Yellen is Right - Sell Biotech Stocks Now

Despite their high times of late, I agree with Janet Yellen’s Fed and see risk in the extended biotech sector today. Biotechnology stocks have outperformed the broader market this year, as the high risk, high-beta issues have remained en vogue. However, for two very important reasons, I would sell biotechnology today. So I’m suggesting holders of the popular iShares NASDAQ Biotechnology (Nasdaq: IBB) security divest positions. For those believers in specific biotech ideas, like say Gilead (Nasdaq: GILD) for instance, who want to hold on for the longer term, I suggest hedging industry risk by writing calls or holding puts in the IBB security if enough liquidity exists in the options market. Otherwise, you might use unlevered short industry ETFs if possible, or pare trade your name against another. See the full report here: I Agree with Yellen, Sell Biotech Right Now.

Tesla is Going to Power Down Now

Tesla (Nasdaq: TSLA) shares are up approximately 66% year-to-date, but more recent price action shows some question in the stock. The reason for that may have more to do with Wall Street than it does with Tesla, and it could continue for at least another week to through the rest of 2014. I never base my expectations for a stock solely on recent price action no matter how much a stock has risen or fallen. However, in this case, some important underlying factors seem to indicate that TSLA may have topped out, and may not move higher for awhile if not until after Thanksgiving. The reason for this has nothing to do with happenings around Tesla’s Gigafactory or new vehicle development. It has nothing to do with international expansion or government subsidies for alternative energy vehicles. To see why, read my article Why Tesla’s Run is Done.

EMCORE Rated Strong Buy

EMCORE (Nasdaq: EMKR) soared 25% last Thursday and was among the day’s greatest gainers. The catalyst was news that the company would sell its Space Photovoltaics Business, along with news of its CEO transition plan and tax loss preservation plan. I have reviewed the press releases and the company’s conference call detailing the activities and have analyzed the day’s drivers of price appreciation. They were value-added actions taken by management with the guidance of investment bank advisory. EMKR is now a more focused business operation with price multiple metrics better aligned to like firms. However, as further value-added actions occur, including cost reductions to find operating efficiencies, and as potential future divestitures follow, I expect EMKR to add value for stakeholders. See my full report on EMCORE.

What’s Good for Bank of America is Good for Real Estate

Bank of America (NYSE: BAC) reported some good news recently that I believe supports the case for the stock. The favorable benefits reach beyond shareholders, though, to serve the entire real estate sector in my opinion. And in turn, like a cycle of life, I expect the benefits from real estate to be paid forward again and back to Bank of America. See the full report on Bank of America here. Article should interest investors in Citigroup (NYSE: C), J.P. Morgan Chase (NYSE: JPM), Morgan Stanley (NYSE: MS), Wells Fargo (NYSE: WFC), U.S. Bancorp (NYSE: USB).

Nostalgic old ad, one of my first created... 

Apple or Google - Which Stock do You Prefer?

If you could only own one of these stocks at a time, which would you own today, Apple (Nasdaq: AAPL) or Google (Nasdaq: GOOG)? Our friends at CNBC posed the question on the air, and I feel compelled to answer it. Without further ado, you should know that I choose Apple over Google (Nasdaq: GOOGL) without reservation, as it stands at deep discount to Google’s share value, but with the high prospect of upside revision to growth estimates and before its new product and service catalysts begin to prove themselves to the investor marketplace. So, while I would own both securities and love Google, if I had to choose between the two, Apple would be my pick today. See my full report, Apple or Google, here.

Amazon Benefits Asymmetrically as Retail Grows

The Census Bureau just reported great news for Amazon.com (Nasdaq: AMZN). Better monthly retail sales were reported for August than economists expected. But that’s good news for the entire industry right? Wrong! Not while Amazon.com continues to steal market share from brick and mortar stores, as is evident in the asymmetric performance of retailers across the spectrum and the suddenly exposed excess capacity in the retail industry. See the full report here, Good News for Amazon.

Facebook’s Mr. Nice Guy Lie

Facebook (Nasdaq: FB) has a philanthropic effort underway in cooperation with internet.org to bring the internet to the two-thirds of the world’s population who are currently unconnected. The social media giant, and others like it including Google (Nasdaq: GOOG), are actively working on this endeavor together. It’s a kind gesture right? No! It’s brilliant business strategy. See Facebook’s Internet Philanthropy is Also Strategic Genius.

Apple EPS Report - Reiterate BUY (Nasdaq: AAPL)

The Apple store in New York City

Apple (Nasdaq: AAPL) earned $7.7 billion or $1.28 per share, which was better than analyst expectations for $1.23, based on Factset data. Apple’s earnings rose on strong iPhone sales into emerging markets including China. The company also noted strong Mac sales, but iPad sales faded year-to-year more than analysts expected. Gross margin expanded to 39.4% against last year’s 36.9% profit, which served as a positive surprise to a market that is concerned about the risk of narrowing margins over the longer term. All signs point toward further rise for Apple shares. The latest result was good enough to hold ground and now investors can look forward to the release of at least one new iPhone and possibly two, each with larger screens. Talk about a wearable watch release is intensifying as well, and rumors of a payments technology is exciting. This is a company that has had starving fans in the investment arena waiting for the next greatest thing for too long now. And 5-year growth estimates for 12.3% could get an upgrade if the company produces some interesting new products this fall as I expect, and the stock is still valued modestly. Entry into the China market was a huge win, and the latest deal with IBM (NYSE: IBM) will allow Apple to take on Blackberry (Nasdaq: BBRY) at enterprises. I reiterated my buy opinion, and recommend readers see my full report: Apple Reports Q3 EPS – Reiterating Buy Here.

NSA Action is Helping Alcatel-Lucent at the Cost of an American Company

When this story about the NSA bugging the products of Cisco Systems (Nasdaq: CSCO) came out in mid-May, it caught my attention because of my regular coverage of Cisco’s rival, Alcatel-Lucent (NYSE: ALU). I expect Alcatel-Lucent to benefit greatly in the months and years ahead, but this revelation about the NSA is something that appears investors are not paying enough attention to yet. I’m relatively certain, global buyers of network gear have a different perspective. Wouldn’t you agree that global buyers of gear, especially those sensitive to privacy, will be more likely to turn to the French based Alcatel-Lucent now, or the Sweden based Ericsson (Nasdaq: ERIC)? For my entire report on this subject, please see NSA Revelation to Drive Alcatel-Lucent Surge.