Lombardi: Stock Market Commentary & Forecasts, Financial & Economic Analysis Since 1986

The Best Stocks

Lombardi Publishing was originally established in 1986 as an investment newsletter publisher offering stock market analysis to its readers…basically, the best stocks to buy. Today, we publish 25 paid-for investment letters most of which provide stock market analysis on the best stocks to buy. Profit Confidential is our daily free e-letter that goes to all our Lombardi Financial customers and to any investor who wishes to opt-in in to receive it. Written by Lombardi Financial editors who have been offering stock market analysis on the best stocks to buy to Lombardi customers, Profit Confidential provides a macro-picture on where the stock market is headed, what sectors are hot, what sectors to avoid, and the best stocks. Our two most recent and popular calls were telling investors to bail from stocks in 2007 and telling investors to jump back into the stock market in March of 2009. Timely stock market guidance that worked well for the Profit Confidential family of readers.

Facebook the Next Big Winner?

By for Profit Confidential

260213_PC_leongGoogle Inc. (NASDAQ/GOOG) traded above $800.00 on February 19, and I still can’t believe I missed out on an early investment opportunity when the stock first debuted at $100.00 in August 2004. The company has become the king of the Internet space and the favorite of retail and institutional investors in the equities market. In fact, Google now appears to be the new Apple Inc. (NASDAQ/AAPL), which has disappointed investors and is sliding downward on the chart. (Read “Mr. Cook Better Have a ‘Plan B’ for Apple.”)

The comparative stock movement of Google versus Apple in the equities market is obvious on their stock charts. While Apple has continued to slide lower since trading at over $700.00 in September 2012, Google has moved in the opposite direction, with its recent breakout above $800.00, based on my technical analysis.


Chart courtesy of www.StockCharts.com

Going back to September 2012, Wall Street was so hyped up on Apple in the equities market that several analysts started to assign a $1,000 price target to the company, suggesting Apple would be the first $1.0-trillion company in the history of the equities market. Of course, it didn’t quite pan out that way.

On the other hand, just as we had seen with Apple in September, we are now seeing euphoric analysts jumping all over Google, highlighted by a $1,000 price target from Bernstein Research.

While I’m not convinced Google can reach this magical peak within a year, I do feel the stock will inevitably trade at $1,000, unless the company decides to split the stock. But then again, co-founders Lawrence Page and Sergey Brin may have … Read More

The Great Money-Making Opportunities You Can Find in Israel

By for Profit Confidential

The Great Money-Making OpportunitiesIsrael is the “Silicon Valley” of the Middle East. The country is not widely known as a place to find high-growth technology companies, but the reality is that this small and dynamic country of 7.9 million people, nestled on the Mediterranean Sea, is just that.

The country has the second largest number of start-up companies in the world, trailing only the United States. There are about 59 Israeli companies listed on the U.S. stock exchanges, trailing only China, with 153 companies, and Canada, with 152. (Source: NASDAQ web site, last accessed February 12, 2013.)

My stock analysis suggests that one of the best stocks and a top Israeli stock listed in the U.S. equities market is pharmaceutical giant Teva Pharmaceutical Industries Limited (NASDAQ/TEVA), a developer of generic and branded drugs and active pharmaceutical ingredients.

Technology and health care are some of the leading industries in Israel, based on my stock analysis. The country has seen a steady rise in technology companies that have performed well on the world stage, as my stock analysis also shows. (To see what’s on my radar in Internet stocks, read “Here Are My Favorite Internet Plays.”)

I will mention a few that I’m familiar with, but again these stocks are not to be construed as buy recommendations; rather, they’re more for information purposes.

A small-cap technology stock that has excellent long-term potential for above-average price appreciation is Petach Tikva, Israel-based ClickSoftware Technologies Ltd. (NASDAQ/CKSW), according to my stock analysis.

ClickSoftware creates solutions that allow companies to manage resources efficiently and effectively. The company develops and sells workforce management and service optimization solutions that allow companies … Read More

Look Out McDonalds!

By for Profit Confidential

Look Out McDonaldsI’m not a big eater of fast foods, but as a business, this market offers some good opportunities for investors, namely with the top three operators: McDonalds Corporation (NYSE/MCD), YUM! Brands, Inc. (NYSE/YUM!), and rising star Chipotle Mexican Grill, Inc. (NYSE/CMG). The mainstay in the group is McDonalds, but YUM!, comprising Taco Bell, Kentucky Fried Chicken (KFC), and Pizza Hut, offers investors a diversified fast food play. The upstart is Chipotle Mexican Grill, which offers superior growth rates; but this is already discounted in the stock’s higher valuation as compared to the other two companies.

