![]() And here are the top stocks that have caught my attention. To help identify more of these massive winners, I’ve taken the Loaded Rifle to Louis’ stock portfolio. So how can a Moonshot investor know which of these companies have 100x potential versus those with just 2x? Yet Louis’s portfolio is a mix of conservative companies and aggressive ones. ![]() Both stocks have risen over 800% since 2019 (Louis’s also no slouch when it comes to risk management, with his worst-performer down just -21%). Louis and his team have picked stunning winners like Digital Turbine (NASDAQ: APPS) and Enphase Energy (NASDAQ: ENPH) early on by focusing on fast-growing companies. Today, I will introduce another momentum tool to the arsenal: Louis Navellier’s Breakthrough Stocks. It’s a powerful tool in weeding out value traps like Sears Holdings (OTCMKTS: SHLDQ). Long-time Moonshot readers will be familiar with my Momentum Master strategy, which favors fast-growing stocks over slower-moving ones in breakout type markets. So how can investors reduce the duds and focus on the winners? For instance, removing the ten worst-performing stocks from the 51 <0.1x P/S stocks of 2021 would have boosted average returns by 24%. Investors can do even better by avoiding stocks that fizzle out. Ditching the Duds For Even Better Returns And when compared to the highest 50 P/S stocks? Cheap stocks outperformed the expensive ones by 65 times. When stocks border on zero, they tend to either 1) disappear entirely or 2) rocket back for massive returns.Īnd good news for investors? Even with the duds, buying low-cost stocks wins in the long run.Īccording to a study by hedge fund manager James O’Shaughnessy, $10,000 invested in the 50 lowest price-to-sales stocks in 1951 would have outperformed the S&P 500 by 4x by 2003. The same principle holds for lowly valued stocks. In other words, if you set up expectations as a novelist, those expectations should be fulfilled. “If in the first act you have hung a loaded rifle on the wall, then in the following one, it should be fired. The best storytellers often follow a rule coined by Russian novelist Anton Chekhov: Source: Catalyst Labs / Shutterstock Chekhov’s Loaded Rifle? Meet Moonshot Bets Today, we’ll look into a strategy I call the Loaded Rifle - a tactic that one hedge fund manager called “the King of the Value Factors” - and apply it to one of InvestorPlace’s top-performing portfolios, Louis Navellier’s Breakthrough Stocks. But remember, even Tesla’s stock traded at less than 2x P/S before embarking on its 10x run in 2020. I know it’s tempting to try finding the next Amazon (NASDAQ: AMZN) or Tesla (NASDAQ: TSLA) by snapping up the hottest stocks on StockTwits or recommended by your shoeshiner (if that profession still exists). The only way to make 100x returns is buying assets that can potentially rise 100x. It’s that cheapness that allowed Reddit users to make millions pumping up shares. In other words, their market capitalizations looked like a rounding error compared to the size of their businesses. GameStop sank further - the mall-based retailer’s valuation dropped to 0.02 times P/S. The Covid-19 pandemic sent shares of AMC Entertainment plummeting under $3, valuing the theater chain at under 0.05 times price-to-sales (P/S). What did AMC (NYSE: AMC) and GameStop’s (NYSE: GME) stock have in common?
0 Comments
Leave a Reply. |
AuthorWrite something about yourself. No need to be fancy, just an overview. ArchivesCategories |