Tag Archives: CE

Top 5 Tech Stocks For 2019

The 10-year U.S. Treasury has crossed the rubicon. It is now flashing a yield that is over the 3% mark. What befalls the economy when that happens? Recession? Correction? A grinding bear market?

Nope. Nothing really. It is more a measure of inflation and economic growth, and far more psychological than it is a real indicator of something significant.

But the kernel of truth that it does represent is a new stage of growth in the economy. The big, safe stocks will keep chugging along, but smaller companies can grow faster than big ones in a faster-paced economy.

That means asset managers — and smart individual investors — will start moving money into small- and mid-cap stocks to take advantage of accelerating growth.

Below are 10 little-known stocks that could be huge in coming years, and now is a good time to establish a foothold, while they’re still cheap and relatively undiscovered. Just remember, these stocks will be volatile, so don’t expect a smooth ride.

Top 5 Tech Stocks For 2019: Apple Inc.(AAPL)

It might be tempting to think that the iPhone is Apple’s swan song and dismiss the company as a has-been, and many investors have long predicted just that. Some have even foretold the death of the iPhone 10, but that ignores the reality.

In the recent earnings release, Apple reported second-quarter records for both revenue and earnings, and Apple CEO Tim Cook said "Customers chose iPhone X more than any other iPhone each week in the March quarter, just as they did following its launch in the December quarter." The company set all-time record sales from the App Store, Apple Music, iCloud, and Apple Pay. The company will likely achieve Cook’s goal of doubling revenue from Apple’s services segment by 2020.

Berkshire Hathaway CEO Warren Buffett, one of the world’s most followed investors, signaled his faith in the company when it was revealed that he had purchased a massive 75 million Apple shares over the past quarter, in addition to the 165 million shares already owned, increasing his stake in the iPhone maker to about 5% of the company’s shares.

Buffett scoffed at the thought of grading the company based on how many phones it sold in a quarter, saying:

Nobody buys a farm based on whether they think it’s going to rain next year or not. They buy it because they think it’s a good investment over 10 or 20 years … The idea of spending loads of time trying to guess how many iPhone X … are going to be sold in a given three month period, to me, it totally misses the point. 

This is a clear indication that Buffet believes that Apple will be a solid investment for decades.

Other reasons to like the company abound. The company raised its quarterly dividend by 16% to $0.73 per share, which is funded by less than 25% of Apple’s profits. The company also announced a new $100 billion share buyback. At current prices, this could reduce Apple’s share count by an additional 10%.

iPhone 8 and iPhone 8 Plus (Product) Red Special Edition.

IMAGE SOURCE: APPLE.

Finally, there’s Apple’s valuation. Even after the stock’s recent run-up, it sells for just 18 times trailing earnings, far below the 25 times for the S&P 500.

A compelling valuation, a solid and growing dividend, significant share buybacks and record-setting results all show why Apple is positioned to grow for the next 50 years.

But don’t take our word for it. Ask Warren Buffett.

Top 5 Tech Stocks For 2019: Hewlett Packard Enterprise Company(HPE)

Hewlett Packard Enterprise is an integrated systems company focused on enterprise offerings like IT solutions, servers, and cloud-based products. The old Hewlett Packard Company might have been more of a “blue chip” by definition, but the spinoff has created new efficiencies for HPE, and investors are getting on board with this Zacks Rank #2 (Buy) stock right now.

HPE currently sports a “B” grade for Value in our Style Scores System, and its P/E, PEG, and P/B ratios all trade at significant discounts compared to its industry. Analysts are also calling for HPE to post EPS growth of 46% in the current fiscal year, and its latest estimates have been trending higher.

Top 5 Tech Stocks For 2019: Mastech Holdings, Inc(MHH)

Little-Known Stocks to Buy: Mastech Digital (MHH)

Source: Shutterstock

 

Mastech Digital Inc (NYSEAMERICAN:MHH) is up 67% year to date and has a market cap of a mere $92 million.

MHH is a 21st century version of a temp firm. It’s a temp firm to IT personnel.