A problem we are currently seeing is some slowing in fast food sales in markets outside of the United States, namely China in the case of McDonalds and YUM!, according to my stock analysis. YUM! is currently being investigated by several law firms, accusing the company of intentionally being overly optimistic of its recent growth in its key China market in order to drive its share price higher. Of course, YUM! subsequently disclosed that its poultry supplier is being investigated by the Chinese government on concerns about safety. (Source: “Shareholder Rights Law Firm Johnson & Weaver, LLP Announces Investigation of YUM! Brands, Inc.,” Business Wire, January 11, 2013, last accessed January 25, 2013.)

The same is occurring for McDonalds as far as its poultry suppliers. McDonalds, a bellwether for the fast food industry, is continuing to report stalling in its global same-store revenues after reporting a dismal 0.1% rise in the fourth quarter, compared to 3.1% for 2012. While the company beat the fourth-quarter revenues and earnings estimates, McDonalds warned that January will likely … Read More

Why the Big Mac Will Need to Fend Off KFC, Burritos

By for Profit Confidential

Big Mac Will Need to Fend Off KFCWhen consumer spending on fast foods slows, you have to take note. This is the case with McDonalds Corporation (NYSE/MCD), a bellwether for the fast food industry, after the maker of the “Big Mac” reported some recent stalling in its global same-store revenues. The stock fell after the news of the slowing, but it has since rallied after reporting a 2.4% rise in global comparable sales in November, which was a surprise…but a nice one.

My stock analysis is that McDonalds is feeling the impact from Europe, where the company derives about 40% of its system-wide revenues. Comparable sales in Europe increased a moderate 1.4% in November, which is not great, but given the financial crisis over there, the numbers were not bad, based on my stock analysis. Revenues in Asia-Pacific, the Middle East, and Africa edged 0.6% higher in November.

My stock analysis is that McDonalds has been the top performer in the restaurant sector over the past decade, following the dramatic shift in the company’s menu offerings to include healthy meals in hopes of broadening its target market. (Read about my favorites in the discount retail sector in “From Discount to Big Box: Some Retailers to Watch.”)

McDonalds Corp Chart

Chart courtesy of www.StockCharts.com

This strategic shift worked, as McDonalds is tops on the fast food chain at this point, leaving Burger King Worldwide, Inc. (NYSE/BKW) and The Wendys Company (NASDAQ/WEN) behind, according to my stock analysis.

Yet based on my stock analysis, there’s a growing list of rivals who all have targeted McDonalds as the company to emulate to try to take some of its market share.

In the key … Read More

When You Need to Buy Technology Stocks

By for Profit Confidential

Need to Buy Technology StocksThe tech-laden NASDAQ fared the best in November with a 1.1% advance, which was well ahead of the 0.3% gain in the S&P 500 and 0.5% decline in the DOW. Yet technology and growth stocks have not fared in the equities market since the end of the first quarter, with the NASDAQ down 2.6%, versus a 0.6% advance by the S&P 500 and 1.4% decline by the DOW.

In spite of the sluggishness of technology stocks, I suggest you continue to follow my investment strategy; buy good technology stocks on market weakness in the equities market, as long as you are willing to hold on to these stocks for the longer-term and ignore the near-term volatility.

A classic example of a technology stock that fell into the doldrums and provided a good buying opportunity was Facebook, Inc. (NASDAQ/FB), which traded at a low of $17.55 on September 4 prior to rallying $11.00 a share, or a whopping 63.0%, to over $28.00 on Monday. Facebook is exciting investors with its new plan of generating revenues from its one billion subscribers in such areas as mobile advertising. The reality is that Facebook has an impressive one billion pairs of eyeballs that can be extremely valuable if a sound strategy is executed. Again I would look to accumulate on price weakness down to the low-$20.00 level. The company’s biggest threat is Google Inc. (NASDAQ/GOOG) in the equities market.

FB Facebook, Inc. Nasdaq stock market chart

Chart courtesy of www.StockCharts.com

Another major technology stock that is going through a rough patch is Apple Inc. (NASDAQ/AAPL), which at below $600.00 is down over 16.0% from its record high of $705.00 on September … Read More

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