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1 Exploding Stock To Buy Right Now (It’s Not Slowing Down)

By The Breadwinner

In 1996, Fed Chairman Alan Greenspan warned about irrational exuberance among traders and investors. Over the following three years, the Nasdaq would go up by almost 300%. Trying to time the market could be the hardest — and least successful — strategy to investing.

One way to invest that might sound too easy is to buy only the companies doing the best and add money over time. That is especially true if the company is affecting legacy players in a huge market. Despite a stock price that is rising, Upstart Holdings is giving you this opportunity.

A ton of opportunity

Upstart has created a model using machine learning to look at risks. Its banking partners use the model by making better lending choices, mostly for personal loans. And it seems to be benefiting everyone. In a study done by the Consumer Protection Bureau, the firm’s strategy led to 27% more borrowers getting approved with a 16% lower interest. It’s also helping to give a better platform experience by automating these decisions. The firm is now looking at going into even larger markets.

In the first quarter, it bought Prodigy Software — a company that seeks to help auto dealers move their company operations online — and has listed credit cards, auto lending, and home mortgages as possible uses of its technology. These are much larger markets, and it might take years to achieve that penetration.

A ton of growth

So far, management is proving itself capable in the personal loan industry and providing every sign that they can repeat their strategy in auto lending. The company is growing so fast, it appears like executives can’t keep up. They reported three quarters, starting with its 2020 report, and has increased its fiscal year 2021 revenue every time. It has boosted the number by 50% in five months.

Wall Street is having a hard time keeping up too. The stock has now gone up by 480% since the IPO. If you believe the gains are supporting this, consider Upstart still only has a market cap of $13.2 billion.

The analysts will upgrade some more after the company’s Q2 earnings this week. Upstart reported $194 million in revenue — over a 1,000% y/y growth — and guided 2021 revenue to $750 million. According to Yahoo! Finance, the top analyst estimate for 2021 revenue is $605 million.

Author: Scott Dowdy

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America’s Top CEOs Sound The Alarm On Incoming Catastrophe

By The Breadwinner

The Tyson Foods company, which is the top chicken producer in the United States, has confirmed during an earnings call that food inflation is continuing to go higher and push prices upward.

Tyson’s CEO Donnie King revealed that higher costs are hitting the company faster than they can increase their prices, and retail prices are scheduled to increase on Sept. 5.

King must have had a mental hick-up during the group earnings call because the term “transitory” was not a part of his conversation.

Everything from labor to fuel to raw materials (soybeans and corn) to shipping to other inputs crucial for farming has gone up exponentially over the past year.

None of this should come as a surprise as we have referenced two Bank of America reports that said that “transitory” hyperinflation was not only ahead but has actually already arrived.

In May, Bank of America said, “Buckle up! Inflation is now here,” and then they revealed a chart of the number of times “inflation” was mentioned during earnings conference calls which shows the term had exploded, more than tripling for every firm so far, and the largest jump in history since Bank of America started keeping records starting in 2004.

The bank ended with the take that this “points to at least transitory hyper-inflation being ahead.”

Then in the month of June, Bank of America’s economist Alex Lin said that the “transitory inflation” meter is at an all-time high right now, “suggesting there was significant room for a pullback over the next twelve months.”

Lin’s note supports what the bank said back in May: that the United States is currently in a time of hyperinflation, and the bank is also hopefully right that this will simply be transitory.

Whether it really does turn out permanent or transitory, remains a worrisome question – but evidence seems to be mounting, now with Tyson, that food prices are yet to peak and are still going up.

This is sure to be one of the most significant economic events in America’s history. With the pandemic triggering never before seen affects, the reality of what could happen is limitless.

Author: Scott Dowdy

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Nation’s Food Producers Give a Terrifying Warning

By The Breadwinner

The inflation data from July shows a 5.4% increase — matching last month’s levels.

According to data put out by the Bureau of Labor this Wednesday, inflation last month went up to 5.4% — equaling its rate for June, which was the highest seen since the Great Recession of 2008.

