Are you aware of the Elsa and Anna phenomenon? The executives at Mattel, Inc. (Nasdaq: MAT) are. They’ve watched their once-popular Barbie doll lose appeal as young girls switch allegiances to the new dolls based on the popular children’s movie, “Frozen.” Barbie’s steady demise was one of the factors behind the January 2015 resignation of CEO Bryan Stockton. He took the reins of the company in November 2011, and though shares initially rose in the first few years of his tenure, they subsequently went into freefall.  After such a sharp drop, shares of Mattel are inarguably cheap. They… Read More

Are you aware of the Elsa and Anna phenomenon? The executives at Mattel, Inc. (Nasdaq: MAT) are. They’ve watched their once-popular Barbie doll lose appeal as young girls switch allegiances to the new dolls based on the popular children’s movie, “Frozen.” Barbie’s steady demise was one of the factors behind the January 2015 resignation of CEO Bryan Stockton. He took the reins of the company in November 2011, and though shares initially rose in the first few years of his tenure, they subsequently went into freefall.  After such a sharp drop, shares of Mattel are inarguably cheap. They sport a 7.6% dividend yield (more on that later), and trade for just 1.2 times trailing sales, compared to a 2.1 multiple for rival Hasbro (Nasdaq: HAS). Hasbro now has a greater market value than Mattel for the first time in more than 20 years.  Low valuations don’t make a stock inherently appealing, unless they are accompanied by a good turnaround plan. And that is just what new CEO Chris Sinclair has offered up to investors. Since becoming CEO of the company earlier this year (losing the “interim” tag in April), Sinclair has taken a close look at every aspect… Read More

Investors are not a discriminating lot. We’ve seen full evidence of this during the past few weeks. When they panic and hit the sell button, all stocks seem to get placed on the chopping block, regardless of whether they have strong or weak balance sheets, ample or minimal exposure to the turmoil in China, low valuations or high valuations… That blunt, indiscriminate approach also applies to sectors and industries. Potentially bad news for a few companies can lead a whole group to be tossed into the dustbin. That appears to be the case among one of our favorite income investments… Read More

Investors are not a discriminating lot. We’ve seen full evidence of this during the past few weeks. When they panic and hit the sell button, all stocks seem to get placed on the chopping block, regardless of whether they have strong or weak balance sheets, ample or minimal exposure to the turmoil in China, low valuations or high valuations… That blunt, indiscriminate approach also applies to sectors and industries. Potentially bad news for a few companies can lead a whole group to be tossed into the dustbin. That appears to be the case among one of our favorite income investments here at StreetAuthority: the energy-focused master limited partnerships (MLPs). In today’s essay, I’m going to show you why the selling is overdone — and how smart investors can take advantage and buy some of the best income-generating assets the market has to offer at compelling low prices. Although dozens of MLPs offer up a range of risk profiles, all have plunged sharply in recent weeks and months. And a man named Greg Armstrong may be to blame. Armstrong is the CEO of Plains All America Pipeline L.P. (NYSE: PAA). Plains All America falls into the “infrastructure” MLP category. The partnership… Read More

While it may feel as if the stock market is in a deep slump, the S&P 500 is still within 10% of its all-time high. Perhaps the market environment feels so lousy because many individual stocks are now trading far below their 52-week highs. In fact, more than a quarter of all stocks in the S&P 500 have fallen more than 30% from their peak. And fully 96 of the companies in the index are now trading more than 40% below the 52-week high. #-ad_banner-# I’ve spent the last week researching this group of laggards. Many — if not most… Read More

While it may feel as if the stock market is in a deep slump, the S&P 500 is still within 10% of its all-time high. Perhaps the market environment feels so lousy because many individual stocks are now trading far below their 52-week highs. In fact, more than a quarter of all stocks in the S&P 500 have fallen more than 30% from their peak. And fully 96 of the companies in the index are now trading more than 40% below the 52-week high. #-ad_banner-# I’ve spent the last week researching this group of laggards. Many — if not most — of them may stay stuck in a rut for some time to come, thanks to growth headwinds of still-rich valuations. Yet a handful of these losing stocks are clearly oversold, and poised for a sharp rebound in coming quarters. These are the three best opportunities I’ve found. Kohl’s (NYSE: KSS) Earlier this year, shares of this department store retailer were surging as management laid out plans to pursue more bold fashions for the back-to-school and holiday seasons. A period of subsequent tepid quarters have quashed investor enthusiasm, leading shares to fall sharply. To be sure, fiscal… Read More

What a difference a year makes. The market for initial public offerings (IPOs) was on fire in 2014, as 275 companies took the plunge, the highest figure since 2000. Those firms raised a collective $85 billion, which was also the best showing since 2000. A hot IPO market typically leads to great gains for investors lucky enough to get shares at the offering price. Fast forward to 2015, and the IPO market has cooled off. Many companies such as Airbnb, Uber, or Spotify that may have contemplated going public this year, appear to be content to raise more money from… Read More

