The Catalyst Powering Small-Cap Strength

Small-cap stocks have been soaring lately.

The Russell 2000 index just hit a 52-week high on Monday and has risen 22.9% year-to-date, overtaking the Dow’s and NASDAQ’s gains over the same timeframe and coming in just behind the S&P 500’s 24.2% gain.

My Breakthrough Stocks, on average, have continued to benefit from an early “January effect” that begins as yearend pension funding, annual gift-giving and other positive seasonal events create buying pressure on higher trading volume.

An early January effect tends to significantly boost small-cap stocks, which is great news for my Breakthrough Stocks. As a result, they tend to flourish between November and May. I must say that after more than 40 years of publishing, I’m still amazed at how small-cap stocks often surge this time of year.

This played out late last year and into this year. You can see in the chart below how the Russell 2000 grew over 35% from November 2020 through mid-January 2021.

Given the Russell 2000’s strength this year, I expect history to repeat itself. I should note that, generally speaking, November, December and January are historically the three best months for the stock market. In fact, the Dow Jones Market Group reports that the S&P 500 and Dow both gain about 3.4% during this three-month span, while the NASDAQ tends to rally 6.3%. So, we have three months of seasonal strength in front of us!

Now, there are a couple of risks investors need to keep their eye on. But the one folks are most concerned about right now is inflation.

Consumer prices, as tracked through the Consumer Price Index, climbed 6.2% in October from a year prior, which represents the largest rise in over 30 years, and the fifth consecutive reading above 5%. Higher prices for natural gas, gasoline and used cars were a significant cause of the price gains in the index.

The Labor Department also reported October’s Producer Price Index jumped 8.6% from a year ago, the fastest increase in 11 years.

In fact, inflation has become a global problem. China’s latest Producer Price Index soared 13.5% from a year earlier, its fastest growth rate in 26 years.

Interestingly, central banks around the world want to do nothing about it so far and I think it’s sad they think and move in unison like that.

Higher inflation tends to leave investors with limited options to look for yield. Real estate is one possibility, though there are signs the housing market is cooling a bit. The median price for a single-family home in the third quarter increased 16% to $363,700, according to the National Association of Realtors. That was down from the 23% rise in the second quarter.

That leaves fundamentally superior stocks as an excellent inflation hedge. Fact is, many high-growth tech companies can raise prices as inflation rises.

Case in point: my Breakthrough Stocks.

Overall, they’re characterized by 52.5% average annual sales growth and 401% average annual earnings growth. So, I remain very optimistic that my Breakthrough Stocks will continue to post substantial earnings surprises and garner more and more investor attention in the upcoming months.

The bottom line: The current confusing, inflationary environment is causing a major stock market rotation into quality stocks that are characterized by strong sales and earnings momentum. The stock market is now shifting its attention back to fundamentally superior stocks, and money is increasingly flowing into my Breakthrough Stocks.

Now, if you join me at Platinum Growth Club, you will have access to this Breakthrough Stocks’ November Monthly Issue and my three newest recommendations and more than 100 stocks across all my services and nearly 30 LEAPS call options, and each and every one boasts strong sales and earnings growth.

I handpick all of my Model Portfolio recommendations from my different stock services – Growth InvestorBreakthrough Stocks and Accelerated Profits – so you can rest assured that you’re investing in the best of the best.

Of course, you don’t have to invest in all 100+ stocks to grow and prosper this year. If you’d rather start small, I have you covered there, too. My Platinum Growth Club also comes with my exclusive Model Portfolio. I handpick all of my Model Portfolio recommendations from my different services, so you can rest assured that you’re always invested in the crème de la crème.

Sign up here now so you don’t miss out!

Sincerely,

Signed:
Louis Navellier

The Editor hereby discloses that as of the date of this email, the Editor, directly or indirectly, owns the following securities that are the subject of the commentary, analysis, opinions, advice, or recommendations in, or which are otherwise mentioned in, the essay set forth below:

 

The 3 Catalysts Lighting a Fire Under the Market’s Belly

The stock market has been almost unstoppable recently. Until today, the S&P 500 had notched eight record closes in a row. And yesterday, the Dow, NASDAQ and even the Russell 2000 all broke through to new all-time highs.

The reality is there are three catalysts lighting a fire under the market’s belly. First, we have the Federal Reserve. As I discussed last week, the Fed decided it will start this month to reduce, or “taper,” its recent quantitative easing policy, with a plan to bring it to a full stop by June. Now, Wall Street was anticipating the Fed to curtail its quantitative easing by up to $30 billion a month. Instead, they only decided to do $15 billion per month. That’s nothing. So, that was a huge surprise. And during Fed Chair Jerome Powell’s press conference following the FOMC statement, he refused to say whether the central bank is going to raise interest rates. So, the Fed is still dovish and willing to prime the pump.

It’s clear to me that the Fed remains obsessed with trying to create more jobs. I should note that there are four million jobs missing since the pandemic. But the labor force participation rate is down because some folks chose to retire. And yet, the Fed wants to replace these four million jobs because that’s its mandate.

But the fact of the matter is the economy became more productive as a result of the pandemic. Technological change was also accelerated. It’s one of the reasons for the earnings explosion. You may recall that in the second quarter, S&P 500 earnings grew more than 90% year-over-year and revenue rose more than 25% year-over-year. According to FactSet, for the third quarter, S&P 500 earnings are estimated to increase 39.1% year-over-year and revenue is expected to climb 17.3% year-over-year. So, while earnings growth is decelerating a bit, the third-quarter earnings season is nothing to sneeze at.

Wall Street Refocuses on Earnings

Let me add that investors are growing more fundamentally focused, which is why I’ve been so “gung-ho” on fundamentally superior companies. Yes, investors can become distracted at times and get hooked on weird little themes every now and then, but they are absolutely refocusing on earnings right now. It’s why we’ve seen the stocks I discussed last week – Atlassian Corporation Plc (TEAM), InMode Ltd. (INMD) and Enphase Energy, Inc. (ENPH) – surge on their quarterly results.

On the other hand, just today meme stock AMC Entertainment Holdings, Inc. (AMC) fell more than 9% in the wake of its third-quarter earnings results yesterday afternoon. For the third quarter, the company reported an earnings loss of $0.44 per share on revenue of $763.2 million. Analysts were expecting an earnings loss of $0.53 per share on revenue of $708.3 million, so AMC beat on the top and bottom lines. However, global movie attendance was lower than expected. AMC saw global attendance of 40 million, which was below analysts’ expectations for 42.8 million.

In addition, company management was a little pessimistic during the earnings call, stating: “We wish to emphasize that no one should have any illusions that there is not more challenge ahead of us still to be met. The virus continues to be with us. We need to sell more tickets in future quarters than we did in the most recent quarter, and adjusted EBITDA is still well below pandemic levels.” So, AMC is still bleeding cash and it will take a long time for the company to get back to its pre-pandemic levels.

The fact of the matter is that at the end of the day, longer-term investors want security, i.e., high-quality stocks that are growing their sales and earnings. They don’t want to be invested in stocks with uncertain futures.

