being entitled to the dividend.

This technique generally works in bull markets and flat or choppy markets, but you need to avoid the strategy during bear markets. In order to be entitled to the dividend, you have to buy the stock before the ex-dividend date, and you can’t sell the stock until after the ex date.

The actual dividend may not be paid for another few weeks. WallStreetNewsNetwork.com has compiled a downloadable and sortable list of the stocks going ex dividend in the near future. The list contains many dividend paying companies, lots with market caps over $500 million, and some with yields over 2%. Here are a few examples showing the stock symbol, the ex-dividend date, the periodic dividend amount.

Citigroup Inc. (C) 2/4/2022 0.51 3.13%
Schlumberger N.V. (SLB) 2/8/2022 0.125 1.28%
Starbucks Corporation (SBUX) 2/10/2022 0.49 1.99%
Amgen Inc. (AMGN) 2/14/2022 1.94 3.42%
Johnson & Johnson (JNJ) 2/18/2022 1.06 2.47%
Applied Materials, Inc. (AMAT) 2/22/2022 0.24 0.69%
Tyson Foods, Inc. (TSN) 2/28/2022 0.46 2.02%

The additional ex-dividend stocks can be found HERE . (If you have been to the page before, and the latest link doesn’t show up, you may have to empty your cache.) If you like dividend stocks, you should check out some of the other high yield stock lists at WSTNN.com HERE .

Dividend definitions:

Declaration date: the day that the company declares that there is going to be an upcoming dividend.

Ex-dividend date: the day on which if you buy the stock, you would not be entitled to that particular dividend; or the first day on which a shareholder can sell the shares and still be entitled to the dividend.

Record date: the day when you must be on the company’s books as a shareholder to receive the dividend. The ex-dividend date is normally set for stocks at two business days before the record date.

Payment date: the day on which the dividend payment is actually made, which can be as long at two months after the ex date.

Don’t forget to reconfirm the ex-dividend date with the company before implementing this technique.

Disclosure: Author did not own any of the above at the time the article was written; affiliate links are on this page.

Top Rare Earth Metals Stocks

by Fred Fuld III

Recently, Sen. Mark Kelly (D, AZ) co-sponsored a bi-partisan bill called the Restoring Essential Energy and Security Holdings Onshore for Rare Earths Act of 2022, which calls for the development of a strategic reserve of rare earth metals by the year 2025, and bans the use of Chinese rare earth metals by the U.S. military by the following year.

What is a Rare Earth Metal?

So what is a rare earth metal? Rare earth metals, also called rare earth elements or REE, are heavy metals used in numerous industrial applications, many of which are critical.

Where are Rare Earth Metals Used?

Such uses include magnets, catalysts, batteries, glass, metallurgy, polishing, pigments, and ceramics, with the primary industry users being military equipment and renewable energy technology.

The 17 Rare Earth Elements

The following are considered to be the rare earth elements:

Lanthanum
Cerium
Praseodymium
Neodymium
Promethium
Samarium
Europium
Gadolinium
Terbium
Dysprosium
Holmium
Erbium
Thulium
Ytterbium
Lutetium
Scandium
Yttrium

What Countries Produce Rare Earth Metals?

According to Statista, China produces over 57% of the earths rare-earth elements, with the United States in second place at 15.6%. Myanmar (Burma) is third at 12.3%, followed by Australia and Madagascar.

The Top Rare Earth Elements Stocks

The leading rare earth elements company in the United States is MP Materials (MP) with a market capitalization of $7 billion. The company is in the business of rare earth mining and processing, and owns the mineral rights to the Mountain Pass Mine and surrounding areas in Nevada. It produces neodymium and praseodymium.

The company trades at 59 times trailing earnings. Revenues for the latest reported quarter rose by 36% over the previous quarter, and net income increased by over 57%.

The other big producer of rare earth metals is Lynas Rare Earths (LYSCF) (LYSDY). This Australian based company mines, extracts, and processes rare earth minerals in Australia and Malaysia.

