Using Market Flip Flops to Scale Several Positions and Add a New One As Well

Using Market Flip Flops to Scale Several Positions and Add a New One As Well

A hearty welcome back!

The stock market is moving a little faster and more volatile over the last few days, far different than what we saw through most of the summer. Inside this issue we recap the drivers for the flip-flopping ‚ÄĒ it’s a technical term, trust us ūüėČ ‚ÄĒ of the market and what’s ¬†likely to be on investor radars next.

While some see pain as the market has fallen 2.5 to 2.7 percent depending on the index one is looking at, we see better prices for recently added positions like¬†Sherwin Williams (SHW)¬†and¬†United Natural Foods (UNFI)even though their thematic tailwinds continue to blow. We’re doubling down on these two names and another ‚ÄĒ details inside.

We’re issuing a Buy rating on speciality contractor¬†Dycom Industries (DY)and placing it on the Tematica Select List with a $115 price target, which offers more than 35% upside from last night’s closing price. While you may read speciality contractor and have a preconceived thought or two, Dycom is a crucial part in¬†working with¬†AT&T (T), Verizon (VZ)¬†and¬†Comcast (CMCSA)in expanding their¬†existing networks and deploying the next and future generations. That makes Dycom a¬†Connected Society¬†contractor in our eyes.¬†More details inside.

Any normal issue would not be complete without some updates on existing Tematica Select List positions. Because we’ve been away, we’ve got more than a few and that’s pushing this issue to the max (or at least 18 pages). All the latest and greatest, is¬†just a click away.

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As food prices drop we make a move on a Foods with Integrity thematic opportunity

As food prices drop we make a move on a Foods with Integrity thematic opportunity

In this week’s edition of¬†Tematica Investing:

  • Download Tematica InvestingWe are issuing a¬†Buy on shares of United Natural Foods (UNFI)¬†as part of our¬†Food with Integrity¬†investing theme. Our price target is $65, which offers more than 35 percent upside. We intend to build this position size over time and as such we are holding off issuing a stop loss recommendation at this time. ¬†Read full report >>
  • We‚Äôve got several Tematica Select List updates to share, including
    • AT&T (T)
    • CalAmp Corp. (CAMP)
    • Nike¬†(NKE)
    • Under Armour (UA)
    • And several others.¬†Read More . . .
  • Heads up! Just as you‚Äôll be coasting into the last days of summer, after adding 5 new positions in as many weeks we too will be taking some time off to recharge our batteries before the final push for 2016 begins. So, there will not be an issue on Wednesday, September 7.¬†Your next issue of¬†Tematica¬†Investing¬†will be on September 14.¬†

 

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Remaining loyal to our disciplined and thematic approach

Remaining loyal to our disciplined and thematic approach

The market move has turned more bearish of late, and we are not surprised Wall Street has adopted the more cautious stance we’ve had these last several weeks. A headline freak out on the April CPI report shows us just how nervous the stock market is these days. We’ll continue to be disciplined when contemplating adding each new position to the¬†Tematica Select List.

In this week’s edition of Tematica Investing:

  • Just doing it with Nike shares. We are issuing a BUY on Nike (NKE) shares with a price target of $66. Because this is an initial recommendation we are holding off with a commensurate stop loss, as we intend to build this position size over time. We would be buyers of Nike up to $59. Read More >>
  • Remaining¬†patient with Costco Wholesale (COST) shares
  • Adding share of EPR Properties (EPR), a Content is King company to the Tematica Contender List.¬†Read More >>
  • Quick Updates on AT&T (T), PetMeds Express (PETS), Regal Entertainment Group (RGC) and Disney (DIS).¬†Read More >>
  • This week‚Äôs Ask Tematica focuses on choosing between two different share classes.
  • As promised Thematic Signals returns this week, and there is no shortage of confirming data points for our thematic investing themes.¬†Read More >>

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As earnings kick into 5th gear expected volatility has us on sidelines, for now

As earnings kick into 5th gear expected volatility has us on sidelines, for now

We¬†are waist deep in March quarter earnings with more than¬†1,400 companies reporting¬†this week ‚ÄĒ a 40% increase compared to last week. Mixed in that horde are 124 S&P 500 companies (including¬†2 DJIA components) reporting. By the end of the week that will mean 87% of the S&P 500 group of companies will¬†have reported March quarter results.¬†

As we‚Äôve shared with you thus far, overall earnings expectations for¬†the S&P 500 group of companies has continued to trend lower since the end of 3Q 2015. The¬†expected volatility has us on the sidelines from¬†jumping on new positions . . .¬†for now. But that doesn’t mean we’re not busy sharpening our pencils¬†and getting ready for the right¬†opportunity.¬†

In this week’s edition of Tematica Investing:

  • Ahead of its May 9 earnings report, we are adding online pet pharmacy¬†Petmed Express (PETS)¬†to the¬†Tematica Contender List.¬†
  • Regal Entertainment (RGC)¬†rides the strong movie box office to beat earnings expectations.
  • A Tematica Investing subscriber question opens the door for¬†Amazon (AMZN)¬†shares.
  • We’ve got the latest thematic supporting data points that ripped from the headlines around us.
  • What did we enjoy this week? The Big Green Egg of course.

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