The thing is, millennials and Gen Zers are not looking to be the kind of 9-5 employees that previous generations considered the way to go about a career position.

Coders, devs, systems admins, etc. don’t see systems in a 9-5 world. The tech world is 24/7, so when they work is more flexible and not as predictable. They work around the tech. And that makes Mastech a great draw for talent as well as clients. Plus, many of these jobs are high paying, so Mastech has great margins, since it’s not trying to sell desk jockeys or maintenance workers.

Top 5 Tech Stocks For 2019: Celanese Corporation(CE)

Celanese shares were booming as the company unveiled strong quarterly results.

The company said that for its first quarter, earnings came in at $2.68 per share, or $2.79 per share on an adjusted basis. Analysts were calling for adjusted earnings of 48 cents per share.

From a revenue standpoint, Celanese also impressed, bringing in $1.85 billion for its first quarter, marking a 26% increase compared to the year-ago period. The Wall Street consensus estimate projected revenue of $1.66 billion.

The company’s Engineered Materials segment posted net sales of $665 million for the period, 29% higher than in the year-ago quarter. Both GAAP operating profit of $127 million and segment income of $182 million were all-time highs.

“The on-going success in our businesses gives us confidence that we can grow adjusted earnings per share by 20-25 percent in 2018,” said Mark Rohr, Celanese chairman and CEO.

CE stock was up about 5.7% after the bell today.

Top 5 Tech Stocks For 2019: Buckle, Inc. (BKE)

Even in a sector filled with concerns, and despite having over $4 per share on the balance sheet, Buckle Inc (NYSE:BKE) looks like one of the riskiest plays in retail.

The company is heavily exposed to the tough mall space, with 84% of its locations in shopping malls, per figures from the 10-K. Revenue and earnings are headed in the wrong direction. And as a result, shorts have targeted the stock. A whopping one-third of the float (though closer to 21% of shares outstanding) is sold short at the moment.

With BKE now having more than doubled from its 52-week low, the stock looks dangerous from here, particularly ahead of Q1 earnings this month. But for investors who see the retail sector as oversold, those characteristics all make BKE an intriguing play at this point. A strong Q1 report could squeeze those shorts. Easy comparisons could help growth this year.

And even after the gains over the past year, BKE remains cheap. Backing out its cash, it trades at about 11x EPS. I’d personally rather own FL or other retailers on this list. However, investors more bullish on retail may see it very differently.

And if those investors are right, the short float and recent underperformance suggest BKE may have the most upside of any retail stock on this list.

Hot Stocks To Buy Right Now

Semiconductor stocks were hit hard by the recent market sell-off, but the underlying business of this industry is growing—and should continue that trend in 2018 and beyond. Throughout the chip-making space, companies have successfully adapted to the changing needs of the consumer, including an increased demand for small, high-powered chips that enable “Internet of Things” (IoT) devices.

For those that don’t know, the Internet of Things is the growing world of interconnected household and industrial devices. Everyday products and machines can now be embedded with sensor technology to process data or interact with other electronic devices.

For example, consumer-level IoT products include things like Amazon’s (AMZN) Echo “smart speaker,” wearable motion and activity tracking products, and advanced in-car technology. On the commercial side of the IoT market, industrial manufacturers have begun implementing sensors into machines to track performance and efficiency.

As demand for the microchips that power these IoT devices continues to grow, semiconductor manufacturers with a focus on IoT products will continue to benefit. And 2018 promises to be another marquee year for these suppliers, with the number of connected devices worldwide set to continue its rapid growth.

With that said, we’ve found three already-strong stocks that are looking to benefit even more from further IoT growth in 2018:

Hot Stocks To Buy Right Now: Twitter, Inc.(TWTR)

I’m not the biggest fan of Twitter Inc (NYSE:TWTR) based on current valuation, but there is no doubt that this stock has broken its two-year slump and skyrocketed to levels not seen in several years.

For most of 2016 and 2017, TWTR stock was range bound in the mid-teens level. Advertising revenue growth was coming off the rails, and actually dipped into negative territory for several consecutive quarters in 2017. Profitability concerns grew, and the question turned from “How profitable can Twitter be?” to “Will Twitter ever be profitable?”