The third reason behind the broader market strength is the decline in the 10-year Treasury yield, which fell below 1.5%. As a result, money is pouring into the stock market. Keep in mind that while China has higher yields, the country has devalued its currency in the past and its economy is a mess. Japan has zero interest rates, Europe has negative interest rates, and Britain is fighting a negative interest rate trend. So, that leaves the U.S. We have higher interest rates than the rest of the world and a better economic system.

With all that said, the stock market is overbought now. Through last Friday, the S&P 500 had been up 16 times in the prior 18 trading days. According to Bespoke, it’s been 30 years since the S&P 500 has climbed so consistently. If you look back to 1952, this trading action has only occurred eight other times. Suffice it to say, this is a rare occurrence. Bespoke also found that the S&P 500’s performance isn’t quite as strong, but, overall, the S&P 500 was still up in the next year. So, the stock market is likely to stay overbought for the foreseeable future, which means further gains are still to come.

With the market expected to continue climbing higher, now is the time to invest if you haven’t already. Keep in mind that we’re in the midst of an “early January effect,” which tends to get underway in November. Many of my Accelerated Profits small- and mid-cap stocks are already benefitting from this early January effect. This isn’t too surprising as my Accelerated Profits stocks have superior forecasted sales of 35.6%, earnings growth of 289.2% and a strong earnings surprise history of 51.2%. So, I expect these fundamentally superior stocks to become go-to names for investors as we move deeper into the seasonally strong time of year.

To further take advantage of the coming strength, I will be releasing a brand-new small-cap stock in Accelerated Profits on Thursday, after the market close. It recently reported record quarterly sales and rallied nicely on the results. I see plenty of upside potential for this stock, so sign up now so you’re ready to pull the trigger after my recommendation is out on Thursday.

Sincerely,

Signed:
Louis Navellier

The Editor hereby discloses that as of the date of this email, the Editor, directly or indirectly, owns the following securities that are the subject of the commentary, analysis, opinions, advice, or recommendations in, or which are otherwise mentioned in, the essay set forth below:

Enphase Energy Inc. (ENPH), InMode Ltd. (INMD), Atlassian Corporation Plc (TEAM)

Weekly Upgrades and Downgrades

During these busy times, it pays to stay on top of the latest profit opportunities. And today’s blog post should be a great place to start. After taking a close look at the latest data on institutional buying pressure and each company’s fundamental health, I decided to revise my Portfolio Grader recommendations for 76 big blue chips. Chances are that you have at least one of these stocks in your portfolio, so you may want to give this list a skim and act accordingly.

This Week’s Ratings Changes:

Upgraded: From Hold to Buy
Symbol Company Name Quantitative
Grade
Fundamental
Grade
Total
Grade
ABEV Ambev SA Sponsored ADR B B B
AMX America Movil SAB de CV Sponsored ADR B C B
ANET Arista Networks Inc A C B
BILL Bill.com Holdings Inc. B C B
COST Costco Wholesale Corporation B C B
ESS Essex Property Trust, Inc. B C B
FDS FactSet Research Systems Inc B C B
FERG Ferguson Plc B C B
FFIV F5 Networks Inc. B C B
GIS General Mills, Inc. B C B
KHC Kraft Heinz Company B C B
KLAC KLA Corporation B B B
LSCC Lattice Semiconductor Corporation B B B
LSXMK Liberty Media Corp. Series C Liberty Sirius XM B B B
MRVL Marvell Technology Inc. B B B
MTB M&T Bank Corporation B B B
NOC Northrop Grumman Corporation B C B
NVDA NVIDIA Corporation B B B
NWS News Corporation Class B B C B
NWSA News Corporation Class A B C B
PEP PepsiCo, Inc. B C B
PLTR Palantir Technologies Inc. Class A B C B
TECK Teck Resources Limited Class B C B B
TEF Telefonica SA Sponsored ADR C B B
UAL United Airlines Holdings, Inc. B B B
UNH UnitedHealth Group Incorporated B C B
VTR Ventas, Inc. B C B
ZBRA Zebra Technologies Corporation B C B
Upgraded: From Sell to Hold
Symbol Company Name Quantitative
Grade
Fundamental
Grade
Total
Grade
ABB ABB Ltd. Sponsored ADR C C C
APH Amphenol Corporation Class A D C C
CHTR Charter Communications, Inc. Class A D C C
EMN Eastman Chemical Company D C C
HEI.A HEICO Corporation Class A D C C
HON Honeywell International Inc. D C C
MCK McKesson Corporation D C C
MTCH Match Group Inc. C D C
NVR NVR, Inc. C C C
PH Parker-Hannifin Corporation C C C
QCOM Qualcomm Inc D B C
TREX Trex Company, Inc. D C C
TTWO Take-Two Interactive Software, Inc. D C C
TXN Texas Instruments Incorporated D C C
Downgraded: From Buy to Hold
Symbol Company Name Quantitative
Grade
Fundamental
Grade
Total
Grade
BSY Bentley Systems Incorporated Class B C B C
CLF Cleveland-Cliffs Inc C B C
DHR Danaher Corporation C C C
DISH DISH Network Corporation Class A C C C
DT Dynatrace, Inc. C B C
EA Electronic Arts Inc. C C C
GNRC Generac Holdings Inc. B C C
HBAN Huntington Bancshares Incorporated C C C
ICLR ICON Plc C C C
JBHT J.B. Hunt Transport Services Inc. C C C
LBTYK Liberty Global Plc Class C C B C
LNC Lincoln National Corporation B C C
MGM MGM Resorts International C B C
ORLY O’Reilly Automotive Inc. B C C
SPGI S&P Global, Inc. C B C
TRP TC Energy Corporation B D C
UMC United Microelectronics Corp. C B C
WCN Waste Connections, Inc. B C C
WDC Western Digital Corporation B C C
Downgraded: From Hold to Sell
Symbol Company Name Quantitative
Grade
Fundamental
Grade
Total
Grade
ACM AECOM D D D
BA Boeing Company D C D
BBD Banco Bradesco S.A. Sponsored ADR D C D
FIVN Five9 Inc. D B D
LEA Lear Corporation D D D
LNT Alliant Energy Corp D C D
MKL Markel Corporation D D D
NWL Newell Brands Inc. D C D
NXPI NXP Semiconductors NV D C D
RE Everest Re Group Ltd. C D D
ROP Roper Technologies Inc. D C D
SYK Stryker Corporation D D D
T AT&T Inc. D B D
UNP Union Pacific Corporation D C D

To stay on top of my latest stock ratings, plug your holdings into Portfolio Grader, my proprietary stock screening tool. You may get started here.

Sincerely,
Louis Navellier

Louis Navellier

Are Vaccine Stocks A Buy on Earnings?

Well, it looks like the majority of the world population is now vaccinated for COVID-19. 51% of the global population are at least partially vaccinated for a total of 3.91 billion people with at least with one dose.

But the U.S., as I talked about last week, has fallen behind on a global scale. 58.4% of the U.S. is fully vaccinated and 67.3% with at least one dose, placing 17th on the world scale.

