Stock analysis is the application of a method or set of criteria to evaluate a company’s stock. This analysis can fall into several areas; more broadly this encompasses fundamental analysis, technical analysis, and quantitative analysis. Fundamental analysis covers the research of a company’s financial statements, its management, the marketplace, the firm’s competitors, and forecasts for the future of the business. Technical analysis is the study of a stock’s chart. Someone using technical analysis wouldn’t look at the income statement, but would spend their time looking at the chart and indicators, such as volume, moving averages, and past market moves to forecast future stock moves. Quantitative analysis is when a computer is programmed to look for patterns using mathematics. Some examples of quantitative analysis can be found in statistical arbitrage or algorithmic trading.
The stock market came off its worst week this year; but even given the minor correction, I don’t think we can relax enough to re-enter the market and buy, based on my stock analysis.
I think there could be a more significant market correction down the road that could shave another five percent off the current levels.
Yet even so, the selling over the recent sessions have driven the key stock indices down to levels that are more realistic compared to levels at the end of the first quarter, according to my stock analysis.
Simply put, the previous rate of the advance was not sustainable.
My stock analysis shows that with April coming to an end, we could also be seeing the final leg of the current six-month bull cycle from November to April that has historically resulted in the best gains, according to the Stock Trader’s Almanac.
This doesn’t mean that stocks are not worth a look for the next six months. But if the historical cycles pan out, the best gains may have already been made, so it will come down to stock selection, according to my stock analysis.
Let’s take a look at the investment climate at this juncture.
What’s critical right now is the first-quarter earnings season. So far, with about 104 S&P 500 companies having reported, the results have more or less been in line with the previous quarters, with about 67.3% beating earnings-per-share (EPS) estimates, according to Thomson Financial.
Another 170 S&P 500 companies are reporting this week.
Of the 20% of the S&P 500 companies that have reported, the results … Read More
It’s clearly not a surprise whatsoever, as we have seen this trend developing for years following the major push of tablets into the marketplace, according to my stock analysis.
We have seen all of the PC makers report declining sales and the need to re-invent and adapt to the rapidly changing environment for mobile devices.
Intel Corporation (NASDAQ/INTC), which used to be an icon on Wall Street and in Silicon Valley, is succumbing to the mobile wave. And it’s only going to become a technological tsunami that could inevitably devastate the PC sector and drive industry changes in order for survival, based on my stock analysis. (Read “PC Sector Struggling; Time for One Last Goodbye?”)
Chart courtesy of www.StockCharts.com
The results released from Intel on Tuesday support my argument.
Let’s take a look (source for all data: “Intel Reports First-Quarter Revenue of $12.6 Billion,” Intel Corporation web site, April 16, 2013):
Revenues from Intel’s once-thriving PC Client Group (PCCG) fell another six percent year-over-year to $8.0 billion in the first quarter, down 6.6% on a sequential basis.
My stock analysis indicates that volume in the notebook segment fell six percent year-over-year in the first quarter, while volume in the PC segment declined seven percent year-over-year.
But what was interesting was the Intel Architecture Group, which comprises the mobile business, including its tablet and smartphone business—areas that I feel will be critical for Intel to expand, based on my stock analysis.
The Intel Architecture Group accounted for a mere 8.5% of total revenues in the first quarter. My stock analysis … Read More
At my household, no one uses a personal computer (PC). There is the occasional use of a laptop, but even these mobile devices are becoming cumbersome to handle. In fact, the dominant devices of choice in my household are tablets, phablets (large smartphones with the capabilities of a tablet), and smartphones. These devices are small, light, mobile, and increasingly powerful enough to work on, whether it’s for work or for school.
What is occurring in my household is also happening across America and, in fact, around the world, according to my stock analysis.
Users are increasingly demanding smaller and more powerful devices. My stock analysis indicates this has been the trend, and it’s not going to change anytime soon, despite many efforts by the PC makers.
Dell Inc. (NASDAQ/DELL) was playing around with a hybrid laptop/tablet combo. It was pretty gimmicky, and it was just a failed attempt to override the tablet, based on my stock analysis.
Microsoft Corporation (NASDAQ/MSFT) recently launched PCs and laptops with its touchscreen “Windows 8” platform, but they’ve failed to catch on so far. Having played with these touchscreen computers, I still prefer the feel and portability of the tablet. I think the majority of users are in sync here, based on my stock analysis.
Bob O’Donnell of International Data Corporation (IDC) said, “At this point, unfortunately, it seems clear that the Windows 8 launch not only failed to provide a positive boost to the PC market, but appears to have slowed the market.” (Source: “PC Shipments Post the Steepest Decline Ever in a Single Quarter, According to IDC,” International Data Corporation web site, … Read More
It has been a great five months so far for stocks, as we get set for the blooming of the flowers in May. Unfortunately, the rebirth of your garden and everything that comes along with spring and summer doesn’t coincide with the best months for investing in the market, according to my stock analysis.
April tends to be characterized by rain, but it could also be the final leg of the current six-month bull cycle from November to April that has historically resulted in the best gains, according to the Stock Trader’s Almanac and its founder Yale Hirsch.
Just take a look at the recent five months from November. The S&P 500 has reported gains in five straight months, with a combined gain of 9.4%, based on my stock analysis.
According to the Stock Trader’s Almanac, the upcoming May–October period is considered the weakest six months for stocks, which is why you will soon begin to hear the common phrase, “Sell in May, and go away.” The historical records reflect the cycle. In the past half-century, the Dow moved up, on average, less than one percent from May to October but averaged over seven percent in the other six months, based on my stock analysis.
My stock analysis suggests that while the historical tendency is not foolproof, if I were a betting man, I might wager on the cycle proving itself once again this year as the stock market is currently stalling. (Read “Market Action Driven by Headlines; Investors Should Be Nervous.”)
Take a look at the chart of the S&P 500 below. Note the … Read More
Facebook, Inc. (NASDAQ/FB) has attracted over one billion pairs of eyeballs, and my stock analysis suggests its share price may really explode upward if the company can monetize this massive user base. The future for the company will clearly lie with its aggressive shift into mobile advertising, an area that numerous companies, including Google Inc. (NASDAQ/GOOG), are trying to control, based on my stock analysis. (Read “Google Could Be the First $1,000 Stock.”)
The problem with Facebook is that it needs to have better control over its social networking platform. My stock analysis suggests this could only happen if the company can more effectively integrate its product into the operating system of a smartphone, which appears to be the case, as Facebook is expected to launch a new “Android”-based product. The speculation is that a Facebook phone will be produced by HTC Corporation and will focus on the integration of Facebook. (Source: Ortutay, B., “Eyes on Facebook mobile event as company evolves,” Associated Press, April 4, 2013.)
In the article, the potential stakes for Facebook and other companies in social networking are growing exponentially. Spending on U.S. mobile advertising is estimated to surge 77% in 2013 to $7.29 billion, according to eMarketer. Facebook is estimated to corral $965 million.
Based on my stock analysis, I like the company’s focus on pumping up its mobile advertising area. In the fourth quarter, mobile revenues accounted for 23% of Facebook’s total $1.33 billion in advertising revenues, up from 14% in the first quarter. The interesting number was the company’s total mobile monthly active users, which came in at 680 million in … Read More
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