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☕ Stocks like this one could still have a parabolic move

Jan 24, 2024

Good morning! 👋

I saw two possibilities this week when I wrote to the OBA Family in a special Sunday alert: a) quick rug pull Monday morning to clear the pipes or b) a continued run higher through the balance of the week into earnings.

Now, there’s a new wrinkle.

The green on the screen suggests that traders may try to push higher all the way into big tech earnings. That's great if you’re on board but can be frustrating if you’re not and trying to catch up.

Whatever you do, resist the temptation to pile in all at once.

Stick to the plan
Buy smaller
Think bigger

The last thing you want to figure out as an investor is that you’ve been speculating.

The markets always reward discipline.

There is NO rush.

Here’s my playbook.

1 – I’ll just say it... the end of Boeing

It’s a far more common tale than you’d think.

Great companies fail regularly and Boeing certainly seems to be on that path.

The FAA has taken the extraordinary step of dispatching dozens of inspectors to Boeing’s production lines where they will remain until the watch-dog is convinced that Boeing’s quality control systems are working the way they are supposed to. (Read)

What I am about to say is going to go over like a lead balloon.

I think it’s entirely possible that what’s happening is the beginning of the end for Boeing's commercial aircraft business. Doors popping out midflight, wheels coming off, crashes and more.

Long Airbus, short Boeing.

MyPOV: And for those of you reading along who are inclined to say, “no way” or something similar, I urge you to think about how Kodak, Wang, Eastern Airlines, and other names were once among the world’s most respected companies. Then read or re-read Tom Peter’s seminal 1982 work, In Search of Excellence.

2 – AMD gets an upgrade

Wedbush analyst Matt Bryson raised his AMD price target from $130 to $200. (Read)

Good thing, ‘cause you know... it’s already trading at $168.42. 🤦‍♂️

My own target remains $187.31 for now, but I’m beginning to think about the math involved on a path to $225+.

Positively parabolic!

Keith’s Quick Tip: Investors who feel like they’ve missed a stock like AMD often fall prey to FOMO – fear of missing out – when the stock takes off without ‘em. That's normal and you wouldn’t be human if you didn’t feel a twinge of regret or impatience. Harness that and turn your focus to building a position, not throwing caution to the wind and buying one all at once which is behaviour best reserved for the tables in Las Vegas.

3 – Tesla reports

There is very little new information I can share with you about Tesla at this point.

The street expects a significant impact from price cuts, margin pressures, delivery challenges, and more. (Read)

Yet, Wall Street still owns huge chunks of it.

Ross Gerber, a long time Tesla shareholder even called CEO Elon Musk the most delusional CEO he’s ever invested with. (Read)

Yet, he and his firm apparently still own shares.

In fact and according to Yahoo!Finance, institutions hold 44.97% of the stock.

Here’s the thing.

Negative noise is often an attempt to separate you from your money this week or over the next five days. No, strike that... more often than not.

Tesla has returned 1,696.74% over the past decade versus 225.03% from the S&P 500 over the same time period acording to finmasters.

Do you really think Unka Elon has started taking stupid pills?

It’s okay if you do.

I don’t.

The company is where Apple was right before it launched into the stratosphere. My colleague Dan Ives and I share the opinion that 2024 could be a golden year for Tesla in that sense.

Chaos creates opportunity.

Think about it.

If the stock drops, you can buy it at a discount, sell cash-secured puts, buy spreads or simply continue to accumulate shares.

There’s always a way into the fight if you want one.

And fine if you don’t.

OBAers: Stick to the three high-probability strategies I laid out in the alert I've just mentioned. It's available in your archives.

4 – Netflix jumps as password crackdown fuels subscriber surge

No surprise here.

Data shows that companies can lose up to 45% of revenue because of account sharing.

We run into it constantly.

I am aware, for example, of several individuals who are probably reading along right now and who are using our research to drive their own businesses with no credit or compensation given for the concepts, thoughts and data they’ve stolen, err “borrowed.” Others are sharing their logins to our paid research with people who haven’t signed up for their own memberships.

It’s a technology pandemic and a growth strategy.

Netflix stock is getting pricey enough that I can envision a split ahead.

I’d rather own other stocks right now including many of the companies we talk about frequently but there’s a case to be made that having a few NFLX shares sitting around could play out nicely a year or two from now.

5 – This is too cool to pass up

I’m a big fan of contemporary design, especially when it has clean lines that remind me of both Japan and mid-century architecture.

You and five of your closest friends can stay at architect Philip Johnson’s Wolfhouse, a 1949 residence on the Hudson, that’s just been restored using original materials from the Columbia University archives.

It’s apparently one of the most loved homes on Airbnb.

Noriko and I are already planning on a visit this summer when we’re on our cross-country motorcycle expaganza.