ONE-TWENTY TWO: Trading Financial Markets
Exploring the poetry in financial markets for students of money and economy since the year 2000.
Introduction The U.S. housing market follows a seasonal pattern. The spring selling season typically represents the year’s peak of activity in the housing market. During this time, households try to settle into a new home before summer travel or well ahead of the Fall start to the next school year. Like retailers who eagerly anticipate … Read more
Question. When an analyst lowers the price target on a stock to a level still substantially higher than the current price, what do you expect to happen? What if that price target comes with a downgrade from buy to neutral? If you answered lower, you win a prize… a discounted price on homebuilder stocks. A … Read more
Sometimes it pays to be stubborn. In December, I asked whether Beyond Meat (BYND) would be the speculative trade of the new year. I presented a simple thesis that managed to work out. However, the path from A to B was totally unexpected, and I broke rules along the way. In response to earnings, BYND … Read more
Alexandria Real Estate (ARE), a real estate investment trust (REIT) specializing in life science buildings, gets much love from analysts. According to Factset, ARE is currently one of the most loved companies in the S&P 500 (SPY). ARE is just one of two stocks whose analyst coverage consists 100% of buy ratings. This high “occupancy … Read more
I assumed the seasonal trade on home builders came to an end some time in May. However, the tailwinds lifting builders higher remain as strong as ever. This strength and outperformance has confused and confounded those assuming higher interest rates would mean disaster for the housing market and an eventual recession. A recent upgrade for … Read more