John Dorfman Columns category, Page 10
John Dorfman: Schwab and Lennar exemplify value plus growth
The philosopher’s stone was a myth. So was the fountain of youth. But here’s something that sounds unlikely, yet is feasible. You can get both value and growth in the stock market. Value investors seek bargains. Growth investors seek companies with fast-growing earnings. There’s an inherent tension there. Bargain-priced stocks...
John Dorfman: LGI Homes and Progressive show rapid revenue growth
One sign of a good stock is rapid revenue growth. Sure, profits are what ultimately count. But you can’t grow profits for long unless revenue is growing too. Right now, some investors are chasing companies with fast revenue growth but scant earnings or none — the likes of Uber Technologies...
The Perfect 10 Portfolio rides again
In 2015, one year before he became president, Donald Trump remarked that supermodel Heidi Klum was “sadly, no longer a 10.” Klum good-naturedly responded by wearing a T-shirt marked 9.99. What is always a 10? My Perfect 10 Portfolio. It contains 10 stocks, each of which is priced at 10...
John Dorfman: Biogen and Southwest are on the Casualty List
Texas opened its bars and then closed them again. Apple Inc. opened its stores and then re-shut 32 of them. Walt Disney Co. has postponed the reopening of its theme parks. These are just some of the hundreds of ripple effects from the pandemic. In a climate of rampant uncertainty,...
John Dorfman: Hit hard this year, these 4 stocks may rebound
On Wall Street, FOMO means fear of missing out. I think what many investors are feeling now is not FOMO but FOHAMO — fear of having already missed out. The stock market’s waterfall decline in February and March created some bargains, but with a virus-led recession starting, many investors were...
John Dorfman: T. Rowe Price, Align Technology, PetMed Express show high profit, low debt
Ask some average investors how to identify a company that’s doing well. They will probably reply, “Good earnings growth and a rising stock price.” Well, sure, those things are fine. But I feel that most investors neglect at least two other important characteristics: high profitability and low debt. High profits...
Tailoring portfolios to coronavirus and recession
February through May, my firm has been recasting our clients’ portfolios to reflect a continuing coronavirus epidemic and a recession of unknown length. We maintain a Model Portfolio, and about three quarters of our client accounts track it pretty closely. Here are the stocks in it, all of which I...
Insider buying at Carrier, Greenbrier and Zion
Three CEOs took million-dollar bites of their own cooking in May. At Carrier Global Corp. (CARR), which makes heating and air conditioning equipment, Chief Executive David Gitlin spent just over $1 million to increase his stake. At Greenbrier Companies Inc. (GBX), which manufactures rail cars, a trust connected with CEO...
Newmont stock has doubled, and it still looks good
Newmont Corp. (NEM), the largest U.S.-based gold mining stock, has doubled in the past year. Too late to buy? I don’t think so. I believe there are more gains to come. Despite the bear market brought on by the coronavirus, close to 4% of all U.S. stocks with a current...
John Dorfman: 4 stocks you should sell right now
Weeding isn’t just for gardens. I recommend that investors weed their portfolios at least once a year. Since the United States faces a recession — a stiff one, in my view — this is a good time to look at your holdings and weed out companies that have high debt,...
Give me that old time religion: Low-debt stocks
I love low-debt stocks. Companies with little or no debt have staying power when an unexpected emergency pops up — the current pandemic, for example. They almost never have to sell a promising division because they need cash. They may be able to launch new initiatives, make acquisitions or increase...
John Dorfman: A handful of ways to invest defensively
I never abandon the stock market utterly, and I don’t think anyone should. But when a recession looms, it makes sense to get more defensive. That means investing in sectors that usually withstand bear markets and recessions fairly well. Traditional choices include consumer staples, gold, health care stocks, tobacco and...
No baseball, but my 30-30 Club continues
Among other pleasures quashed by the pandemic, the baseball season will be delayed (let’s hope not canceled). However, as a minor consolation, my 30-30 Club continues. In baseball, the 30-30 Club contains players who have hit 30 home runs and stolen 30 bases in the same season. In the past...
John Dorfman: Now look closely at the Stock Market Casualty List
The market’s battlefield is littered with casualties. Each quarter I write about stocks that have been wounded and that I think have excellent recovery potential. I call it the Casualty List. This quarter there are many candidates: Dozens of solid stocks are down 40% or more. Blame the coronavirus and...
Dorfman: Stock-picking winner pessimistic about market’s recovery
Laurent Condon, a retired trader in Saint-Rambert-en-Bugey, France, won my stock-picking contest, Dorfman’s Three-Stock Derby, for 2019-20. This was the fourth time Condon has won honors in one of my contests. He won my short-selling contest in 2017-18 and finished third the following year. Last year, he finished third in...
5 Nasdaq stocks for the moment you’re ready to buy
The time for bargain hunting in the virus-afflicted stock market may not have come yet. But it will come. Guessing when we have hit bottom will be an art, not a science. It will be partly a matter of judgment and feel. When you are ready to wade back into...
2 CEOs make million-dollar buys
Two CEOs have made million-dollar buys of their company’s stock in February and March. At Continental Resources Inc. (CLR), CEO William Berry spent $1.6 million to increase his holding by 90,000 shares. He now owns 931,301 shares, worth about $13.8 million at Friday’s prices. Berry has been Continental’s CEO only...
John Dorfman: Student in Milan, Italy, wins my forecasting derby
A student at the American School in Milan, Italy, won my annual Derby of Economic Forecasting Talent (DEFT) for 2019. Gregorio De Giuli, a 17-year-old high school senior, modestly attributed his success to “luck,” but there was more to it than that. “I looked at charts and followed the trend,”...
John Dorfman: No one wants Chinese stocks now — and that’s why you should
Sir John Templeton, one of the greatest investors of the 20th century, famously said you should invest “at the point of maximum pessimism.” At various points in his career, he did that in the United States, Japan and New Zealand. Now, I think investors have the chance to do something...
John Dorfman: 3 stocks that are way more expensive than Tesla
If you want a stock market bet that’s 74% likely to lose money, try investing in high-flying stock that sells for 100 times revenue or more. I call such investments “near insanity,” because in the vast majority of cases, these stocks crash back to earth. How dizzying is 100 times...
Alphabet heads my list of balance-sheet powerhouses
The wealthiest people don’t always have the biggest salaries. And the wealthiest companies aren’t necessarily those with the best earnings lately. I believe that companies with a great balance sheet deserve recognition. So, in 2001 I started compiling an annual list of Balance Sheet Powerhouses. To make it, a company...
HP, Progressive show value and momentum
The stock market in the past couple of years has been a momentum market in which rich stocks get richer and poor stocks get poorer. That may change fairly soon. But for the moment, investors would be smart to look at stocks that possess both value and momentum. Here, folks,...
John Dorfman: Screwy January isn’t going by the book
When I was a boy, my father took me to the race track. I was entranced by the Daily Racing Form, which contained a wealth of information about every horse’s past performance. “There’s one problem,” my father said. “The horses don’t read the form.” As I look at the stock-market...
Marathon Petroleum, Auto Nation make quarterly Casualty List
Buying the stocks of good companies on bad news is my favorite investing method. The trick is to find bad news that is real but probably temporary. Each quarter in this column, I compile my Casualty List. It highlights stocks that have been pummeled in the latest quarter, and that...
All 4 of analysts’ favorite stocks fell last year
The four stocks that Wall Street analysts most adored a year ago all fell. The analysts’ darlings as of January 2019 posted a 15% loss from Jan. 14, 2019 through Jan. 10, 2020. This happened even as the Standard & Poor’s 500 Index, widely used as a gauge of the...
