Cody Kiss & Tell: Gold, miners, chips, tech, stocks and crazy trains
All aboard! As my niece, Sofia, would say, “Dun dun, dun dun, dun dun. Aye, aye, aye” https://www.youtube.com/watch?v=3MLp7YNTznE
Ask my anything, I am here to help.
Q. Hi Cody. Saw you ruminating on $GDX over on Scutify yesterday. Getting any closer on a decision on that and what are your expectations of Gold’s reaction to Fed notes here any minute?
A. Well, I’m not going to force the $GDX trade, but I do think it’s probably a good short-term bet for the rest of the summer in addition to being a good mid-term bet for the rest of this cycle. I’ll let you know if and when I do risk some fresh capital on $GDX. Not yet. No idea how the Fed’s minutes are supposed to make someone sell or buy a physical metal in the next few minutes, and I wouldn’t try to game it right now.
Q. Cody, how big a correction do u think we get?
A. 5% minimum, 10% maximum, is my feet to fire guess for the Nasdaq over the next six weeks. Just a guess and I am not trying to game that though.
Q. What semiconductor is your top buy on a pullback?
A. I’m liking the semicap companies on a big pullback, if we were to get one. I’d love to scale into some $LRCX, $AMAT and/or $KLAC if they were to get smashed sometime soon. Can’t force the trade though.
Q. Cody, Where do you see Apple the second half of the year? Any price targets? Do you perceive Apple losing it’s edge to others?
A. I’d guess that $AAPL’s gonna top out near-term around the $100 level, maybe a few bucks above $100, just to wash out all the weak and momentum hands in the name right now. Then by year-end, IF they roll out some good products and new iOS and create some buzz/demand spike, the stock will get to $120 maybe? Feet to fire, again. Yes, with Jobs gone, $AAPL has definitely given up some of its edge. Still a dominant and very well positioned company.
Cody: Ask me about individual stocks today if you want to. I’ll do a blitz Revolution Investing analysis and a rating from 1-10 for any stock you ask me about before 3pm EST today.
Q. Fed says stop taper in Oct…what does that mean for gold and miners?
A. Imagine you’d been flooding your fields with excess water for five years straight and its all swampy and there’s places that have washed out completely and other places that are drying out. And then you announce to your crop that you’re going to stop flooding your fields with excess water for at least a few hours a day, but that for all intents and purposes you will continue flooding the fields. Taper is a distraction. The fields are flooded and there’s no drying them out without a complete revaluation of gold. Make sense? Who cares about tapering. The damage to the economy and our currency is already done. Gold will show that over the next few decades whether they taper this week or next month or stop all QE entirely tomorrow.
Q. Cody why is $SYNA outperfprming invn??
A. $IVNV and $SYNA have had almost identical returns for shareholders since $INVN came public 2.5 years ago. Both are still good Revolution Investing plays, I think. I’m putting a chart of the two stocks up on Scutify that I will paste here for you to look at. /content/images/img/scuttles/53bd8878d36feb0804dc6103.png
Q. How about $AVGO – Avago Technologies?
A. I’ve recommended $AVGO as a Revolution Investing play in years past and I sure wish I’d had it in the portfolio. I like the company a lot and their topline growth is thru the roof at 30% again this year on top of 60% last year. Revolution Investing Rating: 7/10
Q. I would like to know how you rate $GLUU.
A. $GLUU will likely head toward $8-9 a share if they can deliver on the 20% topline growth and 15 cents per share in earnings as the analysts are estimating for the company. It’s a small cap, $100MM in total sales, startup kind of a play though, and too risky for me. Rev Inv Rating: 6/10
Q. Hey Cody. What is your opinion on $CODE?
A. $CODE “Spansion, Inc. designs, manufactures, develops, and sells embedded systems semiconductors worldwide. The company offers flash memory, microcontrollers, mixed-signal and analog products, and embedded system-on-chip solutions. It provides a family of parallel and serial NOR flash memory, as well as a range of lower density NAND flash memory products for non-commodity embedded applications.” Great sectors to be in, but this is a commodity-chip company and with the 25% or less gross margins, I’m not very into it. I prefer $SNDK and $INVN in the similar markets. CODE Revolution Investing Rating: 5/10
Q. Hi, Cody. Revisiting Radio Shack. Last time it came up, your feeling was that even though it’s a broken biz model for sure, in this lotsa-free-money-out-there environment, someone might jump in to prop it up (if I stated that correctly). Yet since then, the stock has continued to slide, now below a buck (risk of a changed-listing, right?) TWO questions: (a) still have the same feelings about $RSH (i.e., bad shape but could be saved), or is it in an inevitable decline; and (b) were it to get to the point of bankruptcy –do you consider that a possibility, BTW? — would you say it’d be a good candidate for our “bankruptcy play”? There must be HUGE shorts in it right now. Thanks for both answers, Cody.
A. I still think it’s unlikely that $RSH ends up bankrupt sometime this year, but if it does happen — heck yeah, it’d be a great set-up for our Post-BK trade, that is buying it the day it files and selling it a few days/weeks later as shorts cover their huge wins and move on.
Q. What are your thoughts on $BBRY which has been trading up recently: at what level do you think you might begin to look at shorting or buying puts?
A. Ooh, I like your thinking on this one. I’d look at some $10 or even $9 strike prices, dated out as far as we can go on the expiration dates. I’ll put $BBRY back on my screen and I might join you on that trade at some point soon. Let you know if/when of course.
Q. Latest thoughts on Herbalife?
A. Still think $HLF is headed much lower over time, but no idea when or if I’ll try to enter a short position or buy some puts on that one.
Q. Cody is $ATHN a short??
A. Not the time to try to game the healthcare lobbyists’ ability to get their Republican/Democrat puppets to increase $ATHN’s profiteering on taxpayer money, IMHO. I’d sure rather be short $ATHN than long it when the end game of Romney/Obamacare finally gets here, but that’s a long time away.
Q. Last week i was on the beach trying to write to you but i could not see the screen in the sun on my i5, i hope they come up with a new screen, any idea yet on what to do with the balance of our July calls?
A. I’m still holding a few of the $AAPL call options and nothing’s changed on the trade except that the risk is higher now with the value of the options up. Trim some if you’re stressed about losing money on them from these levels in the next ten trading days, as that’s all we have left on the time for this trade and we’ve made huge money so far, so don’t push it.
Q. I have 5 left was thinking about converting them, your opinion?
A. If you want to own 500 shares of AAPL and it won’t overweight you in that one stock, then nothing wrong with converting your winning call options into shares.
Q. Thanks, if i covert the calls do you do it on the last trading day? I never converted before.
A. Typically, your broker will automatically convert your call options if they are in the money and expire. You should see it in your account on the Monday after. You might want to call your broker and make sure though.
Q. What is the pure play gold investment do you recommend. I think you dislike the GLD because it doesn’t hold the physical gold. Thank you..
A. That is correct. I think GLD assets will be worth the same that Mortgage Backed Securities that were sold from 2005-2007 were worth in 2008, that is NOTHING. There’s not enough gold at GLD to give to every shareholder they’ve promised it to. Buy physical gold coins and bullion and make sure they are stored somewhere you can see them and get them even if the banks were to close some day.
Q. Where do you see FIO heading short and long term. Have some shares and wondering if there is potential for it to go up.
A. FIO was bought by SNDK, so even until the deal closes, FIO’s shares will pretty much trade in tandem with SNDK’s shares.
Q. Your current stance on NQ?
A. NQ is still a horrible stock. Wish I’d shorted it when I kept writing that the first times.
