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When market players were unsettled and pretty emotional during the "flash correction" of early February, many sold stocks and waited for signs of the all-clear.
Unfortunately, Mr. Market doesn't give you a lot of time to analyze all the news and data points, make up your mind, and get over your fear.
By the time the worst news is priced-in, he's already made some serious capitulation lows and is riding the value train to price-in rising earnings estimates in a strong economy.
After describing to my followers why the hidden "W" bottom may have already occurred -- and how it justified the visible "V" bottom that was in progress -- I focused on our purchases of Technology and Consumer stocks during the "flash correction" that were leading the charge higher: Alibaba, NVIDIA and Square.
And by the end of last week, the Nasdaq 100 had not only cleared most resistance levels, it had actually exceeded the Feb 2 highs, essentially reversing the correction.
The S&P index is following the Nasdaq strength with today's closure of the big Feb 2 gap down. This week, we should see the benchmark back above 2800 once the Powell Fed anxiety has disappeared.
What Else Looks Good?
Thankfully, we also held on to our Apple shares during all that "peak iPhone" pessimism and its rally back toward all-time highs is impressive, but not surprising. It's also certainly fueling the NDX.
And, one of our sleeper holdings is a little semiconductor maker called SMART Global Holdings. I call it the "lil Micron" because it makes memory and flash components and trades at a similar valuation on some metrics like P/E and PEG.
SMART trades at under 7 times this fiscal year's (ending in August) $5.00 EPS consensus.
But with only a $635 million market cap and an estimated $1.13 billion in sales this year, SGH trades at a price-to-sales multiple of just 0.56.
The behemoth of memory, Micron, trades at 1.77 times sales.
And while the David and Goliath of memory share a PEG (PE ratio vs. Growth rate) of 0.46, Micron's growth is expected to fall to flat next fiscal year (also beginning September) on both the top and bottom lines.
Meanwhile, SMART Global is expected to maintain mid-teens percentage growth for sales and profits. In my book, SGH could be the perfect add-on for a larger semi player.
Be sure to swing by TAZR Trader to find the best stocks with the best chart setups as the market swings to new highs.
Disclosure: I own shares of BABA, LRCX, NVDA, AAPL, SQ, SGH and TQQQ for the Zacks TAZR Trader portfolio.
Kevin Cook is a Senior Stock Strategist for Zacks Investment Research where he runs the TAZR Trader service. Click Follow Author above to receive his latest stock research and macro analysis.
Want more articles from this author? Go to Zacks.com on this article and click the FOLLOW AUTHOR button to get an email each time a new article is published.
Brian Bolan is a Stock Strategist for Zacks.com.
He runs Stocks Under $10 Investor service where he looks for low priced stocks that are seeing positive earnings estimate revisions. This popular service has seen some strong early returns and offers a free trial via the Zacks Ultimate service.
Brian also runs the brand new Zacks Game Changers where he looks for stocks that are disrupting their industries and reaping big gains.
Looking for Ideas with Even Greater Upside?
Today's investment ideas are short-term, directly based on our proven 1 to 3 month indicator. In addition, I invite you to consider our long-term opportunities. These rare trades look to start fast with strong Zacks Ranks, but carry through with double and triple-digit profit potential. Starting now, you can look inside our home run, value, and stocks under $10 portfolios, plus more. Click here for a peek at this private information>>
Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.
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Zacks Investment Ideas feature highlights: Alibaba, NVIDIA, Square, Apple and SMART Global Holdings
For Immediate Release
Chicago, IL – Feb 27, 2018 – Today, Zacks Investment Ideas feature highlights Features: Alibaba (BABA - Free Report) , NVIDIA (NVDA - Free Report) , Square (SQ - Free Report) , Apple (AAPL - Free Report) and SMART Global Holdings (SGH - Free Report) .
Bull Train Has Left the Station
Last week, many market players were still quoting that tired, useless, fence-sitting aphorism "we're not out of the woods yet."
Here's what I wrote in Best Charts of the Bounce...
When market players were unsettled and pretty emotional during the "flash correction" of early February, many sold stocks and waited for signs of the all-clear.
Unfortunately, Mr. Market doesn't give you a lot of time to analyze all the news and data points, make up your mind, and get over your fear.