The good news is that Pfizer Inc.’s (PFE) COVID-19 vaccine has now been approved for use by the Centers for Disease Control and Prevention (CDC) for children aged five to eleven years old in the U.S., which will hopefully boost vaccination numbers.

Now that the COVID-19 vaccine is available to virtually everyone in the country, the biotech companies working on the vaccine behind the scenes are going to have some serious profit potential, as was evident in Pfizer’s and Moderna Inc.’s (MRNA) most-recent earnings results this week.

So, let’s take a quick look at their earnings results.

Pfizer (PFE): Earnings Reported on Tuesday, November 2

Pfizer is one of the world’s largest pharmaceutical companies and develops a variety of medicines and vaccines, including one for COVID-19. The mRNA vaccine from Pfizer and BioNTech SE (BNTX) is currently the most administered in the U.S. with 241 million doses.

For its third quarter, PFE reported better-than-expected adjusted earnings of $1.34 per share, which topped analysts’ expectations for adjusted earnings of $1.09 by 23.5%. Earnings are up 86% year-over-year from the $0.72 earned in the third quarter of 2020. Third-quarter revenue of $24.09 billion slightly beat estimates calling for $22.81 billion, topping previous year’s quarter by 98.62%.

The company also raised full-year 2021 sales forecasts for the vaccine by 7.5% to $36 billion. The vaccine brought in sales of $13 billion to the company for the third quarter, which topped estimates of $10.88 billion. The company is also on track to deliver 2.3 billion of the COVID-19 vaccines out of the approximate 3 billion they plan to produce this year.

It was a wild week for Pfizer shares. They initially jumped more than 5% on the strong earnings results but then took a turn on Wednesday, falling 3% after it was announced that the Merck & Co., Inc. (MRK) COVID-19 antiviral pill was approved for widespread use in the U.K. The U.S. Food and Drug Administration (FDA) has not approved the Merck oral treatment yet.

But then on Friday, the stock surged more than 10% after Pfizer announced that it also has a COVID-19 pill that decreases the likelihood of COVID-related deaths or hospitalizations by 89% in a clinical trial.

Moderna Inc. (MRNA): Reported on Thursday, November 4

As you know, Moderna has its own COVID-19 vaccine, which is second in distribution with 154 million doses. The vaccine has significantly contributed to the company’s top and bottom lines, aiding the stock’s nearly 234% increase this year, though the biotech company still reported weaker-than-expected earnings and revenue in its latest quarter.

For the third quarter, MRNA reported earnings per share of $7.70 on $4.97 billion in revenue. Analysts were expecting earnings of $9.42 on revenue of $6.29 billion, so the company missed earnings estimates by 18.3% and revenue estimates by 20.9%.

The company also announced that it aims that to deliver between 700 million and 800 million more doses, instead of the 800 million to one billion that was expected. Sales for the COVID-19 vaccine are expected to come in between $15 billion and $18 billion instead of the previous guidance for $20 billion, which pales in comparison to PFE’s expected $36 billion this year.

However, the company remains optimistic. CEO Stephane Bancel stated, “We are humbled to have helped hundreds of millions of people around the world with our COVID-19 vaccine and yet we know our work is not done.”

Unfortunately, this optimism wasn’t enough to help the stock. It fell 20% on earnings and then more than 24% on Friday following the announcement of Pfizer’s COVID pill.

My Vaccine Stock Pick

Despite their earnings, these companies are not my favorite biotech stocks. I like BioNTech SE (BNTX), which is working with Pfizer on the COVID-19 vaccine

BioNTech SE (BNTX) is my pick for the biotech industry right now for several reasons. Not only has BNTX been working with PFE on the current COVID-19 vaccine, but it seems to be a favorite of the Biden administration.

Now, the stock was down 22% this week on the Pfizer COVID-19 pill news; however, I’m not too worried. As of now, vaccinations are still ultimately more effective at preventing COVID hospitalizations and spread of the virus, with about 95% efficacy. BioNTech is also working with Pfizer to test variant-specific vaccines, which can be designed in a matter of days.

The companies are also preparing testing procedures like preclinical research, manufacturing, clinical testing, and regulatory submission to get a head start should a variant-specific vaccine be needed. In August, the companies started a trial of a multivariant vaccine targeting both the Delta and Alpha variants, though they have no plans to release it to the public.

But what sets BNTX apart from PFE and MRNA is its incredible performance and its growth potential. For example, take a look and see how these companies have performed year-to-date:

As you can see, BioNTech has soared 203% over the past year with Moderna closest behind at 131%. Pfizer has climbed just 36%, though it still beats out the S&P 500’s 31% gain during the same time period.

My Accelerated Profits subscribers have been along for the ride, as my Project Mastermind system flagged BNTX back in April 2021, when the stock was trading around $156.

I should add that BNTX is not a one-trick pony and has several other projects in the works other than the COVID-19 vaccine. The company is also working on cancer treatments. In fact, it’s currently advanced 15 oncology product candidates in 18 ongoing clinical trials. BioNTech is also working on a malaria vaccine for the African continent and anticipates starting a clinical trial by the end of 2022.

Now, BioNTech SE will lay out its cards next Tuesday, November 9, when it reports its third-quarter earnings results. Currently, analysts expect earnings of $2.27 on revenue of $5.93 billion. The stock has a solid history of earnings surprises, so a fourth-straight earnings surprise could be in the cards.

The bottom line is that BNTX has the superior fundamentals to keep trekking higher while the world combats COVID-19 and beyond.

But it’s far from the only fundamentally superior stock on my radar right now. My Project Mastermind system found another fundamentally superior stock that is well-positioned to benefit from the trucking shortage in the U.S.. I released the name and buy advice on Thursday. If you missed it, simply sign up here and I’ll give you all the details.

Sincerely,

Signed:
Louis Navellier

The Editor hereby discloses that as of the date of this email, the Editor, directly or indirectly, owns the following securities that are the subject of the commentary, analysis, opinions, advice, or recommendations in, or which are otherwise mentioned in, the essay set forth below:

BioNTech SE (BNTX)

Why These Two Tech Stocks Are Outperforming the Stock Market

We’re coming into a historically strong month for the stock market, and part of the reason has to do with the fact that Americans typically perk up this time of year as we gather with family and friends to celebrate Thanksgiving.

This feeling of “goodwill” tends to rub off on Wall Street as well, boosting the stock market, as we’ve seen in recent weeks.

The S&P 500 closed Thursday at a new record high and was up for the seventh consecutive positive day, providing an excellent start to November. The NASDAQ also closed at a new record and is up for the tenth trading day in a row.

In October, the S&P 500 soared nearly 7% and the Dow rose about 5.8%.

Consider this: With the S&P 500’s impressive performance in October, the index was up 22.6% in the first 10 months of 2021. According to our friends at Bespoke, this is only the tenth time the S&P 500 has climbed more than 20% year-to-date through October since 1928. In the previous nine instances, the S&P 500 continued to climb higher in November, posting a median gain of 3.24%.

