Justin Carley

Editor's Choice

  • Good Luck Getting a 10% Return From Your Bond Fund!

    By Justin Carley - June 27, 2013 | Tickers: BUD, AGG, RCI, VZ | Editor's Choice

    The Fed may or may not get their forecast right regarding employment and the timing of QE tapering. But one thing is for certain, they have made it clear that bond funds can lose money very quickly. The iShares Core Total U.S. Bond Market (NYSEMKT: AGG) is a proxy for a conservative bond portfolio with 44% in U.S. Treasuries, 31% in mortgage back securities, 24% in investment grade more »

  • Wide Moat Stocks- Not As Many As You Think

    By Justin Carley - February 6, 2013 | Tickers: DELL, HPQ, YUM | Editor's Choice

    Dell’s (NASDAQ: DELL) $24.4 billion dollar LBO puts the final nail in the coffin on one of the great stock stories of all time.  The company would go public in 1988 and could easily be classified as the stock of the decade during the 1990’s.  During that decade, the stock would appreciate at an annual rate of 97%!  However, the next decade would be a completely different more »

  • An Analysis of Barron’s 10 Stocks for 2013- Part I

    By Justin Carley - December 19, 2012 | Tickers: AAPL, BKS, BLK, F, GD, JPM, TXT | Editor's Choice

    Barron’s is out with their 10 favorite stocks for 2013.  I highlighted their performance in 2012 and they did a good job with market-beating success.  These lists always elicit plenty of emotions from investors of all varieties, but it helps to put a little context into the picks.  First, I believe Barron’s tilts toward the large-cap space and seeks a group beta roughly in-line with the S&P more »

  • Lower Risk Stocks as we Approach "The Cliff"

    By Justin Carley - November 5, 2012 | Tickers: BUD, BEAM, DEO, STWD | Editor's Choice

    Finally, the election is upon us and we can all escape the political rhetoric SOON.  However, the feeling of relief may not last long as attention will quickly turn to the looming fiscal cliff and its impact on the economy and markets.  I recently highlighted why investors need to maintain an overweight position in equities; however, there are real risks that could have real consequences on one’s portfolio.  While more »

  • 1 Must Own Stock for Bullish Investors

    By Justin Carley - June 11, 2012 | Tickers: COP, MPC, PSX, TLLP, VLO | Editor's Choice

    I would like to highlight one stock that every investor needs to get familiar with.  It is a company that was spun-off from its parent in 2011, has substantial dividend growth opportunities, sports a P/E ratio of 5x, has seen analysts recently raising earnings estimates, doesn’t get any income from the beleaguered European continent, and has one home run catalyst waiting to be unleashed in 2012.  Does that more »

  • 2 Stocks that Make Bond Investors Look Foolish

    By Justin Carley - May 31, 2012 | Tickers: AMLP, BWP, EPB, EPD, L | Editor's Choice

    Natural gas prices are up 45% from their April low!  Is this the start of the coming surge that just had to happen ever since the price broke below $5, $4, $3, $2?  Not likely.  I detailed in a mid-April piece to stay clear of E&P companies with heavy reliance on natural gas.  It is still early and the context was based on a time horizon on two or more »

  • Share Repurchases - 'Yeah, but…?"

    By Justin Carley - May 25, 2012 | Tickers: HPQ, NES.DL, REGN, STX | Editor's Choice

    There are plenty of investing myths out there that often form the backbone of headlines or recommendations.  Investors need to continually evaluate the empirical evidence and question the embedded assumptions.  Take for instance insider buying.  If the CEO is buying and they know the business intimately, then it must be a buy, right?  WRONG.  Investors should ignore any recommendation that is based on such a theory.  How about market sentiment-  Horrible at predicting market tops, but a good tool at identifying bottoms.  By selling when the sentiment surveys get elevated, investors are making a key mistake.  Whereas, they are well served to buy when they see headlines highlighting sentiment levels at multi-year lows.  Today, I would like to discuss one the biggest market misconceptions- share buybacks.  Many stock recommendations use the notion of the company buying back stock as a key pillar in their thesis.  However, investors should be very cautious of these enticing statements and shouldn’t think that share buybacks can mask business weakness.

  • 1 Golden Mean Reversion Opportunity

    By Justin Carley - May 21, 2012 | Tickers: AEM, ABX, GDX, GLD | Editor's Choice

    Gold continues to be a hot topic of investing even if it has been slumping of late.  It doesn’t hurt when you have Charlie Munger,  Warren Buffet’s right hand man, recently quoted as saying,

     “I think gold is a great thing to sew into your garments if you're a Jewish family in Vienna in 1939, but I think civilized people don't buy gold. They invest in more »

  • Buy the Dip - 3 Reasons and 3 Stocks

    By Justin Carley - May 9, 2012 | Tickers: CSCO, PRGO, WYN, WYNN | Editor's Choice

    The consensus believes that brown shoots are here and the economic train will derail for the third summer in a row.  The S&P 500 dropped 8% during the month of May in 2010.  In 2011, the month of May was the start of a near 20% correction in domestic equity markets.  And here we are again; the market is rolling over on softer U.S. economic data and European more »

  • Avoid this Bear Trap

    By Justin Carley - April 11, 2012 | Tickers: ACI, CHK, ECA, RRC | Editor's Choice

    We would be rich if all it took to generate consistent, market-beating returns was buying stocks with cheap price-to-earnings ratios or those that have fallen significantly in value.  Mean reversion usually works, but sometimes it doesn’t, and when it does the timing surprises nearly everyone.  Those instances when cheap stocks stay cheap, or god forbid fall further, are known as value traps.  

  • Two Buy and Hold Commodity Stocks

    By Justin Carley - March 9, 2012 | Tickers: APA, BBL, CLF, VALE, ECA | Editor's Choice

    Do you favor the long-term outlook for commodities, but feel that timing the cycles is futile?  Do you want to buy and hold a few stocks that are levered to commodity prices in the anticipation that they will outperform over the next decade?  For investors that are in such a situation, I have two stocks that merit attention today.  Not only that, but these two stocks are diversified and shouldn’t get crushed during bear market pullbacks.  Their volatility should be less than peers, albeit still higher than the average stock in the S&P 500. In a nutshell, these two stocks are great buy and hold candidates in the commodity space.

  • These 2 Popular Dividend Stocks are about to Underperform

    By Justin Carley - February 22, 2012 | Tickers: T, VZ | Editor's Choice

    Market participants have been clamoring over dividends and have thus far reaped the rewards.  But ultimately it is earnings that drive stock performance and a popular source of dividends is set to underperform: Telecommunication Services.  The two stalwarts in this industry, AT&T Inc. (NYSE: T) and Verizon Communications Inc. (NYSE: VZ), with market capitalizations above $100 billion and dividend yields above 5%, should be sold because underperformance is likely more »

  • Hold Off On Hospira

    By Justin Carley - February 14, 2012 | Tickers: BAX, CFN, HSP | Editor's Choice

    Hospira (NYSE: HSP) reported 4Q11 results this morning and shares are up more than 6% as the session nears an end.  The results were awful thanks to a terrible 2011 that was highlighted by FDA warning letters and plant shutdowns.  Actual earnings-per-share for the fourth quarter was -$1.30 due to plant shutdowns and other remediation costs.  So what has the shares moving higher?  First off, the key plant in more »