SPECIAL ALERT: The November episode of the Zacks Ultimate Strategy Session will be available for viewing no later than Wednesday, November 11. Kevin Matras, Dr. John Blank, David Bartosiak and Sheraz Mian will cover the investment landscape from several angles in this popular event.
Don’t miss your chance to hear:
▪ Sheraz and David Agree to Disagree on the sectors best positioned to perform in 2021 and beyond
▪ Kevin answers your questions in Zacks Mailbag
▪ Sheraz and John choose one portfolio to give feedback for improvement
▪ And much more
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A few more days like this and the market will have made up last week’s deficits in no time!
On Election Day, the Dow skyrocketed by 2.06% (or nearly 555 points) to 27,480.03, while the NASDAQ jumped 1.85% (or about 203 points) to 11,160.57. The S&P improved 1.78% to 3369.16.
The Dow has jumped nearly 1000 points in two days!
Partisans on both sides of the political divide will probably tell you that that these rallies are foreshadowing success for their particular candidate.
However, the market is really just hoping that we can clear up one of the many uncertainties lingering in the air right now. It’s been a long time since we’ve left a major concern in the rear-view mirror, and this would be a great time to do just that since the pandemic is still raging.
As we’ve been saying for months, individual investors certainly have their own preferences, but the market as a whole would be fine with either of these guys being president.
But it wouldn’t be fine with an unresolved election that could drag on for weeks or months in the courts. Could you imagine rising coronavirus cases AND a 2000-style political fight being played out in several states?
That’s why the market is screaming: “Would somebody just win!”
All right, so let’s assume the market gets its wish and somebody gives an acceptance speech tonight… or we at least know who will eventually be giving one. There’s still plenty of other things happening this week.
A new Fed meeting starts tomorrow, and you can bet that Chair Jerome Powell will be stressing the need for more stimulus to whatever administration will be handling the next four years.
Meanwhile, earnings season continues and the Government Employment Situation report will be released on Friday.
So get out there and vote if you haven’t already, but don’t relax because there’s still much to do this week.
Today's Portfolio Highlights:
Stocks Under $10: Biotechs are known for operating at a loss, so Brian really pays attention when one makes the turn to profitability. Case in point, Avid Bioservices (NASDAQ:CDMO) announced a six-cent profit in its most recent report. Furthermore, rising earnings estimates have made the stock a Zacks Rank #2 (Buy). Current year growth is expected at nearly 78%, while next year spikes to a robust 266%. The editor likes what he sees and added CDMO on Tuesday. Read the full write-up for a lot more on this new addition. In other news, this portfolio had a top performer on Tuesday with Diebold Nixdorf (NYSE:DBD) rising 12.5%.
Surprise Trader: It looks like Wolverine World Wide (NYSE:WWW) is on its way to an impressive 20th straight quarterly surprise. This apparel and footwear company has a positive Earnings ESP of 5.26% for the report coming before the bell on Thursday, November 5. It beat by more than 160% last time, which was the 19th straight quarter of outperformance. Dave added WWW on Tuesday with a 12.5% allocation. Get more specifics on this new buy in the full write-up.
Marijuana Innovators: There’s some “significant good news” and some “legitimate reason for caution” when it comes to Aurora Cannabis (NYSE:ACB). However, the stock is too cheap right now, so Dave added it on Tuesday. He suggests you “tread lightly” and read his complete commentary on this new addition. ACB is a Canada-based company engaged in the production and distribution of medical cannabis.
Healthcare Innovators: It takes a lot for Kevin to lose heart with a gene-editing biotech, but that’s what has happened with Editas Medicine (NASDAQ:EDIT). First of all, the stock can’t seem to get above its August highs and could potentially break its 200-day MA. But the real problem was a big negative call by a major brokerage firm, citing “limited market opportunity for the company’s lead indication”. The editor decided to get out of EDIT now and secure a return of approximately 41%. Don’t worry though, the portfolio still has plenty of exposure to the innovative CRISPR technologies.
Value Investor: This portfolio has been very patient with GW Pharmaceuticals (OTC:GWPRF) (GWPH), as this biotech focused on cannabinoid therapeutics hasn’t done much since being added. However, that may be about to change. The company recently reported strong third-quarter results with better-than-expected earnings and revenue. GWPH stock soared 21.2% on Tuesday, which easily made it the top performer among all ZU names. It’s now positive in the portfolio as well. This portfolio also has a top performer over the past 30 days as Pinterest (NYSE:PINS) is up nearly 36%.
Zacks Short Sell List: The three stocks that were short-covered in this week's adjustment all brought profits to the portfolio. Those names that left the service today included:
• The Trade Desk (NASDAQ:TTD, +9.5%)
• ConocoPhillips (NYSE:COP, +8.8%)
• Canada Goose (GOOS, +7%)
The new additions that filled those gaps today were:
• American Tower (NYSE:AMT)
• Moderna (NASDAQ:MRNA)
• Sociedad Quimica y Minera (SQM)
Learn more about this emotion-free portfolio that takes advantage of falling and volatile markets by reading the Short Sell List Trader Guide.
Have a Great Evening,
Jim Giaquinto
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