Kohl’s (KSS) earning surprise sent the stock higher last week. We take a look at the news coupled with a reading of the current stock chart and industry trend to get a sense of whether KSS is a stock worth putting on your investment radar.
Last week the GAP (GPS) reported an increase in June’s same-store monthly sales of 2%. This reversed a year long trend of reductions in monthly sales. As a result, the stock jumped nearly 5% from where it opened on Thursday to where it closed on Friday. Since early May, the GAP has being trending up, which is a much different picture from what the stock has shown for a long while.
Based on a brief technical analysis (illustrated in the chart below), if the overall market does not does not break to the negative, it would not be surprising to see the GAP continue to ‘melt up’ in the coming months.
Today saw an impressive positive surge in the S&P 500. It was significant because it put the market back at a peak it had not reached since over one year ago. This very positive news from a technical perspective and may lead to more buyers returning to the market in anticipation of new highs being set.
The chart below illustrates the breakout seen today from prior highs.
RV retailer Camping World is reported to be in the process of having an initial public offering (IPO). I see this is bullish for associated RV makers, such as Winnebago (WGO). I see the entry of Camping World to the market a helpful setup in order to provide options as a greater share of the population becomes warm to RV travel. Again, as I have said before, I see the Baby Boomers retiring as a trend that will benefit all RV manufacturers and sellers.
Keep Camping World’s IPO on your radar.
A few years ago Gaslog became a publicly traded company and debuted at around $12 per share. In less than a year and a half later the stock traded over $30 per share. Since that time the stock has been in an almost perpetual state of decline. This February it trade for under $6 per share.
Currently the stock trades for around $13.50 and has a dividend yield a little over 4% annually. As an international transporter of natural gas, the swings high and low in commodity prices can weigh heavily on the future success of the company. That’s a given. Putting fundamental analysis aside for the time being, I will call attention to the technical setup that we are seeing in the current chart for GLOG.
GLOG has advanced at a quite consistent rate since the February low it set. It has brought with it higher highs in a near-term analysis. What has caused this change? Well, look no further than the price change in natural gas (below). Actually, the NG spot price chart is to a degree a reflection of where GLOG was and where it is now. GLOG is a commodity driven business and investors are treating the stock just like the commodity is lives and dies by. If you’re bullish on natural gas and want some exposure to its potential to increase further, then GLOG is your ticket.
If you are working for a public institution, you likely have the ability to contribute to a 457 retirement plan. This plan can be thought of the relatively unknown sister of the widely known 403b plan. The major difference is that retirement is not defined as when you hit age 59.5, but when you separate service with your employer, then draws on the saved funds can be made without the 10% early withdraw penalty. The money you draw will be subject to ordinary income tax rates.
A 457 plan might make a lot of sense to you, if you have the opportunity to invest in one. Contribution limits mirror the 401k and 403b plans at 18,000 annually with catch up provision becoming available at age 50.
The bottom line is that the 457 plan gets you the same benefits of the 401k and 403b, but offers you the option of withdrawing the money, if the option of early retirement is in your plans.
Check with your employer to see what retirement account options are available.
In a world where the sort of ‘normal’ growth we experienced in the 80s, 90’s and most of the 00’s has disappeared, investors are now venturing further out into more obscure areas to find the growth of yesteryear. Often this means looking in places where exciting new technology is being developed. That’s valid, but it also carries more risk. Some emerging technologies boom and many bust. It’s the nature of the beast.
If you’re a growth minded investor that wants to keep the reins relatively tight on the risk monster, where do you go? It’s not an easy question given the economy’s lack luster recovery and future prospects. In times like these we need to turn to things that have a greater amount of certainty of happening. The old saying is that only two things are certain in life – death and taxes. You can’t argue with that. Yet, a number of other aspects of life are pretty certain, as well.
Father time is a tough cookie. He gets the better of all of us eventually. With age certain things tend to occur across the population. One is the reliance on a greater amount of prescription drugs. This is a consequence of greater ailments as we age. Our bodies, through the aging process and/or past events we’ve experienced, don’t function as well as they use to or we’d like them to. Therefore, drugs are provided in order to maintain some level of activity that we once new.
The giant demographic blimp known as the Baby Boomers are either near or in their retirement years. As each day passes, the likelihood of them hitting the prescription bottle becomes more and more likely. More users equals a bigger market and a lot easier growth environment for your pharmaceutical company.
Another fact of life is that if you stave off the reaper long enough, you’re going to find yourself in a state where you cannot take care of yourself on your own. Whether it is being in some form of senior living facility or having in-home care, assistance will be needed. This is a huge area of growth. Consider this, my grandparents are both in their 90’s. They both have a certain degree of assistance from caretakers. They have seven kids. If all seven replicate their longevity of life, the demand for assisted living services will increase by over 300%. The reason why the Baby Boom generation is such a handful for society is because families in this era were typically very large by today’s standards. Seven kids was not uncommon.
