This week’s BH20 Growth Stocks are again dominated by two themes: (1) The AI Megatrend, and (2) Gold & Silver Stocks are Soaring. You can access the full list in this update, including detailed explanations and data for every stock that made this week’s ranking, plus 5 Reasons Why Gold & Silver Stocks Keep Soaring. Enjoy!
BH Sentiment Index: Despite Pullback, Bulls in Control
Altria: 40 Big Yields Down Big, These 4 Worth Considering
When it comes to income-focused investing, not all big yields are created equally. And from four distinct big-yield categories (including (1) declining businesses, (2) manufactured distributions, (3) selling shares, and (4) well-covered qualified dividend yields), Altria’s category is arguably the best (it’s in the fourth group) and the shares are currently down big and worth considering. This report shares data on 40 big yields (with share prices currently down big), reviews four attractive investment opportunities (from across the four groups), dives deeper into Altria (including a review of the business, sin-stock valuation discount, dividend safety and risks), and then concludes with my strong opinion on investing.
AI Chokepoint Kings: 4 Stocks Control the Entire Megatrend Build-Out
In the accelerating race to build-out artificial intelligence (AI) at scale, just a small handful of companies hold the literal "on/off switches" for the infrastructure powering it all. Dubbed "chokepoint kings," these firms control irreplaceable elements amid surging demand. Here are the four AI Chokepoint Kings, including a description of what they do, how they are currently being valued by the market, and my opinion on investing.
BH20 Growth Stocks: Separating The "Most Liked" from "The Best"
No one has a working crystal ball, but it’s not hard to see where the market is going (e.g. the “cloud AI megatrend,” for example). Where uncertainty starts to creep in is the likely winners (e.g. mega-cap hyper-scalers) versus the less-certain long-term winners with more volatile upside (e.g. the nuts-and-bolts hyper-scaler suppliers and datacenter component makers). This week’s BH20 fast-paced growth stocks shares a handful of top ideas from the latter group (e.g. huge upside “potential” but volatile and less-certain).
BH Sentiment Index: Did You Buy into the Fear (Because it's Over Now)
BH High Income Portfolio: Big Yield, Small Rebalance
The 25-position Blue Harbinger “High Income Portfolio” continues to offer a high yield (currently 9.6%). There have been no new buys or complete sales, but the existing portfolio positions have been rebalanced to trim some winners (trading at higher prices) and add more to attractive opportunities trading a bit lower (attractive). You can access the updated holdings in this report.
Trinity Capital: Despite Risks, 14% Yield Worth Considering
There are lots of ways to earn big yield in this market, and the BDC space (business development companies) is ripe with opportunities. And while BDCs come in a wide variety of shapes and sizes (data is shared in this report), one that stands out is Trinity Capital (TRIN) because of its growth-sector niche (arguably better aligned with the “new” US economy), internal management team (less conflicts of interest) and outstanding 14% dividend yield. This report reviews all of that, plus the big risks Trintiy currently faces, and then concludes with my strong opinion on investing.
Software Application Stocks: Oversold
As the AI megatrend continues to grow, one of the lesser-noticed side effects within the technology sector has been the flow of dollars out of otherwise attractive software companies and into AI stocks. As a result, a lot of really attractive software stocks (those with high growth and high profits) are actually significantly underperforming the market and trading at increasingly attractive valuations.
The S&P 500 Cloud-AI Bubble: Huge Pain Ahead!
Far more money has been lost waiting for the market to correct than in the actual corrections themselves. That is a paraphrase of Peter Lynch, and it’s likely a wise warning for investors in the current “cloud-AI bubble” led by a small handful of US mega-caps stocks. The warning cuts hard both ways, as many investors will likely face huge financial pain in days ahead. This report reviews the current state of the cloud-AI bubble, considers a secular market paradigm shift, discusses the huge financial pain many investors are about to inevitably face, considers a handful of S&P 500 risk metrics and then concludes with my strong opinion on how to defend yourself against the growing cloud-AI bubble.
BH Fear Index: Despite Moody Market, Be Prudently Optimistic
In yet another whipsaw move for the market, investors "bought the dip" driving the BH Sentiment Index from only 20 ("Fear") to now 55 in just one week. It's been a wild and unusual ride over the last 4 weeks as the market "Fear Index" (The VIX) spiked and is now falling, credit spreads widened a bit (and are now shrinking) and growth stocks have come roaring back after the market sold off following Nvidia earnings (which were very good) and now news that Google TCU chips are finding massive inroads with AI.