Over the past twelve months, average energy prices have gone up by 23.8%, with fuel and gasoline getting a price hike of 39.1% and 41.8% respectively. Meanwhile, prices for used autos also went up by 41.7%.

“I’m laughing at everyone for putting their money in stocks and Bitcoin,” joked Senate candidate J.D. Vance. “I purchased a 1999 Honda Civic just last year and now it is worth $2 million.”

Beyond the transportation and energy sectors, food companies are raising prices in a drive to match increasing prices.

In Tyson Foods’ Q3 earnings conference call, CEO Donnie King informed his investors that the company has “witnessed unprecedented and accelerating inflation” threatening its whole business. It will therefore increase retail prices on Sept. 5 — even though it had raised prices before for restaurant customers.

Nestlé — the world’s biggest food and drink company — announced that it too would increase prices to keep up with inflation. CEO Mark Schneider said that “what we have seen this year is a sort of turning point, where after many years of lower inflation, all of a sudden it quickly and strongly accelerated.”

As we recently explained, Americans are seeing lowering wages due to the affects of inflation — despite better wage growth after COVID-19 and the lockdown and recession.

The Bureau of Labor numbers reported just last month that “average hourly income” in the United States increased by 3.6% between June of last year and June this year. Nevertheless, when looking at year-over-year changes in consumer prices, “true hourly earnings” have gone down by 1.7% over the previous year.

Vance said that “the Trump years provided the first sustained wage growth for middle class and working class Americans in a long time.” Inflation “will kill that progress.”

Author: Steven Sinclaire

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2021’s Best Investments Will Have You Set For Life

By The Breadwinner

Building a good portfolio can be hard, because there are limitless roads to go down. If you are new to the market, all of those options can get overwhelming.

The good news is that it is easier than you might believe to create a rock solid portfolio. These three types of investments are a great choice regardless of your investing experience, and they can help push your savings to new levels.

1. S&P 500 ETFs

An S&P 500 ETF is a selection of stocks that is created to copy the performance of the S&P 500. That means all of these funds have around 500 stocks from the biggest U.S.-based companies.

This kind of investment is among the more stable and has lower-risks. While the S&P 500 does have short-term volatility, it has brought in an average return of about 10% every year.

Where to start: There are numerous S&P 500 ETFs to look at, and they are all similar. Some of the best ones include:

Vanguard S&P 500 ETF
iShares Core S&P 500 ETF
SPDR S&P 500 ETF Trust

2. Growth ETFs

A growth ETF is a fund that has stocks with better-than-average growth. The advantage of this sort of investment is that you might earn greater returns than you would with a larger-market fund such as an S&P 500 ETF.

The downside, of course, is that these ETFs are more risky. High-growth stocks can have more volatility than other more established stocks, so you might see more ups and downs with this sort of fund than you would if you had an S&P 500 ETF.

Where to start: It’s crucial to choose carefully when looking for a growth ETF, because some funds are better than others. For example, some funds only have smaller companies from niche industries. And this poses more risk than one that has larger corporations from a lot of industries. A few good growth ETFs are:

Vanguard Growth ETF
iShares Russell 2000 Growth ETF
Invesco QQQ ETF

3. Dividend ETFs

A dividend ETF is a group of stocks that will pay you to hold them. Some companies give you a portion of their profits every quarter or year, and this is called a dividend. By putting your money in a dividend ETF, you will earn quarterly or annual payments on top of the fund’s normal profits.

Where to start: Just as with growth ETFs, the dividend ETFs offer varying risks and profits. Some of the best funds are:

Vanguard Dividend Appreciation ETF
iShares Core High Dividend ETF
Schwab U.S. Dividend Equity ETF

Choosing the best investment is not as hard as it might seem. By creating a portfolio filled with good funds, you will be on your way to creating long-term wealth.

Author: Steven Sinclaire

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Congress Moves To Ban Credit Scores

By Graham Stephan

Author: Graham Stephan

Source: YouTube: Congress Wants To Ban Credit Scores | Major Changes Ahead

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Bitcoin Jumps Directly Into The Mainstream

By The Breadwinner

AMC is now jumping onto the crypto train.