What a difference a year makes. The market for initial public offerings (IPOs) was on fire in 2014, as 275 companies took the plunge, the highest figure since 2000. Those firms raised a collective $85 billion, which was also the best showing since 2000. A hot IPO market typically leads to great gains for investors lucky enough to get shares at the offering price. Fast forward to 2015, and the IPO market has cooled off. Many companies such as Airbnb, Uber, or Spotify that may have contemplated going public this year, appear to be content to raise more money from private equity investors. For the companies that did decide to proceed with an IPO, results have ranged from tepid to lousy. Indeed many companies that became public this year are now selling below their offering price. Here’s a look at three of them that have suffered from bad timing, but should post solid rebounds as they put a few more quarters under their belt as a public company. 1.    TerraForm Global (Nasdaq: GLBL) This company acts as an electric utility in many fast-growing emerging markets as Brazil, India and China, and derives almost of all of its power from… Read More

It’s been five years since the Financial Times first made use of one of the less flattering economic acronyms: PIIGS. Back then, Portugal, Ireland, Italy, Greece and Spain were seen as economic basket cases, and it was widely assumed that one or several of them would eventually default on their massive debt burdens. While such an event has yet to pass, Greece remains quite sickly, and Portugal and Italy continue to wrestle with profound economic dislocation. To varying degrees, these countries have failed to embrace the badly-needed economic reforms that are essential to sow the seeds of a lasting economic… Read More

It’s been five years since the Financial Times first made use of one of the less flattering economic acronyms: PIIGS. Back then, Portugal, Ireland, Italy, Greece and Spain were seen as economic basket cases, and it was widely assumed that one or several of them would eventually default on their massive debt burdens. While such an event has yet to pass, Greece remains quite sickly, and Portugal and Italy continue to wrestle with profound economic dislocation. To varying degrees, these countries have failed to embrace the badly-needed economic reforms that are essential to sow the seeds of a lasting economic recovery. Yet despite heavy odds, Ireland and Spain are clearly on the comeback trail. Thanks to broad-based reform packages, their economies have begun to turn the corner. And with the aid of a very competitive currency, their futures are looking far brighter than most would have suspected just a few years ago. For investors, exposure to these dynamic turnaround stories can be had through a pair of country-specific exchange-traded funds (ETFs). Ireland Is Back In Business Ireland and its citizens are remarkably resilient. They have been through myriad crises over the past two centuries, and always manage to bounce… Read More

“Talk to me when it’s timely.” That’s a response I often heard when pitching my best sell-side ideas to my firm’s hedge fund money manager clients. Most fund managers want to hear about a stock idea only when it is on the cusp of a big upward move. Lacking such imminent catalysts, a stock can languish for an extended period. Yet value-oriented fund managers take a completely different view. They love to find stocks that offer deep intrinsic value, and they are willing to be patient and wait for an unloved stock to morph into a loved one. #-ad_banner-#And right… Read More

“Talk to me when it’s timely.” That’s a response I often heard when pitching my best sell-side ideas to my firm’s hedge fund money manager clients. Most fund managers want to hear about a stock idea only when it is on the cusp of a big upward move. Lacking such imminent catalysts, a stock can languish for an extended period. Yet value-oriented fund managers take a completely different view. They love to find stocks that offer deep intrinsic value, and they are willing to be patient and wait for an unloved stock to morph into a loved one. #-ad_banner-#And right now, perhaps no other blue chip is so unloved — and holds such deep value — as General Motors (NYSE: GM). By a whole host of metrics, shares of this auto maker are a stunning bargain. And for investors that have a 1-2 year time horizon, robust gains can be had. Equally important: shares offer such deep value right now, that they are very likely to stand their ground if the market tumbles further. Recent Setbacks Have Hurt GM’s Share Price General Motors has recently been beset by a series of setbacks, some of them self-inflicted. For example, in… Read More

You don’t amass a net worth of $20 billion by accident. You do so by continually spotting investment opportunities where others fear to tread. And you also need the courage to rattle a few cages when necessary. That’s been the winning formula for Carl Icahn, who is still reaping major investment victories at the age of 79. To be sure, following in Icahn’s path is not easy. That’s because he tends to focus on investment opportunities that don’t hold much obvious appeal. For example, in recent quarters, Icahn’s firm has amassed a large stake in beleaguered energy driller Chesapeake Energy… Read More

