Louis Navellier | Louis Navellier here again. In yesterday’s letter, I said I’d tell you about the origins of my system that helped me identify and recommend many of the biggest stock market winners of the past 40 years. And, I’m going to share how folks use my system to bet big on the winners. Here’s the story… When I was in college at Cal State Hayward, one of my professors gave me an assignment to create a model portfolio that would mimic the performance of the benchmark S&P 500 index. It was a dream assignment for a numbers guy like me… but I failed at it spectacularly. The problem? My model kept beating the S&P 500. This was back in the late 1970s when everyone believed it was virtually impossible to beat the market without taking on excessive risk. Conventional wisdom was that you might get lucky for a while, but no one could consistently beat the market. Thankfully, my professors gave me unprecedented access to Wells Fargo’s expensive and powerful mainframe computers to continue to build my stock selection models. (Remember, this was more than 40 years ago, before laptops and PCs.) Through hundreds of hours of research, I discovered how an elite type of stock consistently outperformed the broad market, year in and year out. Through extensive analysis, I isolated the eight key qualities that these super-performing stocks shared… and I developed a system for tracking them. The research I did back then serves as the foundation of what is now an advanced, high-tech method of computerized market analysis. If you’ve been investing in stocks for a while, many of the qualities I’ve identified probably won’t surprise you. That’s because four of the eight qualities are related to earnings. The Real Secret to Making Money in Stocks On any given business day, millions of people pay attention to the blinking lights and flashing numbers they believe make up “the stock market.” Unfortunately, just a tiny percentage of those people will ever understand the real secret to making money in stocks. These folks forget that a stock isn’t just a flashing light on a screen or a trading hot potato. When you buy a stock, you buy a partial ownership stake in a real business. You own a slice of that company’s equipment, inventory, patents, real estate, and brands. You become financially exposed to both the company’s upside and downside. The major drivers of a stock’s prices are earnings (or the anticipation of them). The more a company grows its earnings, the more its shares will be worth. Stock price trends can diverge from earnings trends for a while, but over the long-term, if a company grows and grows the amount of cash it takes in, its share price is sure to head higher. That’s how the market works. It’s the “iron law” of the stock market. And that’s why if you’re looking for stocks with massive upside potential, you should focus on the companies with massive revenue and earnings growth. This is why my computer programs are constantly scanning the market for companies with outstanding quarterly earnings growth… outstanding annual earnings growth… and a tendency to surprise Wall Street analysts with better-than-expected earnings growth. In addition to qualities related to superior earnings growth, my system screens for companies with increasing operating margins, increasing sales growth, high returns on equity, and strong cash flow. Corporate America is not Lake Wobegon, where all the kids are above average. The brutal truth is that some companies are much, much better than others. They have better management, better products, bigger profit margins, stronger sales, stronger balance sheets, etc. My system analyses over 45,000 stocks, grades them according to the individual qualities listed above, and also combines the individual metrics to create an overall composite grade for any stock. These grades are just like the ones in school. A stock with the highest growth and business quality ratings gets an “A.” A stock with miserable ratings gets an “F.” The result of all this work? My readers buy the world’s fastest growing companies… and hold them through their most successful years of expansion. My subscribers have profited from gains of 751% with VipShop Holdings, 347% with America Movil, and 457% with Holly Corp. — all because of this grading system. I hope you've found these letters educational. As a reminder, I shared my “origin story,“ the eight fundamental factors I use to pinpoint the next big winners, as well as how my grading system works. Now, Market 360 isn't the only amazing free resource at your fingertips right now. This resource could massively benefit you and your family, starting today. You see, I work with one of the world's top independent investment research firms. Its name is InvestorPlace. Being an “independent investment research firm“ means we don't work for banks or Wall Street firms. We don't earn investment banking fees. That's the way the investment business should be — completely transparent, with no conflicts of interest. We follow a very simple — and many say refreshing — business model: We simply publish world-class investment guidance and recommendations to help folks become wealthier, smarter investors. If our members do well with our research, they stay with us. In many cases, they become lifetime members, meaning they ask to receive everything we publish, for life. We've been doing business this way for more than 40 years. In fact, when it comes to longevity and track record, I don't know of another research group that can match our track record of getting the "big calls" right. For example: - In the early 1990s, we predicted the rise of the Internet and the wealth it would create.
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Big calls like this are the reason InvestorPlace analysts are regularly featured in Barron's, The Wall Street Journal, USA Today, The New York Times, and on Fox Business News, CNN, and CNBC, among many others. But what matters above all else is that our readers profit from our work. Over the years, we've helped folks from all walks of life vastly improve their lives and their finances… like subscriber Fred K., who said: “From day one, I've never lost money and have had years of double digit returns. I have tripled my money and now have a portfolio that's over 3 million dollars.“ InvestorPlace subscriber Ken L. told us: “I have made well over $100,000 in the last year on just two recommendations.“ Richard S. wrote to say that “we were able to use our gains to travel to South Africa for 14 days, which was one of our life-long dreams.“ Robert B. from Colorado said: “I have been a follower of yours for 20 years, and thanks to your sage advice, I am now happily and quite comfortably retired!“ And paid subscriber Reuben K. told us our research “has been a success… I've made millions as a result. About $6 million at last count. Thank you on behalf of myself and my family.“ In short, the results our subscribers get from our work is the only way we measure success. Here's how we can help you achieve greater financial success going forward… Another Benefit of Your Free InvestorPlace Subscription Every afternoon starting tomorrow, you'll receive our in-house e-letter, called the InvestorPlace Digest. The Digest aims to make our subscribers smarter, richer investors by covering the most important business and investment situations on Earth — brought to you by some of the best investing minds in the world. Inside the Digest, you'll find a range of useful, interesting — and most importantly ACTIONABLE — insights and recommendations. We'll alert you to the biggest long-term market trends, like we did with the Internet in the early 1990s and the post-2008 bull market. We'll alert you to big dangers, like we did with tech stocks in the 2000s… and the housing market in 2007. And when there's an opportunity to make big, fast gains in rapidly developing booms like Bitcoin or 5G, you'll read about it in the Digest — including our analysts' favorite ways to take advantage of them — just like we did with both of these sectors YEARS before they went “mainstream“. Don't worry if you don't have the time to read all the major investment journals, newspapers, magazines, and financial research reports. We have a staff of more than a dozen researchers and analysts contributing to the InvestorPlace Digest. We read everything for you… and share with you ONLY the most important, most useful ideas. We filter out all the fluff and BS… and pass along time-saving “condensed wisdom“ to our readers. We aim to show you what's around the corners of the business and investment world… we'll help you connect the dots and know what's really happening behind mainstream headlines. It's by following these mandates that we count so many hedge fund managers, financial advisors, and wealthy individuals as long-standing clients. You might think that's a lot to give away for free. And, it is. But by introducing the InvestorPlace Digest and sharing our work for FREE, our hope is that you'll quickly see the value and usefulness of our independent research and recommendations… and consider joining so many of America's most successful people as a member of our “family“. Our team is looking forward to serving you for a very long time. Regards, |
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