Most industries tend to consolidate over time. That’s because they start out with a large number of players. As those who are overleveraged or poorly managed go bust, the better-run companies start to buy up worthy competitors to build their market share. This trend is currently underway in the gold sector. A number of deals have occurred in the past few years that have set records. And this week saw yet another merger announcement that will further keep competition down. The latest move isNewmont Mining’s (NEM) acquisition of Australian gold and copper company Newcrest. Valued at $1...

While the stock market has fared well so far this year, investors have been more cautious going into earnings. And most companies have reported a slowdown, but overall it hasn’t been as bad as expected. The wild card is the housing market. Rising interest rates and fewer homeowners looking to sell are creating a tight market, but one where prices could potentially drop. In that environment, homeowners may slow down home maintenance or improvements. That’s the fear going into earnings for big box home improvement stores likeHome Depot (HD), which reports earnings this morning. It’s a ...

One of the most powerful long-term investment trends is to invest in a company with a durable competitive advantage. For most companies today, that usually means offering a unique product that’s protected by a copyright or patent. Even though patents are temporary and copyrights won’t last forever, once a brand has been built, it can stand the test of time. And that can lead to higher returns versus investing in generic competitors. In the world of entertainment brands, it’s tough to argue againstThe Walt Disney Company (DIS). Yet the company’s most recent earnings disappointed, part...

2023 has been a strong year for stocks so far. Even if the market flattens out from here, it will still be a much better year than 2022. Those looking to buy today won’t get the extreme lows from last October or December for most stocks. Rather than pile into stocks that have done well, investors may do better by focusing on income stocks rather than growth stocks for the time being. Fortunately, many companies have continued to grow their dividends. One relatively high-yielding company is retailerTarget (TGT). At their lows, shares were nearly cut in half from their all-time highs. ...

While the overall market has its ups and downs, individual stocks can have more extreme moves. When a company has an extreme rally higher, its shares may be more susceptible to a pullback. The reverse is true when a company has been falling relative to peers. This concept is known as reversion to the mean. And it’s a sign that investors might be able to find buying opportunities in beaten-down stocks. Or traders can find overpriced stocks to target for a drop. Right now, a reversion to the mean trend looks possible inParamount Global (PARA). Besides missing on earnings last week, the...

Years of ultra-low interest rates made it easy for companies to issue debt at a low cost. As a bonus, companies could even deduct their interest payments for tax purposes. Today, with interest rates rising, it makes less sense for companies to take on debt. They would need a project with a high prospective return to justify the costs. So companies paying down debt rather than looking to add more or refinance at today’s relatively high rates may offer solid returns. One company paying down debt right now isOccidental Petroleum (OXY). Like many big oil players, holding off on investing...

While traders are often looking for a quick trade, many so-called investors are often looking for a stock that can move higher quickly. By focusing instead on companies that can deliver steady, long-term growth, however, they may fare better than getting on the wrong side of a growth story that goes bad. These long-term plays can often by found by being household names, which may indicate a strong brand. Or they may be dividend payers. Often, they’re both. One household name that may not be an obvious investment idea isCarrier Global Corporation (CARR). A manufacturer of HVAC systems...

While earnings are the most important part of earnings season, they’re simply a yardstick that considers different accounting measures across different sectors. A different measure, cash flow, can give a sense as to a company’s ability to start and grow a dividend, buy back shares, or otherwise reward shareholders. That cash flow may not always pass down to earnings. But for a poor investment, it’s often true that earnings will look higher than cash flow indicates. With a slowing economy and slow sales environment for smartphones,Apple (AAPL) was looking dicey going into earnings. Ye...

A company can have a great product. Or a great marketing team. But if management isn’t good… the company will falter. Even a manager who knows to step aside for the team is better than an executive who makes the wrong decisions and ignores what the staff has to say. This can translate into great stock returns… or poor ones. So all said and done, company management is a key factor, even though it doesn’t show up on the balance sheet. Investing with management teams that support shareholders – and are big shareholders themselves – can be crucial for investment success. And in today’...

Earnings season can create a tremendous amount of short-term noise. Companies tend to focus on 90-day sprints, rather than the long run, to keep Wall Street happy. But even with that short-term focus, a company can be working towards long-term goals and get hung up in the short run. That’s especially true when a company plays to long-term trends but hasn’t seen the cycle turn favorable for those trends yet. In the tech space, chipmakerAdvanced Micro Devices (AMD) took a hit after earnings. Specifically, the company provided weak guidance for the personal computer market in the quarte...