Posts Tagged ‘investment opportunity’
Technology stocks underperformed the S&P 500 and Dow in the first quarter of the year, but that’s no big deal, as I continue to see technology as a market leader.
The month of April saw some buying return to technology stocks, with the NASDAQ managing to outperform the S&P 500—that’s a start.
While we have seen momentum dissipate from technology stocks and Apple Inc. (NASDAQ/AAPL) lose some of its shine, I remain bullish toward technology stocks.
The chart of the Technology Select Sector SPDR (NYSEArca/XLK) below shows the current sideways trading channel for this index and the current test at the upper resistance line, as indicated by the top blue line.
If my technical analysis is correct, I expect technology stocks to take a run at the resistance.
Chart courtesy of www.StockCharts.com
According to FactSet, earnings growth for the information technology (IT) sector is estimated at 0.2% in the first-quarter earnings season—if Apple is excluded. FactSet is optimistic the sector will rally in the second half of this year, with an estimated growth rate of 12.0% in the third quarter and 11.2% in the fourth quarter. (Source: “Earnings Insight,” FactSet, April 19, 2013.)
Of course, if Apple rebounds, the growth rate will likely rise.
If we exclude Apple, FactSet estimates the IT sector will grow at 10.0% and 12.4%, respectively, for the third and fourth quarters. These are pretty darn good numbers.
My top areas for growth going forward include the mobile, Internet, communications, networking, IT, and cloud computing sectors.
I suggest adding both small and large companies across different businesses, which will add diversity, making your tech holdings … 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
The airline sector is sizzling, with rising demand from China and other emerging economies, based on my stock analysis. Revenues in the global airline sector are estimated at $671 billion this year, with profits of $10.6 billion, according to the International Air Transport Association. Plus, my stock analysis suggests that there are significant plane orders flowing in, which you can read more about in “Aerospace: The Only Way Left to Play Global Growth.”
My stock analysis indicates that with the rise in demand, there is also a rise in the need for the materials used to build planes. A key material is carbon fiber—a compound used for applications that demand a high strength-to-weight ratio and rigidity, such as planes.
The global carbon fiber market is estimated to grow annually at 17% over the next five years to around 118,600 tonnes and a market value of about $7.3 billion by 2017, according to The Future of Carbon Fiber to 2017 report produced by Smithers Apex. From 2012 to 2020, the annual growth for carbon fiber-reinforced plastics is estimated at 16%. These metrics make carbon fiber plays an intriguing opportunity, according to my stock analysis.
My stock analysis indicates a potential play in the carbon fiber market for aggressive investors is small-cap special situations play Zoltek Companies, Inc. (NASDAQ/ZOLT), which is still attractive as it nears its 52-week high of $12.25. My stock analysis notes that Zoltek represents an above-average risk-to-reward opportunity in the equities market. (Please note: this is not a buy recommendation, but simply an example of a good investment opportunity for aggressive investors.)
Zoltek’s stock chart, featured … Read More
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