That’s the good news. The great news: November, December and January are historically the three best months for the stock market. In fact, the Dow Jones Market Group reports that the S&P 500 and Dow both gain about 3.4% during this three-month span, while the NASDAQ tends to rally 6.3%. So, we have three months of seasonal strength in front of us!

Essentially, we’re in the midst of a renaissance era for powerful growth stocks, which are increasingly emerging as market leaders in the wake of their positive quarterly results. The smart money is now chasing fewer stocks and focusing primarily on those able to maintain accelerating earnings and sales momentum in the current environment.

The reality is that the third-quarter earnings announcement season has revealed which companies achieved spectacular results in the most recent quarter, which will be able to maintain this strong earnings momentum going forward—and which won’t. The companies backed by superior fundamentals are stealing the show, and institutional and individual investors alike are loading up prior to yearend.

We’ve seen this play out in several of our Accelerated Profits positions, as they have rallied strongly in the wake of better-than-expected results.

That’s the beauty of my Project Mastermind system in a nutshell. It’s essentially a cutting-edge artificial intelligence (AI) stock research system that relies on mathematics and computers to pinpoint stocks that are poised to go explosive runs.

Let me show you a couple of recent examples that illustrate my point.

Take Atlassian Corporation Plc (TEAM).

The company, whose name was inspired by the Greek Titan, is a global software company focused on providing tools and resources that promote teamwork and collaboration. The company’s business really took off in 2002 when it introduced Jira 1.0.

A few of its products include Jira Software, a software development tool used to prioritize and assign tasks; Atlassian Access, an identity and security tool for Atlassian cloud infrastructure; Statuspage, a tool to track incidents and the process to rectify any issues; Confluence and Trello, software that allows teams to create and share projects in one space; and Bitbucket, Bamboo, Crucible, Fisheye and Sourcetree, products used to build software and improve coding.

Overall, Atlassian’s products are utilized by 83% of Fortune 500 companies, and it has 180,000 customers in more than 190 countries around the world. The company also boasts 10 million monthly active users for its Atlassian cloud products. So, it’s not too surprising that Atlassian’s business is thriving.

Indeed, shares of this fundamentally superior company jumped recently after it reported a better-than-expected earnings announcement on October 28.

For its first quarter in fiscal year 2022, TEAM achieved earnings of $118.3 million, or $0.46 per share, up from $76.8 million, or $0.30 per share, in the same quarter a year ago. First-quarter revenue rose 34% year-over-year to $614 million. The analyst community was expecting earnings of $0.40 per share on $582.32 million in revenue.

TEAM also noted that it ended the first quarter with 216,500 customers, after adding 11,746 new customers during the quarter.

Looking ahead to the second quarter in fiscal year 2022, TEAM expects total revenue between $630 million and $645 million and earnings per share between $0.35 and $0.38. That compares to earnings of $0.37 in the second quarter of 2021.

My Project Mastermind system flagged the stock and I recommended it to my Accelerated Profits subscribers back on September 28.

Following the company’s outstanding earnings announcements, the stock is up almost 8% in the Accelerated Profits portfolio. Compare that to the 3% gain for the NASDAQ and the 2% gain for the S&P 500 over the same timeframe.

Another example: InMode Ltd. (INMD).

More than 20 years ago, the company was founded by a group of doctors and scientists who developed light, laser and radiofrequency devices for several minimally invasive procedures, including body and face contouring, hair removal, liposuction, skin tightening, facial skin rejuvenation, wrinkle reduction, muscle stimulation and fat reduction.

On October 26, InMode reported record third-quarter results.

The Israeli company’s third-quarter revenue soared 58% year-over-year to $94.2 million, with surgical technology platforms accounting for 73% of quarterly revenue. Analysts were expecting third-quarter revenue of $89.26 million.

Third-quarter earnings surged 77.4% year-over-year to $0.55 per share, up from $0.31 per share in the same quarter a year ago. Analysts were looking for earnings of $0.50 per share, so InMode posted a 10% earnings surprise.

Looking forward, InMode expects full-year revenue between $343 million and $347 million and earnings per share between $1.91 and $1.93. That’s up from earnings of $1.05 per share and revenue of $206.11 million in fiscal year 2021. This forecast is also nicely higher than analysts’ current expectations for full-year earnings of $1.86 per share and revenue of $341.03 million.

The company’s stock has soared nearly 10% since reporting its third-quarter results, handily topping the 5% gain for the NADAQ and the 2% gain for the S&P 500.

Project Mastermind spotted INMD and I recommended it to my Accelerated Profits subscribers back on April 27. Since then, the stock has soared over 113%, compared to the NASDAQ’s 14% gain and the S&P 500’s 13% climb over the same timeframe.

Of course, with expected revenue and earnings gains going forward, I’m anticipating these stocks will continue to trek higher.

As you can see above, they also both earn an “A” for the Total Grade in my Portfolio Grader, as well as an “A” for their Quantitative Grades, which represents institutional buying pressure under the stocks.

The bottom line: Investors are now putting fundamentals front and center, and my Accelerated Profits stocks are perfectly positioned to benefit from this shift.

Sincerely,

Signed:
Louis Navellier

P.S. Of course, Atlassian and InMode aren’t the only stocks I like right now.

In fact, my Project Mastermind system recently spotted another fundamentally superior stock that’s been firing on all cylinders.

Its latest earnings announcements were a stunner. The company reported double-digit earnings and sales growth from the year prior and beat Wall Street’s expectations for the top- and bottom-line.

The stock has risen by triple digits this year and I expect its superior fundamentals will help keep shares trekking higher.

Click here for full details now.

The Editor hereby discloses that as of the date of this email, the Editor, directly or indirectly, owns the following securities that are the subject of the commentary, analysis, opinions, advice, or recommendations in, or which are otherwise mentioned in, the essay set forth below:

Atlassian Corporation Plc (TEAM), InMode Ltd. (INMD)

What the Latest Fed Pronouncements Mean for the Stock Market

In the face of rising inflation and a resurging economy, the Federal Open Market Committee (FOMC) on Wednesday said that the Federal Reserve will start this month to reduce, or “taper,” its recent stimulus program of bond-buying, with a plan to end the program fully by June.

The FOMC also said in its dovish statement that it would keep its target range for interest rates at 0.0% to 0.25% for the foreseeable future until the committee determines maximum employment following layoffs related to the pandemic returns and inflation is on track to “moderately exceed 2% for some time.”

The committee decided to start reducing its monthly pace of its net asset purchases by $10 billion for Treasury securities and $5 billion for agency mortgage-backed securities, which is much less than what many economists were expecting.

That means, beginning later this month, the Fed will buy at least $70 billion per month of Treasury securities and at least $35 billion per month of mortgage-backed securities. Then starting in December, the Fed will buy at least $60 billion per month of Treasury securities and at least $30 billion per month of mortgage-backed securities.

The Fed will likely continue to reduce its purchases at a similar pace through June but may change its schedule depending on the economic outlook.

Fed officials also admitted that inflation has been on the rise, though the committee still considers increasing prices as mostly a transitory phenomenon that doesn’t yet warrant raising rates.

“Supply and demand imbalances related to the pandemic and the reopening of the economy have contributed to sizable price increases in some sectors,” the Fed said in its statement.