You don’t amass a net worth of $20 billion by accident. You do so by continually spotting investment opportunities where others fear to tread. And you also need the courage to rattle a few cages when necessary. That’s been the winning formula for Carl Icahn, who is still reaping major investment victories at the age of 79. To be sure, following in Icahn’s path is not easy. That’s because he tends to focus on investment opportunities that don’t hold much obvious appeal. For example, in recent quarters, Icahn’s firm has amassed a large stake in beleaguered energy driller Chesapeake Energy (NYSE: CHK), even as most investors are shunning oil and gas stocks these days. And while most investors are avoiding commodity stocks in general these days as they note the deep distress in the industrial metals sector, Icahn recently disclosed an 88 million share stake in Freeport-McMoran (NYSE: FCX), which has seen its share price fall from the 52-week high of $35 to a recent $11. A Well-Timed Buy The timing of Icahn’s disclosure of an 8.5% stake in this struggling copper and oil producer was spot on. On August 27, the company threw in the towel on its… Read More

“The market has already done the Fed’s dirty work.”   That’s a refrain you’ll hear quite often these days, because so many interest rate-sensitive sectors have already sold off sharply in anticipation of higher interest rates. When rates do finally start rising (perhaps as soon as mid-September considering the August employment report), investors will likely realize that they have over-reacted. After all, the Federal Reserve is expected to act “low and slow,” meaning that interest rates are expected to be boosted at a very slow pace over an extended period. That means that 12-18 months from now, rates… Read More

“The market has already done the Fed’s dirty work.”   That’s a refrain you’ll hear quite often these days, because so many interest rate-sensitive sectors have already sold off sharply in anticipation of higher interest rates. When rates do finally start rising (perhaps as soon as mid-September considering the August employment report), investors will likely realize that they have over-reacted. After all, the Federal Reserve is expected to act “low and slow,” meaning that interest rates are expected to be boosted at a very slow pace over an extended period. That means that 12-18 months from now, rates aren’t likely to be much more than 50 or 75 basis points higher than they are today. And by anybody’s math, a Federal funds rate under 2.0% is still extremely low by historical standards. Interest rate fears have really hurt sentiment in yield-focused investments such as the master limited partnerships (MLPs). A wide range of bargains have now emerged in that group, led by Enterprise Product Partners (NYSE: EPD).   Yet it’s hard to find any group that has been tarnished as badly as the business development companies (BDCs). These firms act as lender and investor to small… Read More

It’s true that a swing-for-the-fences approach is a very risky way to invest. When you find such golden opportunities, you should always make a modest investment. Any stocks with potentially robust upside usually often possess a lot of downside risk as well. Yet there are ways to mitigate risk when pursuing stocks with high upside. If they already sport low valuations, or if they have very strong balance sheets, they likely have limited downside. In effect, such stocks already reflect ample negative sentiment, and with a few helpful catalysts, can quickly move back into favor. #-ad_banner-#Every year, I like to… Read More

It’s true that a swing-for-the-fences approach is a very risky way to invest. When you find such golden opportunities, you should always make a modest investment. Any stocks with potentially robust upside usually often possess a lot of downside risk as well. Yet there are ways to mitigate risk when pursuing stocks with high upside. If they already sport low valuations, or if they have very strong balance sheets, they likely have limited downside. In effect, such stocks already reflect ample negative sentiment, and with a few helpful catalysts, can quickly move back into favor. #-ad_banner-#Every year, I like to focus on a basket of three stocks with triple-digit upside potential. I am glad to say that my track record with this approach over the years has been fairly solid. When I took this approach last September, I found three stocks that have largely delivered on my expectations: Lionbridge Technologies (Nasdaq: LIOX) has risen 14%, Novavax (Nasdaq: NVAX) has gained 147% and Merge Healthcare (Nasdaq: MRGE), thanks to a buyout offer from IBM (NYSE: IBM), is up 222%. If you owned these three stocks as a group, you’d be sitting on a 128% return — in less than a year. Read More

Officers and directors at companies (known as “insiders”) tend to receive lavish pay packages, and rarely deserve much pity. But the past few weeks have been downright miserable for them. Those insiders that acquired shares on the open market during the recent post-earnings season window have lost tons of money. If they had just waited a few weeks longer, they could have bought a lot more shares with the same amount of funds. Well, their loss is our gain. We can now buy shares of companies where insiders only recently paid much higher prices. I looked at… Read More

Officers and directors at companies (known as “insiders”) tend to receive lavish pay packages, and rarely deserve much pity. But the past few weeks have been downright miserable for them. Those insiders that acquired shares on the open market during the recent post-earnings season window have lost tons of money. If they had just waited a few weeks longer, they could have bought a lot more shares with the same amount of funds. Well, their loss is our gain. We can now buy shares of companies where insiders only recently paid much higher prices. I looked at dozens of such examples, and found five that stand out for especially strong appeal. (All insider data supplied by InsiderInsights.com). #-ad_banner-#1. Abercrombie & Fitch (NYSE: ANF) Back in June, a cluster of three insiders acquired $1.5 million in stock, at an average price of $22.30 a share. They may have been attracted to the fact that shares traded above $40 last summer. But they acted too soon, as shares have since plunged to just $17 in this market rout. This youth-focused retailer has been struggling for growth in recent quarters. But an improving employment picture, especially for… Read More