The One Thing Equity Investors Are Good at

I can’t believe how well DeVry, Inc. (NYSE/DV) is performing. We talked about this stock only within the last month or so and the stock is up over 15 points. I can only surmise that investors felt that betting on a private education company was worthwhile while the rest of the economy stagnates.

This stock benefited recently from financial results that beat Street expectations and from a legislative proposal that would provide more financial aid for students looking to upgrade their skills. This stock is expensive now, but my best guess is that it will remain expensively priced because of the company’s track record of success.

Another bellwether stock I watch all the time is IBM (NYSE/IBM), and this one has really done well over the last two months. In fact, IBM just hit a new 52-week high and the stock is getting awfully close to its all-time record high set in the stock market craze of 1999.

I’d feel better about the general economy if companies like General Electric Company (NYSE/GE) were doing better, but you can’t have slowing economic growth without some commensurate effect on corporate earnings.

GE really hasn’t done a lot in the last three years. This benchmark stock is always worth keeping an eye on, and any sustained new upward trend in this stock will be a good sign.

I’m still really keen on Deere & Company (NYSE/DE), but I do recognize that this stock has already done exceedingly well in the last two years.

The broader market seems to be experiencing a bull move here and I think that investors are using the recent economic data, which weren’t quite as bad as expected, to speculate on the future. There is one thing that equity investors are always good at, and that is betting on the future.