However, Federal Reserve Chairman Jerome Powell noted in a press conference after the meeting that: “Our decision today to begin tapering our asset purchases does not imply any direct signal regarding our interest rate policy. We continue to articulate a different and more stringent test for the economic conditions that would need to be met before raising the federal funds rate.”

Stocks climbed on the news, with the Dow rising to a new record close over 36,000 and both the S&P 500 and the NASDAQ hitting new record highs at Wednesday’s close as well.

I should add that the Fed is not alone in staying the course on keeping interest rates steady, as the Bank of England made the same decision this morning. The bank will keep its rates at 0.1%, even as it expects inflation will increase to about 5% by the spring of 2022.

Overall, it is very apparent to me that Fed Chairman Powell wants his job renewed by President Biden and will strive to not rock the boat by keeping monetary policy super accommodative.

Benefitting from an Early “January Effect”

So, what do the latest Fed pronouncements mean for the stock market?

I’d say nothing bad for fundamentally superior smaller-cap growth stocks.

Under the surface of the market, we’re in the midst of a very strong “January effect.” We experienced a bit of it in October and now it’s accelerating. That’s when yearend pension funding and annual gift-giving tend to create forced buying pressure under smaller-cap stocks, which are more sensitive to volume. As a result, they tend to flourish between November and May.

You can see this playing out in the Russell 2000, which hit a new 52-week high on Monday, Tuesday and Wednesday and is up more than 7% over the past month.

And even though some mega-cap stocks like Apple Inc. (AAPL) and Amazon.com Inc. (AMZN) recently missed analysts’ earnings forecasts, as I wrote about last week, they’ve rebounded fairly well in recent days.

More importantly, money isn’t leaving the market. Instead, it’s flowing into fundamentally superior smaller-cap stocks, which is a very good sign.

Normally this is a time of year when we typically lose breadth and power, but I like the tone of the market.

Now, I wouldn’t be surprised if recent highs reached in the NASDAQ and S&P 500 take a pause next week, but that’s good as well. Pauses refresh the market.

In the meantime, the private sector is adding jobs at a blistering clip. ADP reported 571,000 new jobs were added in October, crushing the Dow Jones estimate for 395,000 new jobs. The Federal Reserve Bank of Atlanta is forecasting GDP growth of 8.2% in November after decelerating at an estimated rate of 2.7% in October.

The bottom line is that with a strong economy and a recovering jobs environment there’s not much to derail the stock market as we head into the seasonally strong time of year and continue through January.

And we can’t forget about the stunning third-quarter earnings season we’re experiencing right now. According to FactSet, the average earnings surprise in the S&P 500 so far is 10.3%, and the S&P 500 is on track to achieve 36.6% average earnings growth and 15.8% average sales growth.

I am pleased to say that my Accelerated Profits stocks are forecast to do significantly better than the S&P 500. They have superior forecasted sales of 37.8% and earnings growth of 294.9%, as well as a strong earnings surprise history of 71.4%.

And since my Accelerated Profits stocks have much stronger average sales and earnings growth than the overall stock market, I expect them to continue to emerge as market leaders.

In fact, my Project Mastermind system recently spotted another fundamentally superior stock that’s been firing on all cylinders.

Its latest earnings announcements were a stunner. The company reported double-digit earnings and sales growth from the year prior and beat Wall Street’s expectations for the top and bottom lines.

The stock has risen by triple digits this year and I expect its superior fundamentals will help keep shares trekking higher. I just released the name and ticker of this stock to my Accelerated Profits subscribers this afternoon, so you’re just in time to take advantage of my latest recommendation.

Click here for full details now.

Sincerely,

Signed:
Louis Navellier

The Editor hereby discloses that as of the date of this email, the Editor, directly or indirectly, owns the following securities that are the subject of the commentary, analysis, opinions, advice, or recommendations in, or which are otherwise mentioned in, the essay set forth below:

Amazon.com Inc. (AMZN)

Did Earnings Work for Enphase Energy?

In my more than 40 years of investing, I have found that earnings work 70% of the time. In other words, companies that post strong positive results tend to see their stock propelled higher, while those that don’t see their stock slip on the news.

Well, we’re now about halfway through the third-quarter earnings season, and it’s clear that earnings are still working. According to FactSet, 56% of S&P 500 have released their most-recent earnings results. Of that 56%, 82% have posted an earnings beat and 75% have posted a revenue surprise. The average earnings surprise is 10.3%, and the S&P 500 is on track to achieve 36.6% average earnings growth and 15.8% average sales growth.

And on average, between the two days prior to earnings and two days after, companies that release better-than-expected earnings results have seen their stock rise 0.9%. During the same time frame, companies that post weaker-than-expected results have seen their stock fall an average 3.1%.

I am pleased to say that my Accelerated Profits stocks are forecast to do significantly better than the S&P 500. They have superior forecasted sales of 37.8% and earnings growth of 294.9%, as well as a strong earnings surprise history of 71.4%. A flight to quality remains underway led by companies with strong sales and earnings. And since my Accelerated Profits stocks have much stronger average sales and earnings growth than the overall stock market, I expect them to continue to emerge as market leaders.

Case in point: Enphase Energy, Inc.

Enphase Energy is a solar company that developed and introduced the first microinverter system. Simply put, microinverters sit underneath solar panels and convert all the sunshine to actual electricity for homes and businesses. So, they’re vital to the solar energy industry.

The company released its third-quarter earnings results last Tuesday – and they did not disappoint. Third-quarter revenue jumped 97% year-over-year to $351.52 million, up from $178.5 million in the same quarter a year ago. Earnings soared 100% year-over-year to $0.60 per share, compared to $0.30 per share in the third quarter of 2020. The consensus estimate called for earnings of $0.48 per share on $343.09 million in revenue, so Enphase Energy topped earnings estimates by 25% and sales forecasts by 2.4%.

Company management noted “strong demand” for its microinverter systems in the third quarter, as deliveries increase 51% quarter-over-quarter. It delivered 2.56 million microinverters, which represented 913 megawatts DC.

Looking ahead to the fourth quarter, Enphase Energy expects revenue to be between $390 million and $410 million. Fourth-quarter microinverter shipments are anticipated to total between 90 and 100 megawatt hours.

Now, as I mentioned, earnings are working for stocks that beat analysts’ expectations. So how exactly did they work out for Enphase Energy?

Well, its shares surged 29% following the company’s record third-quarter earnings announcement as investors cheered the results. The reality is beating analysts’ estimates on the top and bottom lines is par for the course for Enphase Energy. The company has topped earnings and sales expectations every quarter since my Project Mastermind system first flagged it back in March 2020.

It’s also the number-one holding in the iShares Global Clean Energy ETF (ICLN), which tracks stocks in the clean energy sector, and it’s significantly outperformed the ETF, too. It’s up more than 36% year-to-date, while ICLN is down about 8% over the same timeframe.

I look for ENPH to continue trekking higher, as it should benefit from Congress’ $1.75 trillion infrastructure bill. Currently, the infrastructure bill would provide $73 billion in funding for clean energy.