Top 10 Big Yields Ranked: BDCs, CEFs and Dividend Stocks (Fear Creates Opportunity)
In the market battle of bulls versus bears, fear-and-greed continues to create attractive high-income opportunities (yields of 7-10%+) in specific corners of the market, including business development companies (BDCs), stock-and-bond closed-end funds (CEFs), dividend stocks and more. This report reviews the critical costs and benefits of investing in each of these groups and then counts down (ranks) my top 10 specific big-yield investment opportunities right now (selected from across the groups) as fear is currently creating some very attractive opportunities. Enjoy!
BH20 Growth Stocks: ONDAS Sits Atop (Autonomous Drones)
Top 10 Big-Yield CEFs: This PIMCO Fund Stands Out
If you like big steady income (to offset the short-term uncertainty of long-term stock-market investments), closed-end funds (“CEFs”) currently offer a widely-diverse set (ranging from varied stock and bond strategies) of big-yield opportunities (9%+ yields, often paid monthly) to choose from (ranging from those benefiting from market over-reactions to Fed interest rate signaling as well as otherwise-steady utility sector opportunities being whipsawed by AI’s startling demand for energy). This report shares 10 top big-yield opportunities (including a variety of relevant quantitative data and important qualitative commentary) and dives a bit deeper into one contrarian PIMCO bond CEF that is particularly compelling right now. Enjoy!
BH Sentiment Index: Fear Spikes, Value Salivates, Fast-Paced Growth Takes Cover!
"Market Fear" is currently strong, as the BH Market Sentiment Index has fallen from 83 ("extreme greed") just 3 weeks ago to now 20 (teetering on "extreme fear"). The reason is multifaceted, but the market has posted significant gains in recent months (since "Liberation Day") and investors are increasingly concerned about an "AI Bubble," as well as an increasingly hawkish fed (creeping inflation fears) and unsettled trade agreements with South Korea (we import a lot of steel, semiconductors and cars (Kia, Genesis, Hyundai)).
The Disciplined Growth Portfolio: Moderate, Yet Aggressive
This report shares the latest update on the BH Disciplined Growth Portfolio (38 current positions, not at all equally weighted), including several small new trades as well as a continued focus on powerful long-term growth opportunities. After this week’s stellar Nvidia earnings, a lot of investors are left wondering “what unexpected, good news can possibly remain for this already unprecedented AI growth story?” And the answer, of course, is building a prudently concentrated long-term growth portfolio that will benefit from AI (including AI hyper-scalers and “picks-and-shovels” companies”) but also healthy growth businesses benefiting from opportunities beyond just AI. Enjoy!
BH20 Growth Stocks: Aggressive Longs → Now Aggressive Shorts
The rats are abandoning ship as the top performing AI and growth stocks this year are quickly becoming top short candidates (look out below!). Specifically, the hard selloff in speculative AI stocks (over the last 2 weeks—see table) is not something I am buying as the BH Sentiment Index has fallen sharply (Now 38 out of 100—Fear!)—and it’s not the type of fear I am buying. Previous top ranked growth stocks (e.g. IREN and Bloom Energy) are crashing.
BH Fear & Greed Index: Speculative Stocks Are at Risk
Market "Greed" is tumbling, with the BH Sentiment Index falling from 83 two weeks ago, to 50 last week, and now only 38 (Fear). This is an increasingly attractive time to buy quality stocks that have sold off (be contrarian), however speculative growth stocks (e.g. the "AI/Growth Bubble") is at risk of falling further…
BH High Income Portfolio: 9.5% Yield, Lots of Opportunities
The drumbeat of “AI/Growth Stock Bubble” marches on, yet high-income investors continue to sleep well at night. If you are a member of this distinguished income-focused group (or even just a casual small-time allocator), BDCs, stock & bond CEFs and dividend stocks continue to offer attractive opportunities. This report shares the latest update on the BH High Income Portfolio (25 positions, 9.5% aggregate yield) and one 13.7% yield BDC in the portfolio that I am watching closely. Enjoy!
Main Street Capital: What Bubble?
Investors love to look at Main Street Capital’s relatively high price-to-book value and immediately declare it an overvalued bubble of a Business Development Company (“BDC”). But what many investors don’t realize is it’s a fundamentally different type of BDC with its steady net asset value (“NAV”) gains (while peers stay relatively flat—or worse). So while some thumb their nose at Main Street’s mere 5.3% dividend yield (puny in the BDC space), they fail to recognize the steady dividend growth, plus the powerful supplemental dividends, as well as the many other attractive qualities that set it apart (i.e. low debt, strong liquidity, above-average pipeline, healthy portfolio, efficient operations and macro resilience). This report reviews all of that (and the big risks) and then concludes with my strong opinion on investing.