Get Set for Profitable Cyclical Stocks
Following the peak of the pandemic last March, investors clung to companies that could survive in a bear market ... and even a recession.
Now, with cash flowing into the economy — thanks to stimulus payments and rock-bottom interest rates from the Federal Reserve — it’s time to capitalize on cyclical stocks.
“Cyclicals are companies whose businesses depend on the rise of the economic cycle to be successful,” says Jon Markman, senior analyst and editor of Markman’s Pivotal Point.
According to Jon, “In the past two or three months, investors have decided that the economy would do much better once the vaccines become more readily available. Then, people would begin to travel again, people would begin to go to hotels again, people would buy cars again.”
Jon favors cyclicals right now, as he sees major obstacles with certain growth stocks. “One of the problems with growth stocks, particularly ones with very little earnings, is that they become very overvalued at the end of their cycle.”
In this special four-minute video segment, Jon highlights cyclical industries that are thriving in this current financial climate. One of them is the automotive industry, where companies have promised to pour billions into electrifying their fleets.
The auto industry is the ultimate cyclical industry. It only does well when people have a lot of money in their pockets.
But what’s super-interesting right now, is that there’s a huge move throughout the industry, to move to electric vehicles and autonomous vehicles.
And in order for The Ford Motor Co’s. (NYSE: F), and General Motor Co.’s (NYSE: GM) and Volkswagen AGs (OTC: VWAGY) of the world to do that, they’ve got to completely re-tool their factories.
I really believe toward the end of this period, people are going to start looking at Ford and General Motors as technology companies, rather than mobility service providers ... rather than just big old industrial cyclicals.
I’m looking for the Fords’ and GMs’ to surprise people, by rising more than Tesla, Inc. (Nasdaq: TSLA) over the next two years.
In this insightful video, Jon discusses:
• His prediction on how much Ford and GM’s price-ratio earnings will soon rise.
• The company at the forefront of revolutionizing a major cyclical sector.
• By how many percentage points two main credit card companies will soar over the course of months ... and why.
• Jon’s profitable pick: an “obscure stock that dominates its niche.”
The information in this short segment couldn’t be timelier. I suggest you watch it now.
Markman’s Pivotal Point