Many companies still operate in the real world, where they have to manufacture and ship out physical goods. That can include anything from raw commodities to advanced computer chips. Each of these companies will look at its inventories to gauge their success. Rising inventories likely means slowing sales, and in turn, slowing revenues. Declining inventories can signal the opposite, that sales are on the rise, and maybe even that raising prices might be a good idea. Networking equipment manufacturerCisco Systems (CSCO) has been challenged with its inventories in recent quarters. Cu...

Earnings season is often full of surprises. That means a company can report great results, but sell off as traders didn’t think they were good enough. Or a company could lose money, but not as much as expected. When that happens, shares often soar. This can happen across any sector. But a great company in a long-term uptrend will likely keep moving with that uptrend, even amid any earnings season silliness. The latest market overreaction has hitMarriott International (MAR). The hotel chain beat earnings estimates, but their guidance fell below expectations. That led to a sharp sellof...

Long-term investors still have a wide shopping list of great companies trading well off their highs. Many stocks outside of the big tech space make the grade. Especially companies that have strong brands. The past few years have shown that high inflation can weigh on a company’s profitability. But a great company can keep raising prices faster than they lose customers. In that situation, they’re set up well for long-term inflation, even if it slows back to lower levels. That also means that market-lagging brand stocks stand a chance to make above-average gains this year. One such ...

The market rally since late 2022 has been driven by tech stocks, particularly large cap tech stocks developing artificial intelligence (AI) opportunities. That’s caused other sectors of the market to lag. Over time, improving earnings from these sectors is creating a better value. Investors may want to take some profits in high-flying tech stocks now that markets are soaring to all-time highs. Other companies can likely help push stock indices higher this year as they play catch-up with the overall market. For instance, food giantMondelez International (MDLZ) sold off a bit last year...

Customers can have rapidly changing tastes. A company needs to provide products or services that meet those tastes, but can also be flexible over time. Sometimes, a company will be behind the curve in adoption to changes. Once they figure it out, however, shares may start to trend higher. As that happens, market expectations for a company can shift, resulting in a company going from being out of favor with the market to moving in favor. The latest company making the right moves isThe Walt Disney Company (DIS). The media giant reported better-than-expected earnings. And losses on its ...

While the market may take a pause in the coming weeks based on seasonal trends, it’s clear from earnings season that many companies are growing. And that they can continue to do so. That’s growth as measured by an increasing number of customers or an increasing number of sales. With investors still worried about the economy, companies delivering real growth can likely trend higher, and be a solid buying opportunity in the coming weeks.Uber Technologies (UBER) is one such growth play. They saw gross bookings jump 22 percent in the fourth quarter. That helped the rideshare company handily...

Technology stocks offer investors the best bang for their buck. They’re the growth leaders and can see big price swings. Over time, a tech company that can go from an early-stage idea to turning an actual profit can continue to trend higher. The market still cares about these opportunities today, as interest rates stay high and early-stage investors remain skeptical. That’s good news for firms that can become consistently profitable. Big data companyPalantir Technologies (PLTR) is sustainably profitable in the eyes of the market, now that it’s finally had its first full-year of profi...

Investment capital continues to pour into artificial intelligence projects. As the software improves, better hardware is needed to run more advanced programs. And better facilities are needed to house and operate the hardware operating the software. That’s why some non-tech stocks are taking off now. They’re a stealth play on the AI trend, and can continue to benefit from its long-term rollout. And these companies can benefit from other trends that happen along the way. One such trend is construction. New facilities can take years and cost hundreds of millions of dollars to build out...

A company’s fortunes can ebb and flow. Changes in customer demand can lead to fat and lean years. Or a company can have to deal with ongoing obsolescence. A further category of companies can suffer from one-off events. How a company reacts from such an event can affect how that company recovers. And for many of today’s one-off issues, understanding the ongoing costs, if any, can also have a big impact. For instance, cybersecurity attacks are on the rise. That’s impacted some companies more than others. For consumer goods giantClorox (CLX), last year’s cyberattack caused massive inven...

Earnings season offers investors the opportunity to profit from market overreactions. That’s because a company can have a great quarter, but still see shares decline. Or vice versa. What matters most is to determine if the market is overreacting. If the market has overreacted to the downside, investors may be able to earn a quick profit as shares rebound. Or it can allow an investor to build a stake in great companies at a reasonable price. One such opportunity now is with industrial conglomerateHoneywell (HON). The company beat on earnings and showed strong revenue growth. Plus, Hon...