Global stock markets had a quiet week, with the Dow Jones up 0.35%, S&P 500 rising 0.39% and NASDAQ jumping 1.21%. The MCSI Emerging Markets Index had its first positive week in a long time by rising 0.53%.
Big gainers in your Bull Market Alert portfolio included Priceline.com (PCLN), which jumped 7.16% in its opening week among your holdings. With your January $1,100 calls (PCLN150117C01100000) up 112%, sell your options here to lock in these big gains. I’ll be making a new option recommendation on this position once the stock consolidates its recent gains.
The WisdomTree Japan Hedged Equity ETF (DXJ) and Euronet Worldwide (EEFT) rose 2.79% and 2.51%, respectively. Euronet Worldwide (EEFT) also hit a new 52-week high.
This week’s Bull Market Alert recommendation, Norwegian Cruise Line Holdings (NCLH), is both a momentum play and a bet on one of the most compelling demographic trends of our time — an aging Western population.
Here’s why I expect Norwegian to continue its strong run during the next two months.
First, a wealthier generation is entering retirement, and that’s terrific news for cruise line operators like Norwegian. Retiring baby boomers are taking to cruises like never before — and that megatrend is accelerating.
Second, because Norwegian is smaller than its competitors Royal Caribbean (RCL) and Carnival (CCL) in both sales and market cap, it is growing faster than its competitors. Norwegian has strung together six straight quarters of double-digit percentage sales growth. Most recently, its quarterly profit rose 29% to $1.11 a share. Sales rose 14% to $907 million. Norwegian also recently announced plans to acquire Prestige Cruises for just over $3 billion, giving it a much-needed presence in the luxury cruise segment.
Third, the stock has a lot of momentum, hitting an all-time high in its most recent run. And as we’ve seen, this is the time of year to be betting on momentum stocks.
So buy Norwegian Cruise Line Holdings (NCLH) at market today, and set your stop at $35.00.
I’m holding off on recommending options on this one until the stock consolidates its recent gains.
Portfolio Update
Gilead Sciences Inc. (GILD) lost 4.12% over the past five trading days. GILD has pulled back over the past two weeks as the biotech bull takes a breather. It’s worth recalling that GILD is up an average 35% per year for the past five years and is up over 48% in just the last 12 months. GILD dipped below its 50-day moving average (MA) last week to become a HOLD.
PowerShares DB Commodity Tracking ETF (DBC) fell another 1.55% last week, hitting another new 52-week low. The downtrend in commodities continues the winning streak for this short-sell position in your portfolio. You took half of your DBC option position off last Friday to lock in a one-month 55% gain. DBC remains a SHORT SELL.
WisdomTree Japan Hedged Equity ETF (DXJ) added 2.79% last week as it moved back towards its recent 52-week high. And, the good news continued last week for your position on the Japanese recovery as the NIKKEI index hit a fresh seven-year high. Continuing enthusiasm endured as reports surfaced that Prime Minister Shinzo Abe would put off a tax increase that was planned for the near future. DXJ remains a BUY.
Euronet Worldwide (EEFT) gained 2.51%, hitting a new 52-week high for its first week in your portfolio. EEFT is another one of the electronic payment giants seeing wildfire growth as of late. With the unrelenting growth of mobile devices, and intense interest in electronic payment solutions such as the recently launched Apple Pay, big players like EEFT are in a sweet spot with a long prosperous future ahead of them. EEFT is a BUY.
Priceline.com (PCLN) jumped 7.16% for its opening week in the Bull Market Alert portfolio. My hunch proved right last week as PCLN recovered from overly zealous selling in the wake of its recent earnings report. PCLN is a BUY.
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