Now, Enphase isn’t the only stock I like right now; there are plenty stocks outside of the solar energy sector that I like right now. In fact, I released a brand-new recommendation based on my Project Mastermind’s findings last Thursday that’s about as far away from solar energy that you can get. This company saw 89% year-over-year sales growth and 262% earnings growth in its second quarter. It also posted a triple-digit earnings surprise.

This company is set to reveal its third-quarter earnings results after the close today, and I’m looking for another stunning earnings report. Earnings are expected to surge 400% year-over-year and revenue is expected to soar more than 100% year-over-year. Analysts have revised earnings estimates higher in the past 90 days, so an earnings surprise is likely. I expect a strong earnings report to dropkick and drive the stock higher, so if you haven’t invested yet, now is the time to do so.

I should add that there’s another fundamentally superior stock that my Project Mastermind system has found. I will be releasing the name and buy limit price on Thursday, after the market close, so if you missed out on my first recommendation, it’s not too late to miss out on my second.

Click here for full details now.

Sincerely,

Signed:
Louis Navellier

The Editor hereby discloses that as of the date of this email, the Editor, directly or indirectly, owns the following securities that are the subject of the commentary, analysis, opinions, advice, or recommendations in, or which are otherwise mentioned in, the essay set forth below:

Enphase Energy, Inc (ENPH)

Weekly Upgrades and Downgrades

During these busy times, it pays to stay on top of the latest profit opportunities. And today’s blog post should be a great place to start. After taking a close look at the latest data on institutional buying pressure and each company’s fundamental health, I decided to revise my Portfolio Grader recommendations for 153 big blue chips. Chances are that you have at least one of these stocks in your portfolio, so you may want to give this list a skim and act accordingly.

This Week’s Ratings Changes:

Upgraded: From Hold to Buy
Symbol Company Name Quantitative
Grade
Fundamental
Grade
Total
Grade
ABT Abbott Laboratories B B B
ACN Accenture Plc Class A B C B
AMH American Homes 4 Rent Class A B B B
ANTM Anthem, Inc. B B B
BEN Franklin Resources, Inc. B B B
BIP Brookefield Infrastructure Partners L.P. B B B
CME CME Group Inc. Class A A D B
DDOG Datadog Inc Class A B C B
DIS Walt Disney Company B B B
DT Dynatrace, Inc. B B B
DXCM DexCom, Inc. B C B
EA Electronic Arts Inc. B C B
EW Edwards Lifesciences Corporation B C B
EXPD Expeditors International of Washington, Inc. B B B
FE First Energy Corp. A D B
GSK GlaxoSmithKline plc Sponsored ADR B C B
HST Host Hotels & Resorts Inc. B B B
ICE Intercontinental Exchange, Inc. B B B
ICLR ICON Plc B C B
ISRG Intuitive Surgical Inc. B C B
IX ORIX Corporation Sponsored ADR B C B
KDP Keurig Dr Pepper Inc B C B
MANH Manhattan Associates Inc. B B B
MRK Merck & Co., Inc. B C B
NOK Nokia Oyj Sponsored ADR A B B
OMC Omnicom Group Inc B C B
PEAK Healthpeak Properties Inc. B B B
PFG Principal Financial Group Inc. B C B
RH Restoration Hardware B B B
SPGI S&P Global Inc. B C B
TU TELUS Corporation B C B
TW Tradeweb Markets, Inc. Class A B C B
WDC Western Digital Corporation B C B
WM Waste Managment Inc. B C B
WPC W.P. Carey Inc. B C B
Upgraded: From Sell to Hold
Symbol Company Name Quantitative
Grade
Fundamental
Grade
Total
Grade
ABEV Ambev SA Sponsored ADR C B C
ADBE Adobe Inc. C C C
AEE Ameren Corporation C D C
ALGN Align Technology Inc. D B C
AME AMETEK Inc. D C C
AZPN Aspen Technology Inc. C C C
BA Boeing Company D C C
BBD Banco Bradescor S.A. Sponsored ADR D C C
BKNG Booking Holdings Inc. C C C
EIX Edison International C C C
FTS Fortis Inc. C D C
HAS Hasbro Inc. C C C
IHG InterContinental Hotels Group PLC Sponsored D C C
INTC Intel Corporation D B C
K Kellogg Company C C C
LEA Lear Corporation D C C
MCD McDonald’s Corporation C C C
MDLZ Monselez International Inc, Class A C C C
MDT Medtronic Plc D C C
MMM 3M Company C C C
PPL PPL Corporation C F C
REGN Regeneron Pharmaceuticals Inc. D B C
ROP Roper Technologies Inc. C D C
ROST Ross Stores, Inc. D A C
RYAAY Ryanair Holdings Plc. Sponsored ADR C C C
SAP SAP SE Sponsored ADR C C C
SEDG SolarEdge Technologies C C C
SYY Sysco Corporation D B C
T AT&T Inc. D C C
TDY Teledyne Technologies Incorporated C C C
TJX TJX Companies Inc. D B C
VIV Telefonica Brasil SA Sponsored ADR C C C
VRSN VeriSign Inc. C D C
WOLF Woldspeed Inc. C D C
Downgraded: From Buy to Hold
Symbol Company Name Quantitative
Grade
Fundamental
Grade
Total
Grade
A Agilent Technologies Inc. C C C
ANET Arista Networks Inc. C C C
AVY Avery Dennison Corporation C B C
BILI Bilibili Inc Sponsored ADR Class Z C C C
BILL Bill.com Holdings Inc. B C C
BKR Baker Hughes Company Class A B D C
CARR Carrier Global Corp C B C
CB Chubb Limited C C C
CE Celanese Corporation C B C
CHT Chunghwa Telecom Co. C C C
COST Costco Wholesale Corporation B C C
DFS Discover Financial Services C C C
EQH Equitable Holdings Inc. B C C
ESS Essex Property Trust, Inc. B C C
FFIV F5 Networks Inc. C C C
FNF Fidelity National Financial C B C
GM General Motors Company C B C
IDXX IDEXX Laboratories Inc. C C C
INFY Infosys Limited Sponsored ADR C C C
JHX James Hardie Industries PLC Sponsored ADR C B C
LI Li Auto Inc. Sponsored ADR Class A C C C
LSXMB Liberty Media Corp. Series B. Liberty Sirius XM C C C
MHK Mohawk Industries Inc. C C C
MLM Martin Marietta Materials, Inc. B D C
MORN Morningstar Inc. B C C
MPWR Monolithic Power Systems Inc. C C C
MSCI MSCI Inc. Class A C D C
NLY Annaly Capital Management Inc. B D C
NOC Northrop Grumman Corporation C C C
NWS News Corporation Class B C C C
NWSA News Corporation Class A C C C
PCTY Paylocity Holding Corp. C B C
PEN Penumbra Inc. C B C
PKI PerkinElmer Inc. C C C
PLTR Palantir Technologies Inc. C C C
RMD ResMed Inc. C C C
SHW Sherwin-Williams Company C D C
TECK Teck Resources Limited Class B C C C
TFC Truist Financial Corporation B C C
TM Toyota Motor Corp Sponsored ADR C B C
TPR Tapestry Inc. C B C
TRMB Trimble Inc. C B C
TT Trane Technologies D C C
WLK Westlake Chemical Corporation C B C