The stock has a trailing price to earnings ratio of 55.5 and the company has a market cap of $6.7 billion. Revenues for the latest reported year jumped by 61% over the previous year. Earnings went from negative $19 million to a positive $157 million during the same time period.

There are actually over two dozen companies involved in rare earth metals, including mining, processing, selling, and recycling. To see the list, click HERE.

You also have one other option, and that is VanEck Vectors Rare Earth/Strategic Metals ETF (REMX). This ETF invests in a diversified portfolio of companies involved in the mining, refining and recycling of rare earth and strategic metals and minerals.

Hopefully, these stocks may provide a rare opportunity for your portfolio.

 

Disclosure: Author owns MP.

These are the 18 books that Warren Buffett thinks you should read to get smarter about investing and trading

Warren Buffett, head of Berkshire Hathaway (BRKA) (BRKB), actually came out with a list of books that he recommends on how to trade stocks and invest.

If you are interested in reading books about how to invest and trade, that are recommended by Warren Buffett, they can be found on the list below:

Business Adventures Twelve Classic Tales from the World of Wall Street

Common Sense on Mutual Funds: Fully Updated 10th Anniversary Edition

The Great Crash 1929

The Intelligent Investor: The Definitive Book on Value Investing. A Book of Practical Counsel (Revised Edition)

Investing Between the Lines: How to Make Smarter Decisions By Decoding CEO Communications

Here are his recommended books about himself.

Berkshire Beyond Buffett: The Enduring Value of Values

 

Berkshire Hathaway Letters to Shareholders

 

50 Years of Berkshire Hathaway Wall Print
This is actually a wall print poster.

 

Buffet: The Making of an American Capitalist

 

Buffett’s Bites: The Essential Investor’s Guide to Warren Buffett’s Shareholder Letters

 

The Essays of Warren Buffett: Lessons for Corporate America, Fifth Edition

 

A Few Lessons for Investors and Managers From Warren Buffett

Here are more books that Warren Buffett recommends about himself.

My Warren Buffett Bible: A Short and Simple Guide to Rational Investing: 284 Quotes from the World’s Most Successful Investor

 

The Oracle & Omaha, How Warren Buffet and His Hometown Shaped Each Other

 

Tap Dancing to Work: Warren Buffett on Practically Everything, 1966-2013

 

Warren Buffett on Business: Principles from the Sage of Omaha

 

Warren Buffett’s Ground Rules: Words of Wisdom from the Partnership Letters of the World’s Greatest Investor

Warren Buffett Speaks: Wit and Wisdom from the World’s Greatest Investor

Enjoy your reading!!!

 

 

This page includes affiliate links.

How to Trade Agricultural Commodities without Trading Futures

by Fred Fuld III

Have you ever thought about trading or investing in an agricultural commodity, possibly as an inflation hedge, such as  wheat, corn, soybeans, or even coffee?

But maybe you didn’t want to get into futures because of the risk or lack of understanding or both.

Well, there is another way to trade these food items, and that is through the agricultural commodities exchange traded funds.

Probably the safest way is through an ETF that has a diversified portfolio of agricultural products, such as the Invesco DB Agriculture Fund (DBA), which has an investment objective of investing in a portfolio of exchange-traded agricultural futures.

If you think the price of corn is going to take off, you could trade the Teucrium Corn Fund (CORN).

Or maybe you think the demand for sugar is going to increase, causing the sugar price to spike. You have a couple of alternatives, the iPath Series B Bloomberg Sugar Subindex Total Return ETN (SGG) and the Teucrium Sugar Fund (CANE).

If you like chocolate, there is the iPath Bloomberg Cocoa Subindex Total Return ETN (NIB).

The following is a list of the agricultural commodities ETFs.