But then everything changed in the fourth quarter of 2017. Advertising revenue growth, which had fallen into negative territory for the prior three quarters, jumped back into positive territory. The company started to figure out how to monetize its data through a data licensing businesses, which sells user data to third-party buyers. That added more firepower to revenue growth.

Plus, it’s a particularly high-margin business, so data licensing ramp led to margin expansion. Profit margins started to creep into positive territory.

All this continued in the company’s first quarter earnings report. Ad revenue growth accelerated. Data licensing revenue growth accelerated. Margins expanded. Profitability improved.

TWTR stock dropped on the news because management sounded a cautious tone on growth going forward given a competitive landscape. Plus, regulation hangs over the stock, particularly the company’s data licensing business.

For those reasons, TWTR stock looks risky here.

But there is no doubt that TWTR stock is one of the hottest turnaround stories on Wall Street right now.

Hot Stocks To Buy Right Now: Waddell & Reed Financial, Inc.(WDR)

It’s no secret that the actively managed investment fund industry is under pressure. High fees, generally poor performance and an ever-growing number of low-cost passively managed funds are all factors putting pressure on companies like Waddell & Reed.

Dividend Stocks to Avoid: Waddell & Reed (WDR)

 

The company’s earnings have steadily declined since 2014, pushing its dividend payout ratio up to close to 90% last year. As a result, management ultimately decided to slash the firm’s quarterly dividend by 46%.

Simply Safe Dividends had assigned the company a Dividend Safety Score of 12 prior to its reduction announcement, signaling high risk of a payout cut.

Unfortunately the outlook remains somewhat grim for the business, largely driven by continued performance struggles and relatively high fees that averaged 66.5 basis points last quarter.

Less than 30% of Waddell & Reed’s fund assets were ranked in the top half of their group by Morningstar over the past three-year performance period. Not surprisingly, Waddell & Reed continues to see a couple billion dollars of asset outflows each quarter.

Should the market take a tumble, the business would come under further strain.

Hot Stocks To Buy Right Now: Knight Transportation, Inc.(KNX)

Fast-Growing Stocks to Buy: Knight-Swift (KNX)

Source: David Guo via Flickr

 

Knight-Swift Transportation Holdings Inc (NYSE:KNX) had its humble beginnings in 1966, taking steel from the Port of Los Angeles to Arizona and bringing cotton from Arizona to LA.

Today, KNX is a $4 billion business with 20,000 trucks on the road throughout the U.S. and Mexico. If you see a Swift logo on a truck while driving, it’s a KNX truck.

Charles Dow, the inspiration for the Dow Jones Industrial Average, also inspired a fundamental theory about the economy and the markets. It’s simply called Dow Theory.

One of the core tenants is that if you look at the transportation and the industrial sectors, you can predict how well the economy will be doing in the near future. If transport business is rising, that’s a bullish sign.

KNX stock is up 10% year to date and up 20% in the past five months. That’s a good sign that the economy is on an upswing, and KNX stock with it.

Hot Stocks To Buy Right Now: Network-1 Technologies, Inc.(NTIP)

(NYSEAMERICAN:NTIP) has a market cap of $65 million, so it isn’t a game changer at this point. And from the looks of things, it may not get the opportunity to even try its hand becoming a force.

Its specialty is protecting intellectual property assets. Granted this is huge deal in the tech sector where knowledge is almost as important as products. If you don’t have the ability to keep your new tech ideas out of the hands of competitors, you don’t have a chance.

Most of NTIP’s IP portfolio deals with networks and Quality of Service (QoS) patents for delivering content over the internet.

It’s off 42% in the past year, but there’s no reason to go bargain hunting now.

Hot Stocks To Buy Right Now: Celanese Corporation(CE)

Celanese Corporation (NYSE:CE) announced a 17% increase to its quarterly dividend, raising it from 46 cents per share to 54 cents. Dividends will be paid from the specialty chemicals manufacturer on May 10 to shareholders of record as of April 30. As a result, CE shares trade ex-dividend on April 27.
CE Dividend Yield: 1.95%