Great results often spring from low expectations

Good morning!

‍I’m back in the PNW after a super productive, super busy week!

The markets are scrubbing a bit off the top after SNAP and TWTR earnings on the heels of an otherwise strong week.

Here’s my playbook.

All 3 averages set for weekly gains

All three major indices have tacked on strong results this week with the Nasdaq up 5.3%, the Dow tacking on 2.4% and the S&P 500 rising 3.5% as I type.

If you’ve been reading along for any length of time, you knew that this was coming. Hopefully, you took action!

As I noted in late June, we could see a pretty decent rally because the psychology has changed and that enough “damage” had been done to share prices.

Two weeks ago, I shared a screenshot of the One Bar Ahead™ Strength Meter to reiterate make my point by highlighting the VWAP. As you can see, it was precisely on track.

Why you should care: There is still plenty of room to the upside, especially for top-tier names like those we talk about frequently! It won’t be in a straight-line mind you, but the energy is very clearly there.

Key Point: People talk prices all day long, or technicals, or fundamentals but what they fail to incorporate into their analysis is psychology. A little good news can go a long way, especially if you’re prepared for bad news.

Think about this: Roughly 21% of the S&P 500 have reported and 70% of those that have beat analyst expectations.

Social media stocks are still anti-social

I’ve been railing on social media stocks for the better part of a year now, saying that companies like Meta, SNAP and Twitter are going to come under significant pressure because of changing advertising models, public trust issues and more.

Cut it any way you want, but the fact is that people are just flippin’ tired of watching hopelessly good-looking, impossibly wealthy folks they don’t know live entirely fabricated lives on sun-drenched shores most will never visit.

Not that I’m a cynic or anything.

SNAP got popped.

Shares are down 30% after reporting Q2 results that are anything but inspiring. Naturally, META and Pinterest are off the mark, too.

Continue to avoid all three.

Normally, I’d suggest put options or another downside play, but the reason I am not is because Wall Street’s greedy pirates – aka bigger well-capitalized traders – want to “defend” all three names. And that’s a fight you don’t want.

Twitter – the dog ate my homework

Twitter reported Q2 results short of expectations but gimme a break. The company missed on earnings, revenue growth and the increasingly important and controversial “user growth.”

Management blamed the ad industry and “uncertainty” related to Musk’s aborted acquisition, but that’s a lot like the “dog ate my homework.”

Good management could fix that. You know it, I know it and, importantly, Musk knows it.

Just sayin’…

I tried to buy Twitter a few weeks back but wound up taking a quick exit at a loss. I’d love to re-enter shares, but the situation is a complete wildcard and I don’t like the odds under the circumstances.

Fitz Picks

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I began my week with an appearance on Fox Business Network with the fantastic Ashley Webster sitting in for Stuart Varney. He asked me where I’d put my money for the week ahead of the opening bell.

I noted three choices: INTC, NVDA and TSLA which are up 4.8%, 11.8% and 15.2% versus the S&P 500 which has tacked on a still healthy but smaller 4.2% over the same time frame as I type.

I hope you got on board and have a big, cheesy smile on your face like I do!

Perhaps, I should travel more often!

All joshing aside, I really do hope you are on board with these names.

Why?

For the simple reason that it has never been more important to concentrate your money on the very best companies you can buy.

I’ve got 15 additional stock recommendations in the One Bar Ahead™ model portfolio, and I’d love to earn your trust, goodwill, and business if that’s of interest. (Learn more)

The surprising real reason Amazon bought One Medical

Amazon announced plans yesterday to acquire One Medical, a national chain of primary care clinics, for $3.9b.

Most people are focused on the virtual visits part of that deal, but they’re missing the point.

Amazon could give a rip about the virtual visits that everybody is falling all over themselves about this morning.

Why this really matters: One Medical has nearly 15 years’ worth of health data, which Amazon will undoubtedly use to train the company’s medical AIs. What’s more, there’s no doubt in my mind that the company will also use that as a springboard into additional critical care like the joint cancer treatment in conjunction with Seattle’s Fred Hutch that I brought to your attention recently.

Anybody owning insurance company stocks would be wise to take note! We’re probably about 3 years away from widespread Amazon Care, perhaps less.

Bottom Line

Most fail in the markets because they want instant gains while seeking to avoid instant pain.

The truly successful take personal responsibility for both. They address their fears head-on.

This summer is a great example of what I’m talking about.

People who continued to buy in as I’ve repeatedly suggested are now in a position to trim profits. Those who went to the sidelines are trying to play catch up.

Let’s finish the week strong!

Thanks for reading along, following along and watching this week as I hit NY. I’ll have a variety of my media appearances and thoughts parsed later today and available via YouTube shortly.

You ROCK!

Keith