Commodity Symbol ETF Name  Total Assets*
Agriculture DBA Invesco DB Agriculture Fund  1,018,170
Agriculture RJA Elements Rogers International Commodity Index-Agriculture Total Return ETN  153,758
Corn CORN Teucrium Corn Fund  120,848
Coffee JO iPath Series B Bloomberg Coffee Subindex Total Return ETN  94,895
Wheat WEAT Teucrium Wheat Fund  75,645
Soybean SOYB Teucrium Soybean Fund  44,971
Sugar SGG iPath Series B Bloomberg Sugar Subindex Total Return ETN  26,419
Sugar CANE Teucrium Sugar Fund  22,844
Cocoa NIB iPath Bloomberg Cocoa Subindex Total Return ETN  22,713
Grains JJG iPath Series B Bloomberg Grains Subindex Total Return ETN  21,563
Cotton BAL iPath Series B Bloomberg Cotton Subindex Total Return ETN  20,602
Livestock COW iPath Series B Bloomberg Livestock Subindex Total Return ETN  19,665
Agriculture TAGS Teucrium Agricultural Fund  14,180
Agriculture JJA iPath Series B Bloomberg Agriculture Subindex Total Return ETN  11,211
* In thousands

You will notice that some of these are ETNs (Exchange Traded Notes) as opposed to ETFs. ETNs are senior, unsecured debt securities similar to a bond

Keep in mind that these funds are very volatile, very speculative, and can have low volume and very wide spreads.

 

Disclosure: Author is long JO and WEAT.

How Did the Meme Stocks Do Last Year? Here’s How

by Fred Fuld III

About a week ago, I heard an analyst on CNBC being interviewed about meme stocks, although he didn’t pronounce it “meeem”, he pronounced it “me-me”. Do you think it was accidental, through ignorance, or on purpose with a hidden meaning?

Whatever you call them, the meme stocks have had a wild ride last year. Surprisingly, a few of them performed extremely well, but many ended up dropping over 40% for the year.

Interestingly, the top performers were GameStock, I mean GameStop (GME) (did I type it that way accidentally or on purpose?), up 688%, and AMC Entertainment (AMC), which rose by 1183%.

The memes that tanked the most were Clovis (CLOV) down 78% and ContextLogic Inc. (WISH), which dropped by 83%.

The following is a list of the meme stocks and semi-meme stocks along with the January 1 to December 31 performance for the year 2021.

GME 688%
AMC 1183%
CLOV -78%
CRON -43%
DASH 4%
FVRR -42%
HOOD -49%
IQ -74%
OTLY -61%
WE -27%
WISH -83%
BB 41%
SNDL 22%
BYND -48%
SLV -12%

Maybe we will see some meme action again this year. What do you think?

 

Disclosure: Author owns SLV and HOOD.

Pitch Like Hollywood: What You Can Learn from the High-Stakes Film Industry

by Fred Fuld III
Editor & Publisher, Wall Street News Network

Have you ever had to negotiate with your boss about a pay raise, or try to raise money for your company, or interview for a job, or sell a product or service, or even ask someone for a date? If so, it means that you had to give a pitch.

The book, Pitch Like Hollywood: What You Can Learn from the High-Stakes Film Industry, by Peter Desberg and Jeffrey Davis, is all about pitches. The authors show how to create a pitch, how to prepare for a pitch, how to present your pitch, how to deal with pitch panic, and other strategies. This guide even tells you the best time of day to make a pitch.

The book is also useful for those who have to give speeches.

Don’t let the word “Hollywood” in the title deter you from reading this book. Examples from many different industries are included, such as aerospace, education, automobile, technology, advertising, and many others.

The most important aspect of this book that I liked the most was the extensive research and studies that were done to back up what the book presented.

My favorite chapter was Chapter 5 – Persuasion Bootcamp, where the authors present and describe all of the Compliance Gaining Techniques.

It doesn’t matter if you are the head of a startup, or working your way up the corporate ladder, or trying to promote your book to a publisher, or just trying to sell your products or services to a customer or client, I highly recommend Pitch Like Hollywood to anyone who is ever involved in persuasion.

 

 

 

Article includes affiliate links.