Author Archives: Scalper1

5 Chip Stocks To Watch Are Moving Up, With Apple’s Big Event March 21

A basket of top-rated chip stocks are making moves around buy points now, with several moving up in Friday trading. And Apple ( AAPL ), a big user of semiconductors, just sent out press invitations for a March 21 event where it’s expected to introduce a small iPhone and another iPad. So which chip stocks are highly rated by IBD and get at least some of their business from Apple?  Broadcom ( AVGO ), IBD Leaderboard stock  Macom Technology Solutions ( MTSI ), Cirrus Logic ( CRUS ), Mellanox ( MLNX ) and Nvidia ( NVDA ) make the list. All are at least somewhat diversified, with revenue streams in everything from data center and mobile networking systems to powerful graphics chips for virtual reality and gaming, to connected car technology and now even artificial intelligence. Chips And Profit IBD 50 stock Broadcom was up more than 3% in midday trading in the stock market today , putting it just above and out of buy range from a double-bottom base. Macom was up nearly 6%, similarly above its ideal buy range. Broadcom and Macom Technology Solutions made IBD’s Stocks on The Move screen Friday, heading up in high volume. Broadcom made Thursday morning’s screen too. Early Thursday, Broadcom’s management team had presented at a Susquehanna Financial analysts’ conference. “It’s a great time to operate in the semiconductor industry,” CEO Hock Tan said there. “You have a substantial profit pool … compared to similar industries of the same size.” Loading the player…   Broadcom had started giving up some of its gains as stock indexes dipped into the red with falling oil prices, but it ended up with a 1.7% rise Thursday. Several other top-rated chip stocks moved up early Friday after declining Thursday. Cirrus Logic was up about 3% at midday. Mellanox was up 2% and Nvidia was up fractionally. On Thursday, Mellanox had slipped to the bottom of buy range, as had Macom Technology Solutions, while Nvidia had edged down to about 4% under a buy point from a cup base. While the stock market’s in a confirmed uptrend, much of the action is choppy with ups and downs in oil prices and economic concerns around the globe. Going into Friday trading, all five of these top-ranked chipmakers had fallen from a week ago, between 1% and 7%, with the S&P 500 index down 1%. Cirrus Logic and Mellanox were up 14% and 15% this year, respectively — the only ones of the five with notable gains. Nvidia, an IBD 50 stock, has the strongest IBD Composite Rating of the bunch, a best-possible 99, taking into account earnings growth, stock price gains and several other metrics. The others range between 90 and 98 in Composite Rating. Apple Chips It will take awhile for teardowns to show whose chips go into whatever new products Apple introduces, and longer for those chips to translate into reported sales, and lagging iPhone sales growth lately hasn’t helped the chips. Apple Sets March 21 To Launch Small iPhone, New iPad, Watch Bands https://t.co/MxIpxMFKvc pic.twitter.com/iPxQ1lTAFF — Investors.com (@IBDinvestors) March 10, 2016 Other markets are driving growth, however. Nvidia, for instance, said in its fourth quarter report, in February, that it’s at the “center of four exciting growth opportunities — PC gaming, VR (virtual reality), deep learning and self-driving cars.” Nvidia is a partner to electric car maker  Tesla Motors ( TSLA ) and other auto manufacturers, and said last month that it’s in an alliance with Facebook ( FB ) and Chinese Internet company Alibaba Group ( BABA ) for speedy artificial intelligence chips.

Facebook’s Dominance In App Ecosystem Is Striking, Above Alphabet

Facebook ( FB ) completely dominates the app field, taking a 60% market share in February, led by its WhatsApp and Messenger properties. Alphabet ( GOOGL ) followed Facebook in app downloads, with YouTube being the most popular, according to an analysis by Nomura. Netflix ( NFLX ) also showed impressive strength, while Spotify outpaced Pandora Media ( P ). “With apps representing about 80% of total time spent on mobile, the importance of app trends is difficult to understate,” wrote Nomura analyst Anthony DiClemente in a research report. “App user trends have major implications for industry and company-specific shifts in consumer behavior, and ultimately advertising spend trend.” User engagement trends are leading indicators of mobile ad spending. DiClemente estimates mobile ad spend should reach $75 billion globally in 2016, growing 44% year over year. Alphabet and Facebook scored big in a recent survey of advertisers, receiving the highest budget allocations and the best return on investment of digital media properties. DiClemente examined 14 of the most prominent social apps on both the Apple ( AAPL ) and Alphabet Android operating systems. The apps covered were downloaded a total of 217 million times in February. In the analysis, using data from SensorTower , DiClemente said Facebook properties held the top four spots in the global app download ranking and comprised a full 60% of the 217 million downloads. WhatsApp and Messenger held the top two spots, with nearly 40 million downloads each. For comparison, the Facebook flagship app was downloaded 30 million times in February, while Instagram posted 22 million downloads. Messenger is generally stronger in the U.S., while WhatsApp remains the preferred messaging service internationally, DiClemente said. “The strength of Facebook’s app portfolio reinforces our view that Facebook maintains a user growth and monetization runway,” DiClemente wrote. YouTube was by far the most popular suit of apps by Alphabet. It was downloaded 12.5 million times, far outpacing Google Gmail. But many Google apps come preloaded on Android phones and likely understates Google’s prominence, DiClemente wrote. Following YouTube, music sharing site Spotify tied with Netflix, with both showing 7.9 million downloads. Spotify competitor Pandora had 5.3 million downloads. Pandora still leads in the U.S., but Spotify is beating Pandora by 75% in global downloads. At Netflix, international downloads surpassed domestic totals following January’s expansion into 130 countries. Alphabet and IBD 50 company Facebook carry best-possible IBD Composite Ratings of 99. Both were up more than 1% in midday trading in the stock market today , with major stock indexes up. Image provided by Shutterstock .

The Fox And The Hedgehog

“The fox knows many things while the hedgehog knows one big thing.” Click to enlarge Photo: Jeremy P. Gray The Greek poet Archilocus noticed this almost 3,000 years ago. We often see two different types of people. Some people go everywhere and study everything – pursuing contradictory ideas. They’re eclectic, diffused, and omnivorous. On the other side are souls who pursue a singular, unitary vision, an all-embracing organizing principle that gives the world coherence. We see this all around us. In literature, Dante was a hedgehog: he wanted to give the world a great poem about heaven and hell. Shakespeare, on the other hand, was a fox. He wrote plays about everything and everybody. In history, George Washington was a hedgehog – with the simple idea of American greatness – while Thomas Jefferson was a fox. And in modern life, outstanding business leaders are hedgehogs: think of Steve Jobs with his focus on design and functionality. And superior investors are often foxes: Warren Buffett, Peter Lynch, John Templeton. Both approaches are necessary. In business, a company needs a singular vision to cut through the clutter and make the main thing the main thing. It’s too easy to get distracted by the crisis of the day and never spend time or energy on what’s crucial. Hedgehogs get things done and keep their teams focused. But with investing, foxes rule. A portfolio needs to be diversified, limiting its exposure to any single area – reducing risk – while spreading its assets among an array of industries that generate new products and ideas – improving return. Investors need to be fox-like and flexible. And they have to be interested in everything, from genomic sequencing to quantum computing to chain-store sales to bitcoins and block chains. Investors should leave no stone unturned when searching for value. Foxes and hedgehogs each have an important role to play. A lot of times, they end up married to each other. Which one are you?