With better health habits and better healthcare, many Baby Boomer will outlive their parents. This means that this demographic wave will ride high until these members are in their 80’s and 90’s. Once at this point greater and greater demands will be put in assisted living facilities and service providers. Growth, which is already occurring, will balloon.
How do you position yourself to take advantage of these opportunities? First off, this isn’t something that is going to occur overnight. If I told you that you needed to go in the next month and load up on X, Y and Z stock, I would be an idiot. What we are facing is a lengthy trend that will gain significant momentum in the years ahead. This provides you with time to identify companies meeting the needs outlined above. In identifying them, think of those that are paying a dividend and have a record of increasing the dividend. This is a trend for the long haul and you want to be in companies that are going to reward you. A consistent dividend is good, a consistent divided that is growing is better.
Lastly, sit back and wait. Sell offs are great buying opportunities. We know a huge segment in our population is moving toward the age where drugs and assisted living are major wants and needs. If the need isn’t going away, then the industry is not going away. Be patient and wait for a good buying opportunity. When the time comes, then load up and wade into the positions you’ve identified.
It’s easier to run when the wind is at your back. Remember that the next time you’re out running and the next time you think about making an investment decision. One of the reasons Amazon is able to show strength at a time many of their competitors are struggling is that they have a number of drivers that cause a metaphorical wind to be at the company’s back. Need an illustration…here we go.
A big news story lately has been some insane idea that your gender identity should enable you to choose what restroom to use when out at a store or what locker room to change in, if I’m attending a school or part of a gym. I feel very confident saying that most people, especially those with kids, even more so with female kids, are pretty freaked out by this concept.
Just as a $15 minimum wage will push away lower skilled jobs that have an automated alternative, the thought of having some pervert in a bathroom your kid is using while at the store will push parents to opt for online shopping and home delivery. Most people do not get pleasure putting themselves through awkward and dangerous situations. If an alternative exists, they will choose the path that provides more comfort, even if a slight premium exists.
Amazon’s wide range of products and fast ordering speak directly to a society that is increasingly fragmented and polarized. They also are configured to serve higher wealth individuals. This group is not only in a better position to spend money on goods, but also generally has been predisposed to not want to submerge themselves with ‘the commoners’ at your regular retail establishments. The thought of pervert Bill frequenting the women’s restroom will push more people into the world of anti-brick and mortar shopping.
In the example above, I didn’t talk about the economy’s strength or buying trends, I talked about a political and social change that is pushing people to online shopping because they do not feel at ease with the direction our leaders are taking us. Amazon is the king of online retail and finds itself in a sweet spot.
A weak economy is not good for any retail establishment. In the short term, economic weakness has and may continue to take a backseat for an establishment like Amazon because other factors of change are playing to its benefit. The example provided is an external force that happens to be a benefit to Amazon and other online retail establishments. It’s only one factor and the truth is Amazon’s planning and strategy has led it to be able to take advantage of such a situation.
Never forget that social patterns do drive business success. Whether it’s where you are in your life (demographics), changes in society’s perceptions, or even geographic population shifts, all of these weigh heavily on economic dynamics and the ability for businesses to grow. Momentum is real.
Is it only me or does the constant wave of stock picks and ideas get old pretty darn fast? How can I listen to broadcasts where the host speaks of the impending crash of the market, then during the next segment speak of a stock that you should buy? Maybe I’m off base and the things I listen to are really for entertainment rather than education. It’s possible. Why would a show start with a disclaimer that nothing said should be taken as being investment advice, then go on for the remainder of the show and talk about investments and give advice? The only conclusion would be the show is for entertainment, correct?
The financial entertainment business is only going to grow in the next 10-20 years. Why? The wave of Baby Boomers that have or will be retiring in the not so distant future will have time on their hands and cash in their accounts. Rather than souls seeking redemption, they will be pensioners seeking yield. The financial evangelists on CNBC, Fox Business, Bloomberg and other outlets will preach the economic gospel according to Keynes, Hayek, Mises and Friedman, while they point the way to financial righteousness.
A lot of money has been wasted and a lot of money will continue to be wasted through the half baked advice of investment and financial commentators. A larger retired population with time and money will find their way to the screens and speakers where investment advice is broadcasted free and clear for all. The ideas will be imbibed and trades will be made. In some cases money will be made and in many other cases money will be lost.
At times it might be wise to invest in entertainment, but it is never wise to look to an entertainment venue for investment advice.