In an earnings call this week, the theater company announced it would begin introducing crypto tech to allow all moviegoers in the U.S. to buy their snacks and tickets in bitcoin by year’s end.

“I have had to learn more in the previous six months about cryptocurrency and blockchain than I learned about the technology in the whole decade before that,” said their CEO, Adam Aron.

He added that his company was also looking into “how else AMC could participate in this new cryptocurrency world, and we are very interested in the lucrative business possibilities.”

For now, the change will allow their customers to purchase tickets over the internet using bitcoin for all of the company’s US-based theaters. The CEO said that “since we did the IT work to accept bitcoin, we are also simultaneously creating the code to accept Google Pay and Apple Pay for purchases at our American locations.”

Investors applauded this news with AMC shares increasing 5.3% in overnight trading. Bitcoin was higher 5.5% from a day earlier.

As cryptos become a more mainstream option, a larger number of companies are looking how to use them in their business operations.

Last month, digital currencies increased after bullish remarks from the CEO of Twitter, Jack Dorsey and the CEO of Tesla, Elon Musk.

Musk had said at the time that his two companies — Tesla and SpaceX — both held bitcoin, while Dorsey reported that the digital currency could have a role in Twitter’s strategy in the future.

That week, reports of an Amazon job posting also had bitcoin surging. The company was trying to hire someone for a “blockchain and digital currency product lead,” who would help its payments group create “new capabilities.”

“We are inspired by the innovation being done in cryptocurrency and are exploring what this might look like on Amazon’s platform,” a spokesperson said at the time.

“We believe the future will use these new technologies that allow inexpensive and fast payments, and hope to bring this future to Amazon as soon as we can.”

Author: Steven Sinclaire

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This High Growth Stock Just Dipped… But Should You Rush To Buy It?

By The Breadwinner

Another quarter and somewhat disappointing earnings from software company PTC. The results were aligned with management’s expectations. Still, investors were expecting more given that the economy is getting better and the fact that PTC’s partner, Rockwell Automation, updated its guidance toward the high end of its past range. Rockwell gives automated solutions and PTC gives complimentary augmented reality and internet of things solutions. Is it time to purchase the stock while it is dipping or run away?

Growth portfolio

Revenue growth in PTC’s product group came in lower than what management had wanted. More on that in a minute.

The investment case for purchasing PTC stock is based on its core product type, computer-aided design (CAD) and product lifecycle management (PLM), expanding at a high-single-digit to low-double-digit percentage over the medium term. The company is giving its PLM and CAD solutions as an SAAS option, and management thinks this will give growth in the future.

However, the fascinating part is that their growth product types (IoT and AR apps), are forecasted by executives to grow at a 30%-plus rate over the short term. AR and IoT are at the heart of the 4th industrial revolution, where companies will connect real world assets with the digital world to achieve greater productively.

Unfortunately, the uptick in PTC’s growth products was somewhat disappointing. Organic ARR y/y growth at a constant currency was at 23% in Q3, after an increase of 27% in the past quarter.

Should you buy it?

On balance, I believe the answer is “yes.” PTC’s growth is still great; it just has not been at the level that many investors wanted it to be for in 2021. No matter, the numbers are still inside management’s guidance, and it does not make sense to judge a long-term growth stock on the back of a couple of somewhat disappointing earnings quarters.

That said, investors will be wanting to see a much better report in the Q4 reports with some proof of growing demand in the growth product portfolio going into a new fiscal year. Indeed, Heppelmann thinks that PTC’s IoT business will be ended the fiscal year on a “better note.” If he is right, then the recent lowering will prove a great buying opportunity.

Author: Steven Sinclaire

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Top Tech Company Hit With This Overnight “Rating Change”

By The Breadwinner

“We have certainly been wrong in our Underperform rating on AMD,” says BMO analyst Ambrish Srivastava.

AMD has traded higher Monday after BMO analysts increased their target price and rating for the CPU maker amid an improving earnings climate and market share increases against its rival.

