Apple, Under Armour, Axogen and a market fade
Big fade in the broader indices today, with the DJIA dropping more than 120 points from its early morning highs. I’m getting closer to nibbling on a few new stocks that I’d like to add to the portfolio, but just haven’t pulled any triggers yet. I would like the opportunity to buy some formerly high-flying stocks that have been hit hard despite strong growth fundamentals in a market panic or other broad sell-off. I do think we’re getting closer to a near-term sell-off than we to another rally, but that’s not something that we probably want to game other than waiting for great pitches. There’s value in reminding you not to trade just because you’re feeling restless or bored.
Speaking of formerly high-flying stocks, Under Armour took a big hit once again yesterday after missing estimates and guiding lower for 2017. The company’s a stealth App Revolution play that I’ve warned was too highflying for the last couple years, but I’m doubling down on my homework in the name and trying to see if there’s upside to the estimates for 2018 and into the next five years.
Meanwhile, how typical is this? I’ve had a huge position in Apple for years, as you all know, and here it is at the highest level it’s been at for a couple years and is almost hitting my target of $130. And all I can think about is how easy it would have been to be buying call options back when the stock was at $105 and I kept saying I thought it was headed back to $130.
Remember how many times I wrote this last year when $AAPL was languishing around $100?
“I do think $AAPL will reach close to $130 by the end of this year or into next year, and I’m holding my long-held large-ish $AAPL common stock position steady.”
Apple had a very strong quarter, selling more smartphones than Samsung for the first time in 5 years, and at a much higher margin. Remember that Apple gets all the revenue from the apps and cloud businesses that come along with the iOS smartphone, while Google gets all the revenue from the apps and cloud businesses that come along with their Android smartphones.
Anyway, steady as she goes for Apple, I’m just holding my common steady still.
Meanwhile, Axogen is hitting new all-time highs yet again, now up nearly triple from our first purchases back in October 2015. The stock is far from cheap now, and the valuation is getting a bit stretched at 8x 2016 revenues though that’s not as bad when you put the 40% expected growth for 2017, which puts the valuation at 6x next year’s revenues. That said, if you haven’t taken a little bit of profits on this stock at some point, you probably should trim 10% or so, just to be disciplined and lock in some of those gains.
Lots of solid discussion happening in the Chat Room this week as the market responds to Trump’s policies on immigration, the Feds and the $DJIA 20,000 mark. Don’t miss out on the daily discussions that are happening around trades, the economy and philosophical view points on trading/investing.
Don’t forget to join me live for today’s Q&A at 2:00 p.m. EST. If you can’t join me live, email your questions to support@tradingwithcody.com and we will get them answered.