 

Downgraded: From Hold to Sell
Symbol Company Name Quantitative
Grade
Fundamental
Grade
Total
Grade
ABB ABB Ltd. Sponsored ADR D C D
ALLE Allegion Plc D C D
APH Amphenol Corporation Class A D C D
AWK American Water Works Company D C D
BBL BHP Group Plc Sponsored ADR D C D
BIDU Baidu Inc Sponsored ADR Class A D D D
CDAY Ceridian HCM Holding Inc. D C D
CHTR Charter Communications Inc. Class A D C D
CMI Cummins Inc. D C D
CSGP CoStar Group Inc F C D
DOCU DocuSign Inc. D C D
DOW Dow Inc. D B D
GRMN Garmin Ltd. D C D
HDB HDFC Bank Limited D C D
HOLX Hologic Inc. D B D
KB KB Financial Group Inc. D C D
LBRDA Liberty Broadband Corp. Class A D C D
LBRDK Liberty Broadband Corp. Class C D D D
MCK McKesson Corporation D B D
MTCH Match Group, Inc. D C D
NIO NIO Inc. F C D
NTES NetEase Inc. D C D
NVR NVR, Inc. D C D
OKTA Okta Inc. Class A D B D
PINS Pinterest Inc. Class A F B D
PTC PTC Inc. D C D
ROKU Roku Inc. Class A D B D
SCCO Southern Copper Corporation F B D
SHG Shinhan Financial Group Co. D C D
SNPS Synopsys Inc. D C D
SONY Sony Group Corporation D D D
SQ Square Inc. Class A D B D
TDG TransDigm Group Incorporated D C D
TWTR Twitter Inc. C D D
TXN Texas Instruments Incorporated D C D
VALE Vale S.A. Sponsored ADR D B D
WY Weyerhaeuser Company D B D

To stay on top of my latest stock ratings, plug your holdings into Portfolio Grader, my proprietary stock screening tool. You may get started here.
To stay on top of my latest stock ratings, plug your holdings into Portfolio Grader, my proprietary stock screening tool. You may get started here.

Sincerely,
Louis Navellier

Louis Navellier

The Tesla Partner That’s Making Headlines

Well, electric vehicles (EV) are making headlines once again and no one is surprised to see Tesla’s (TSLA) name being thrown around.

Tesla was all over the news for several reasons. One being the company breeched the $1,000 per share mark this week and hit a new high of $1,100 per share. The company also hit an impressive market cap milestone recently, at $1.08 trillion.

Even more impressive, one of my Project Mastermind stocks has been all over the news in relation to their new, state of the art battery for Tesla. And the company may surprise you!

Panasonic Corporation (PCRFY) just unveiled a new prototype lithium iron phosphate (LFP) battery. The PCRFY battery is five times the size of those currently used by Tesla. However, these new batteries only cost half as much to make and last five times longer than the previous batteries used by Tesla.

And that’s not all. The new battery is projected to boost production at Panasonic 100-fold by the end of the decade. Pretty impressive if you ask me!

My Accelerated Profits subscribers are already well-versed in Panasonic, as I recommended the stock to them back in August, after my Project Mastermind system flagged the name. I should add that when I recommended the stock, the news of their business partnership was just speculation with no prototype battery to show for it.

Now with the prototype set, Panasonic is seeing the fruits of their labor roll in. This week, the stock was up 8% and the company raised their profit outlook by 12% thanks to a share valuation gain.

Longer term, Panasonic is also developing a solid-state battery with Toyota—and it could revolutionize the EV industry. So, as EVs grow in popularity, Panasonic is poised to prosper as a major Tesla supplier, as well as a one of the winners in the race to make solid-state batteries.

What’s great is that battery demand is already adding to Panasonic’s top and bottom lines. During its first quarter in fiscal year 2022, earnings surged to 104.4 billion yen, compared to 3.8 billion yen in the same quarter a year ago. That exceeded expectations by 50% and represented the company’s strongest profit in a first quarter in more than a decade. Panasonic’s Automotive division achieved earnings of 9.8 billion yen, which was up from a loss in the same quarter last year. Panasonic also expects to report full-year 2022 earnings of 330 billion yen.

To get my latest buy advice on Panasonic, click here to subscribe to my Accelerated Profits service. You will get immediate access to the portfolio, including my brand-new recommendation found with my Project Mastermind system, released yesterday. This is a fundamentally superior stock that’s been firing on all cylinders, and I don’t expect it to tap the brakes anytime soon.

The company’s third-quarter earnings report is scheduled for next Wednesday. And currently, analysts are calling for triple-digit year-over-year earnings growth and double-digit year-over-year revenue growth. Over the past 90 days, analysts have revised their earnings estimates 82%. Positive analyst revisions typically precede positive earnings surprises, so an earnings beat could be in the offing.

If you want to get in now before the company’s earnings report next week, now is the time to do so. Click here for full details.

Sincerely,

Signed:
Louis Navellier

The Editor hereby discloses that as of the date of this email, the Editor, directly or indirectly, owns the following securities that are the subject of the commentary, analysis, opinions, advice, or recommendations in, or which are otherwise mentioned in, the essay set forth below:

Panasonic Corporation (PCRFY)

Reviewing the FAANG’s Earnings Announcements

A crop of outstanding earnings reports this quarter for fundamentally superior companies helped send the S&P 500 to its 57th and 58th all-time highs on Tuesday and Thursday, respectively, and rose 1.2% for the week.

The Dow also reached a new all-time high on Tuesday and is up 0.3% for the week, while the NASDAQ reached a new record high on Thursday and climbed just under 2.5% this week.

But the markets woke up on the wrong side of the bed Friday morning after digesting disappointing earnings announcements from Apple Inc. (AAPL) and Amazon.com Inc. (AMZN).

The companies’ reports represented the last of the quarterly earnings announcements of the FAANG stocks, which also include Facebook Inc. (FB), Netflix Inc. (NFLX) and Google parent company, Alphabet Inc. (GOOG).

There’s lots of news to digest from these earnings reports, including Facebook’s branding reboot, so let’s use today’s Market360 to dig in.

Facebook (FB) – Announced October 25.

Facebook’s third-quarter revenue rose 35% year-over-year to $29.01 billion but was lower than Wall Street consensus estimates for revenue of $29.52 billion. Earnings climbed 19% year-over-year to $3.22 per share. Analysts were calling for earnings of $3.18 per share, so the company topped expectations by 1.3%.

Chief Financial Officer David Wehner noted that the company faces continued headwinds in the fourth quarter from privacy changes to Apple’s iOS 14 that gives users more control over privacy and has already put a dent in Facebook’s advertising revenue, which is a huge part of the company’s revenue.

Monthly active users rose 6% to 2.91 billion, which was just shy of analysts’ expectations for 2.92 billion. Non-advertising revenue almost tripled year-over-year to $734 million.

