U.S. stock markets closed a mixed week, with the Dow Jones down 0.12%, the S&P 500 rising 0.16% and the NASDAQ falling 0.10%. The MSCI Emerging Markets Index continued its bullish ways by rising 0.75%.
There is a big change coming for your subscription to Bull Market Alert. The details about that are below, so be sure to read the entire alert.
This week’s recommendation takes us back to a Silicon Valley tech play in the form of San Jose, California-based Sanmina Corporation (SANM).
Sanmina is a global electronics manufacturing service. That means the company makes the equipment that you buy under more recognizable brands. Sanmina’s clients include companies in the communications networks, computing, and storage, medical, defense and aerospace, industrial and semiconductor, multimedia, automotive and clean technology sectors.
With nearly 80 manufacturing sites in 27 countries on six continents, Sanmina has been a Fortune 500 company for more than 15 years.
As the chart below confirms, Sanmina’s shares have been red hot over the past year.
Sanmina Corporation (SANM) versus the S&P 500 over one year.
Here’s why I expect the shares to move higher in the coming months.
First, the company consistently under promises and over delivers. Most recently, Sanmina’s shares soared almost 9% after the company reported its fiscal Q1 revenues rose 12% year over year to $1.72 billion, with earnings of 75 cents per share. That trounced analysts’ revenue expectations of $1.69 billion and earnings of 67 cents per share. The company’s guidance is similarly bullish for the coming quarter.
Second, the company is a favorite among Wall Street’s smart money. Sanmina was in 20 hedge funds’ portfolios at the end of Q3 2016. Also, over 10 small-cap exchange-traded funds (ETFs) I track also invest in Sanmina. That makes it one of the most popular small-cap bets on Wall Street.
Finally, Sanmina scores 100% across the board on a proprietary set of short-, medium- and long-term momentum indicators I have developed recently (Read about that below).
So buy Sanmina Corporation (SANM) at market today and place your stop at $34.00.
With the stock surging in recent days, I am holding off on recommending options for now.
As I noted above, I have been developing a proprietary momentum trading system over the past six months.
The results of this system have been impressive, to say the least.
So much so that my publisher and I have been working hard behind the scenes to launch a trading service based purely on its recommendations.
We are calling this new trading service Momentum Trader Alert — and it will be replacing your Bull Market Alert subscription.
Momentum Trader Alert is a technical trading system that identifies stocks and ETFs that are expected to rise over the coming six to 12 weeks.
Specifically, the system does so by tracking a combination of 13 different short-, medium- and long-term technical momentum indicators.
Only when each and every one of these 13 technical indicators lines up at 100% does the system makes a “buy” recommendation.
Out of a possible 5,700 stocks and over 1,000 ETFs, it screens out literally the “best of the best.”
Once again, I am very excited about making this trading system available to you and all of my subscribers.
So look for Momentum Trader Alert to replace your Bull Market Alert subscription starting next week. All of the terms of your current subscription will remain in place.
You booked two double-digit percentage gains this past week. Texas Capital Bancshares (TCBI) stopped out at $82.35 on Jan. 30 for a 10.02% gain, while Coherent Inc. (COHR) also stopped out at $153.20 on the same day for a 10.02% gain.
Finally, I’ve put all of your current Bull Market Alert recommendations through my new Momentum Trader system. I’m happy to report that all but three of your current positions made it through the first cut.
So this week, I am recommending that you close your positions in Home BancShares, Inc. (HOMB), PDC Energy Inc (PDCE) and The TJX Companies, Inc. (TJX).
All of your remaining Bull Market Alert positions will be transferred to your new Momentum Trading Alert portfolio.
Nicholas A. Vardy