For better risk/reward, one potential category is the defensive sectors and permarisers. These are companies and sectors that have outperformed. My favorite example right now is Hershey's (HSY). The stock made a new all-time high in August. You can plainly see the lifetime support line, the accelerated support line from 2009 and the even steeper ascent from 2020. It is a 30 percent trip down to the 2009 support line and 50 percent down to the lifetime support line. If I'm right about this bear market, Hershey's will start experiencing a rapid drop once this current trendline is lost.
These are tough plays because until they crack, they keep rising. Timing is everything with these, but many permarisers have turned to trash in this bear market. Paying 25 time earnings for a company growing earnings at 10 percecnt isn't value and it isn't defensive. Eventually, these stocks will be dumped.
Steady Ship
-
FEEDFor all of its insanity in the late 1990s, Amazon has turned into a
placid, stable, and frankly boring stock. That’s no problem for the bulk of
people ...
No comments:
Post a Comment