By the time the worst news is priced-in, he's already made some serious capitulation lows and is riding the value train to price-in rising earnings estimates in a strong economy.
After describing to my followers why the hidden "W" bottom may have already occurred -- and how it justified the visible "V" bottom that was in progress -- I focused on our purchases of Technology and Consumer stocks during the "flash correction" that were leading the charge higher: Alibaba, NVIDIA and Square.
And by the end of last week, the Nasdaq 100 had not only cleared most resistance levels, it had actually exceeded the Feb 2 highs, essentially reversing the correction.
The S&P index is following the Nasdaq strength with today's closure of the big Feb 2 gap down. This week, we should see the benchmark back above 2800 once the Powell Fed anxiety has disappeared.
What Else Looks Good?
Thankfully, we also held on to our Apple shares during all that "peak iPhone" pessimism and its rally back toward all-time highs is impressive, but not surprising. It's also certainly fueling the NDX.
And, one of our sleeper holdings is a little semiconductor maker called SMART Global Holdings. I call it the "lil Micron" because it makes memory and flash components and trades at a similar valuation on some metrics like P/E and PEG.
SMART trades at under 7 times this fiscal year's (ending in August) $5.00 EPS consensus.
But with only a $635 million market cap and an estimated $1.13 billion in sales this year, SGH trades at a price-to-sales multiple of just 0.56.
The behemoth of memory, Micron, trades at 1.77 times sales.
And while the David and Goliath of memory share a PEG (PE ratio vs. Growth rate) of 0.46, Micron's growth is expected to fall to flat next fiscal year (also beginning September) on both the top and bottom lines.
Meanwhile, SMART Global is expected to maintain mid-teens percentage growth for sales and profits. In my book, SGH could be the perfect add-on for a larger semi player.
Be sure to swing by TAZR Trader to find the best stocks with the best chart setups as the market swings to new highs.
Disclosure: I own shares of BABA, LRCX, NVDA, AAPL, SQ, SGH and TQQQ for the Zacks TAZR Trader portfolio.
Kevin Cook is a Senior Stock Strategist for Zacks Investment Research where he runs the TAZR Trader service. Click Follow Author above to receive his latest stock research and macro analysis.
Be sure to follow me on Twitter: @BBolan1
Want more articles from this author? Go to Zacks.com on this article and click the FOLLOW AUTHOR button to get an email each time a new article is published.
Brian Bolan is a Stock Strategist for Zacks.com.
He runs Stocks Under $10 Investor service where he looks for low priced stocks that are seeing positive earnings estimate revisions. This popular service has seen some strong early returns and offers a free trial via the Zacks Ultimate service.
Brian also runs the brand new Zacks Game Changers where he looks for stocks that are disrupting their industries and reaping big gains.
Looking for Ideas with Even Greater Upside?
Today's investment ideas are short-term, directly based on our proven 1 to 3 month indicator. In addition, I invite you to consider our long-term opportunities. These rare trades look to start fast with strong Zacks Ranks, but carry through with double and triple-digit profit potential. Starting now, you can look inside our home run, value, and stocks under $10 portfolios, plus more. Click here for a peek at this private information>>
Follow us on Twitter: https://twitter.com/ZacksResearch
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Zacks Investment Research is under common control with affiliated entities (including a broker-dealer and an investment adviser), which may engage in transactions involving the foregoing securities for the clients of such affiliates.
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Past performance is no guarantee of future results. Inherent in any investment is the potential for loss. This material is being provided for informational purposes only and nothing herein constitutes investment, legal, accounting or tax advice, or a recommendation to buy, sell or hold a security. No recommendation or advice is being given as to whether any investment is suitable for a particular investor. It should not be assumed that any investments in securities, companies, sectors or markets identified and described were or will be profitable. All information is current as of the date of herein and is subject to change without notice. Any views or opinions expressed may not reflect those of the firm as a whole. Zacks Investment Research does not engage in investment banking, market making or asset management activities of any securities. These returns are from hypothetical portfolios consisting of stocks with Zacks Rank = 1 that were rebalanced monthly with zero transaction costs. These are not the returns of actual portfolios of stocks. The S&P 500 is an unmanaged index. Visit https://www.zacks.com/performance for information about the performance numbers displayed in this press release.