The company also noted plans to separate out its virtual reality business into a separate revenue segment next quarter it’s calling Facebook Reality Labs. Meanwhile, the company is investing big on the segment and expects it to reduce overall operating profit this year by about $10 billion.

CEO Mark Zuckerberg has said he’s interested in the company becoming a leader in the metaverse — a set of virtual reality spaces where you can create and explore with others who aren’t in the same physical space. To that end, the company has even decided to change its name to “Meta” to fall more in line with its goals for the metaverse.

“Today we are seen as a social media company, but in our DNA we are a company that builds technology to connect people, and the metaverse is the next frontier just like social networking was when we got started,” CEO Mark Zuckerberg said.

Facebook’s stock ticker will change to MVRS on December 1, which means the FAANG moniker may need an adjustment. MAANG anyone?

Facebook stock ticked up Thursday in advance of the new name change but is now down 4% since reporting earnings. The company also continues to face an onslaught of media reports about internal Facebook documents that reveal internal research identifying harmful effects from its products. The Wall Street Journal said on Wednesday that the Federal Trade Commission has begun looking into the company’s internal documents.

Amazon (AMZN) – Announced October 28

Amazon shares took a beating in extended hours trading Thursday after the company reported it missed on both top- and bottom-line estimates from Wall Street for its third quarter.

Revenue of $110.8 billion climbed 15% from last year, but missed analysts’ estimates for $111.6 billion. Earnings of $6.12 per share decreased from $12.37 per share a year ago and badly missed Wall Street’s expectations for $8.92 per share. That means Amazon missed analysts’ expectations by 46%.

Online store sales increased 3% from a year prior to $49.9 billion and physical store sales grew 13% from a year ago to $4.3 billion. Third-party seller revenue jumped 18% to $24.3 billion.

The company’s services segment, which brought in $55.9 billion overall, saw sales beat its retails sales segment for the first time in Amazon’s history. Amazon Web Services revenue came in at $16.1 billion, up 39% from a year ago and topping analysts’ forecast for $15.5 billion.

Shares started climbing modestly Monday ahead of the company’s earnings announcements but are up just under 6% on the year.

Alphabet (GOOGL) – Announced October 26

Google reported earnings of $27.99 per share, up 70.6% from a year ago and topping analysts’ estimates by $4.74 per share, or a 20% earnings surprise.

Revenue of $65.1 billion rose 41% from a year ago and beat Wall Street’s estimates for the quarter by $1.8 billion.

Google’s advertising revenue increased 43% year-over-year to $53.1 billion, while YouTube ad sales climbed 43% from a year ago to $7.2 billion. The company has been more insulated from the changes to Apple’s operating system than Facebook as it owns the Android operating system.

The company’s cloud division sales jumped 45% from a year ago to just under $5 billion as Alphabet continues to place significant investments in the segment.

Shares popped over 6% after reporting earnings and are up over 66% so far this year.

Apple (AAPL) – Announced October 28

Apple announced its fourth-quarter earnings of $1.24 per share, which was up 70% from a year prior and in line with Wall Street’s consensus expectations.

Sales of $83.4 billion were up 29% from a year ago but missed analysts’ expectations by $1.62 billion. That means Apple had a revenue miss of 1.9%. The disappointing report marked the first time the company hasn’t beaten earnings estimates since April 2016 and the first time it hasn’t topped revenue estimates since May 2017.

CEO Tim Cook blamed supply chain constraints including semiconductor shortages and COVID-related manufacturing disruptions in Asia on lagging iPhones, iPads and Mac sales, which cost the company about $6 billion.

iPhone sales climbed 47% year-over-year, but still missed Wall Streets estimates, while iPads revenue increased 21% from a year ago, despite supply side constraints.

The company hasn’t provided forward guidance since the pandemic began, but Cook said he expects to see solid year-over-year revenue growth in the coming quarter even though the company expects supply constraints to worsen.

The company’s services business, which includes music and video subscriptions and sales from the App Store, shined for the quarter and was up 26% on the year and higher than Apple expected. Apple now has 745 million paid subscriptions, up 160 million year-over-year, and up five times in five years.

Shares have climbed about 7% from a low on October 13 and are 12% higher so far this year.

Netflix (NFLX) – Announced October 19

Streaming video leader Netflix announced earnings of $3.19 per share, up over 83% from a year ago and beating Wall Street’s consensus estimate for $2.56 per share by 24.6%.

Sales of $7.5 billion increased 16% from a year ago and just topped analysts’ estimates by $0.16 million.

The company added 4.4 million new paid subscribers, beating analysts’ calls for 3.84 million. Netflix said it now anticipates adding 8.5 million subscribers in the fourth quarter.

“We have so much content coming in Q4 like we’ve never had, so we’ll have to feel our way through and it rolls into a great next year also,” said co-CEO Reed Hastings.

Netflix also said it will begin using new metrics to report viewership, switching to hours viewed from the number of accounts that watched, which in part gives proper credit to re-watching content.

The company’s new hit show, “Squid Game,” has been its biggest ever, as 141-million-member households around the world watched the show in its first month after debuting.

Interestingly, Netflix said its viewership ballooned 14% earlier in the month when Facebook had a global outage.

Shares have increased over 6% since the company reported strong earnings and are up over 25%, year to date.

How to Play Like a Mastermind

The past week has been good to shares of the FAANGS overall, except Facebook. However, if you took the FAANGs as one portfolio right now, here’s how that would look in my Portfolio Grader.
As you can see, it’s a mixed bag.

The overall FAANG portfolio earns a Total Grade of “C,” with Google and Netflix earning a strong “B” for their Total Grade and a “B” for their Quantitative Grade, which represents institutional buy pressure under the stocks. Amazon and Facebook, on the other hand, earn a “D” for their Total Grade, meaning they’re an immediate sell, while Apple earns a “C” for its Total Grade, making it a solid Hold.

In fact, the stocks that earned poor grades in my Portfolio Grader sold off after reporting results.

So while a couple of the FAANGs are attractive buys right now, the remainder are not the fundamentally superior stocks my Project Mastermind system is tuned to find. Overall, I’d look for better opportunities in small-cap, high-growth stocks elsewhere.

In fact, my Project Mastermind system just spotted another fundamentally superior stock yesterday that’s been firing on all cylinders. In its latest earnings announcements was a stunner. The company reported triple-digit sales growth from the year prior and a triple-digit earnings surprise.

The company is slated to report its third-quarter announcements on Wednesday, and investors have been piling into the stock in anticipation.

Analysts are calling for triple-digit earnings growth from a year ago and double-digit sales growth. Over the past 90 days, analysts have revised their earnings estimates 82% higher. Positive analyst revisions typically precede future earnings surprises.

Sign up here to get all the details.

Sincerely,

Signed:
Louis Navellier

The Editor hereby discloses that as of the date of this email, the Editor, directly or indirectly, owns the following securities that are the subject of the commentary, analysis, opinions, advice, or recommendations in, or which are otherwise mentioned in, the essay set forth below:

Amazon.com Inc. (AMZN), Facebook Inc. (FB), Alphabet Inc. (GOOG)

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