The best GARP stock you can buy today has 30%+ upside

Good morning!
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The markets are down yet again, like that’s a surprise.

I know you’re busy, so here are my thoughts with the fantastic Start Varney this morning ahead of the opening bell (Watch)

Buckle up and get ready to play ball!

Remember - There is always a way to play offense even if it means playing defense first!!!

**Speaking of which, we’re putting the finishing touches on the October issue of One Bar Ahead™ which will publish this Friday – complete with two new safety-first recommendations, 5 low-risk, high return choices for retirees and more.**

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Here’s my playbook.

A simple 3-step playbook for market chaos

First, doing nothing is a perfectly viable choice. Getting your emotions out of the equation is the single best thing you can do right now. That said, statistically the odds favour buying, even if it’s one share at a time.

Second, now is the time to make sure you own the “right companies”. In my book, that’s low-beta, high dividend companies we talk about frequently. Companies making “must have” products and services are at the top of the list. “Nice to haves” are a risk you don’t want in your portfolio at the moment.

Third, hedge if you can. Inverse funds make this super easy for even the most beginning investors/traders. There is no excuse at this point.

The best GARP stock you can buy right now

Hard to believe but true. There are still stocks out there producing cold hard cash hand over fist. GARP stands for “Growth At Reasonable Price” in case you’re not familiar with the term.

People have no idea what they’re missing. The dividend payout has grown by 259% over the last 10 years, some 3% over the past 3 years alone! AND it has a rock solid, fortress-like balance sheet.

The average price target implies a 30%+ upside. Especially with more aggressive buybacks on the horizon.

As inflation expectations decline, it’ll do even better. Microsoft (MSFT) is growing at double digits and is a worldwide leader in dozens of business segments.

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Bye-bye China, hello India

What’s happening. Apple is moving 5% of the production of their new iPhone 14 from China to India, with some analysts noting that up to 25% of all devices could be produced there by 2025.

Why you should pay attention. This marks an important transition away from China for Apple – which is likely to be followed by many other manufacturers. The risk of a significant supply chain disruption with anything from COVID 2.0 to Taiwan to further cold war antics is simply too much for most.

The move to make. Find companies that are dynamically adapting for the future like Apple. Buy ‘em. Sell any that can’t or won’t adapt.

Ghost kitchens will be new weapon in food delivery wars

Delivery apps like Doordash, Uber Eats, and GrubHub are stuck in attrition mode, with a race to the bottom in price and cash burn.

Ghost kitchens will be the new weapon in the food delivery wars. That’s what you call restaurants that lease out cooking space but have no restaurant or conventional kitchens of their own. But they make PLENTY of money.

I’m keeping my eye on Kitchen United, who just raised $100m in one of the most VC-challenged markets. (Read)

The British Pound is now being priced in ounces

The Pound Sterling plunged after the UK’s new government doubled down on tax cuts and investment incentives to boost growth. (Read)

I think it goes to parity – meaning 1:1 with the US Dollar.

Reminds me of the US. The Bank of England is trying to face down inflation while the government tries to stimulate the economy … exactly like the US Fed which has a fiscal problem because the Biden Administration continues to spend.

‘Nuff said.

Bottom Line

There is always a way to play offense even if one must think defensively first!

Let’s get after it!

Keith

PS: I’ve got to attend to a personal matter this morning so the Monday OBA Update will be out late today.