In what he said was as a ‘mea culpa’ message on the company, BMO Capital analyst Ambrish Srivastava increased his AMD rating by one notch, to ‘outperform’ and increased his price target by $30, to $110 a share, citing a better valuation, better than predicted 2022 earnings and consistent shares gains against its top rival Intel.

“More crucially, with respect to the estimates, we also think there is more upward bias as we get through the year. Especially as the company starts to boost designs it has already won in the datacenter sector, from enterprise to HPC, including GPUs and CPUs,” said Srivastava. “While anticipated, we do not think these successes are correctly reflected in estimates currently.”

“With respect to share increases in the CPU market vs. Intel, we still think the rate of share increases will moderate next year compared to Intel, as Intel creates its Icelake product and releases Sapphire Rapids,” he said. “However, the company has now gotten to a place where it has captured the position of being an alternative to Intel for the ongoing future.”

AMD shares rose 0.5% in early trading on Monday, amid a 0.05% move downward by the Nasdaq, to trade at $110.75 each, a move that would prolong the stock’s ytd gain to about 20.7%.

Last month, AMD gave a 99% y/y surge in Q2 revenues that gave a stronger-than-expected 63 cents per share.

The graphics and computing segment, which covers PC CPU and GPU sales, saw revenue total $2.25 billion, up 65% y/y and 7% quarter-over-quarter pushed by higher GPU sales.

For the entire year of 2021, AMD now predicts a revenue increase of around 60%, up from previous guidance of around 50%, driven by stronger growth among all businesses.

Author: Blake Ambrose

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Got 5k? Invest It Here To Double Your Money

By The Breadwinner

After you have been at it for a long enough time, investing seems somewhat like golf — you play the ball as it lies. You have your funds invested in certain places in certain ways. When it comes to switching your money up among different account types or among investments inside brokerage accounts, there is only so much you can really do.

So it is important to get things right from the start. If I were just starting out again in investing right now, I know what I would do to start again from scratch. I would invest my first $5,000 inside a Roth IRA by getting into the Invesco S&P 500 Equally Weight ETF, and set my dividends to be reinvested. It’s a strategy that is simple and powerful.

Why a Roth IRA?

In many respects, Roth IRAs are the top retirement accounts. Key benefits of these accounts that make them so powerful include:

Money inside your Roth IRA can grow tax free
You never need to withdraw the money from your own Roth IRA within your own lifetime
You can access your funds without no penalties or taxes
With a good annual contribution limit, your Roth IRA can lead you to being a millionaire over time

Indeed, these factors make Roth IRAs very powerful and they should be a high priority investment for you. About the only reasons to put money elsewhere first would be:

Taking advantage of your employeer’s 401(k) match.
If you don’t have earned income (since Roth IRAs must be funded by earned income).
If you earned too much to directly contribute — in this case, a backdoor could be available.

Why invest the $5K in Invesco S&P 500 Equal Weight ETF?

Index-based investing has routinely trounced the returns of most active managed funds. There are structural reasons for this — most notably, the costs and fees linked with managing a fund make it harder for those sorts of funds to bring in better profits.

The current issue with normal S&P 500 funds, however, is that these funds are market-cap weighted. As a result, the biggest companies in the index have a larger share of the index. Within the S&P 500, the top 10 firms represent over a quarter of the whole index, and those companies are mostly tech companies.

There is nothing wrong with buying technology companies, but if a goal of index investing is to get exposure to a huge swath of the economy, the Invesco S&P 500 Equal Weight ETF does this even better. Both a market cap weighted S&P 500 fund and an equal weighted S&P 500 fund invest in the same companies, but the better balance of the equal weight fund gives it an edge when it comes to diversification.

With only a 0.2% annual fee and almost zerp turnover, the Invesco S&P 500 Equally Weight ETF has a good combo of low fees and low churn that gives index funds their edge. All in all, there are lots of reasons to think the ETF has what you need for a great first investment in any investor’s portfolio.

Author: Scott Dowdy