Magnifi Communities, Author at Magnifi Communities

How to Get Your Energy Income Without K-1 Hassle

Investors Alley / By Magnifi Communities

A lot of investors avoid Schedule K-1 reporting investments. These tax reporting documents can add significant extra work at tax filing time. On the flip side, K-1 investments typically pay tax-advantaged distributions. There exist a matched pair of stocks that lets us see how much the investing public values the simplicity of Forms 1099 over Schedules K-1.

One problem with K-1 investments is that owning this type of security in qualified retirement accounts such as IRAs can lead to significant tax expenses and penalties.

So, let’s go over a very popular energy income investment that uses K-1s – and see how you can get similar payouts without the K-1 hassle…

Companies organized as partnerships send out Schedules K-1 to limited partners for tax reporting. There are publicly traded partnerships, and you can spot them by the LP at the end of the name. Energy midstream master limited partnerships (MLPs) are the most common type of publicly traded partnership. There are also financial firms and shipping companies organized as partnerships. Again, most LPs send K-1s, but not all. The only way to check for sure is to go to a company’s investor relations web pages.

Plains All American Pipeline LP (PAA) is an MLP that owns and operates crude oil pipelines and storage facilities. PAA recently restarted distribution growth, and it is one of the most attractive MLPs for income-focused investors.

The distributions paid by MLPs are not taxable income. They will be classified as a non-taxable return of capital. The tax consequences of owning MLP units come when you file taxes and report the Schedule K-1 information. You benefit from non-cash expenses that reduce taxable income as a limited partner. In general, the income from MLP investments can be viewed as tax-free income.

Plains GP Holdings, LP (PAGP) is a limited partnership where each share is backed by one PAA unit. PAA and PAGP are essentially equivalent investments, except that PAGP sends out a Form 1099 for tax reporting. The 1099 reporting means you do not have the Schedule K-1 filing challenges. PAGP distributions pass through the tax advantages of MLP distributions, and PAGP shares are safe to own in qualified retirement accounts.

Due to the differences between 1099 and K-1 reporting, PAA and PAGP trade at different prices; however, they do pay the same dividend rates.

As I write, this PAA is priced at $12.72 and yields 8.41%.

PAGP shares trade at $13.20, giving a yield of 8.11%.

Investors who pick PAGP over PAA pay a 3.8% premium to avoid potential Schedule K-1 issues. Put another way; the 0.3% yield difference equals $30 per year of income per $10,000.

In my Dividend Hunter service, I have a policy of never recommending any K-1 reporting investments. I am happy Plains offers a 1099 reporting choice, and I have PAGP as one of my recommended investments.
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The Best Stock to Invest $1,000 in Right Now

StockNews.com / By Magnifi Communities

The stock market provides wealth creation opportunities regularly. The market started the year positively on the back of improving macroeconomic data. However, many wealth-creation opportunities still exist as several high-quality stocks are available at a discount after a difficult 2022. Pharma major Pfizer Inc. (PFE) ended 2022 on a solid note, with its EPS beating

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2 Gold Stocks To Add To Your Watchlist

INO.com / By Magnifi Communities

2023 has been a great year for investors thus far, with several asset classes enjoying double-digit year-to-date percentage gains, including the Nasdaq 100 Index (QQQ).
While it may be lagging short-term after a strong November and December, the strongest performance has come from the Gold Miners Index (GDX), which outperformed the Nasdaq 100 by more than 3500 basis points in 2022, and is up 46% off its Q3 2022 lows.
Following this strong rally in the GDX and a surge in optimism among investors, some consolidation or a deeper pullback would not be surprising.
However, it’s worth building a watchlist of undervalued now to prepare for sharp pullbacks, assuming these stocks retreat into a low-risk buy zone.

In this update, we’ll look at two gold names still trading at deep discounts to fair value and highlight their low-risk buy zones:
Argonaut Gold (ARNGF)
Argonaut Gold (ARNGF) is a gold producer with a market cap of $430 million and was a name I highlighted in November as one to keep a very close eye on, and I stated the following:

To summarize, this pullback in the stock has provided a fire sale, and I don’t recall the last time I saw sentiment this bad for a producer in years.

Since that update, the stock has soared by more than 60% and is one of the top-performing gold producers by a wide margin.
This is partially attributed to the strong recovery in the gold price that has placed a relentless bid on gold miners but also due to several positive developments.
The major one worth discussing is the appointment of a new Chief Executive Officer, Richard Young, who is well known for transforming Teranga Gold from a junior producer into a $2.0 billion miner before its eventual takeover in late 2020.
This recent development is a huge upgrade to the investment thesis, given that Young is a very competent company builder with a wealth of experience in the sector (30+ years), beginning with Barrick Gold (GOLD) in 1991.
Most importantly though, this transition occurs during a pivotal period for Argonaut Gold as the company is barely two months away from its first gold pour at its Magino Project in Ontario, Canada.
As discussed in my previous update, Magino is a game-changer for the company, given that it will catapult Argonaut from a 250,000-ounce producer to a 370,000 to 400,000-ounce per annum producer, with Magino’s costs set to be well below its current cost profile.
Assuming production comes in as expected (150,000+ ounces per annum at sub $1,000/oz all-in-sustaining costs at Magino in the first five years), we would see Argonaut’s consolidated costs drop from ~$1,600/oz to below $1,375/oz, a significant improvement.
However, with Richard Young on board, I would imagine that the plan could be to divest one or two higher-cost assets and look at expanding production at Magino post-2026.
This would result in a slightly smaller producer but boasting costs more in line with the industry average and with more production coming from Tier-1 jurisdictions (Nevada, Ontario).
For now, it’s still early to speculate, but with ARNGF on track to report $0.28+ in cash flow per share in FY2024, the stock trades at less than 2.0x cash flow, which is far too cheap for a producer of its scale.
This is especially true given that construction is more than 90% complete at Magino, and we often see a re-rating in miners once they move out of a capex-heavy period and into a period where it’s generating significant free cash flow.
So, based on what I believe to be a conservative multiple of 3.0x and FY2024 cash flow per share estimates of $0.28, I see a fair value of $0.84 for its 18-month target price.
That said, when it comes to small-cap producers, I prefer a minimum 45% discount to fair value to justify starting new positions to ensure a meaningful margin of safety.
In the case of Argonaut, this would require a pullback below US$0.46 to place the stock in a low-risk buy zone. In summary, while I am bullish on the stock longer term, I am neutral short-term and waiting for a deeper pullback to add to my position.
Sandstorm Gold Royalties (SAND)
Sandstorm Gold Royalties (SAND) is a $1.6 billion company in the precious metals space. It earns most of its revenue from gold, silver, and copper, with ~90% of its revenue from gold and silver.
The company is unique because it is not a gold producer but a royalty/streaming company, offering superior diversification for investors relative to producers (which typically have fewer than eight producing assets).
These companies also boast higher margins, allowing them to command premium multiples relative to gold producers, with 15-35% operating margins in most cases.
For those unfamiliar with the business model, royalty/streaming companies finance developers and producers in the gold and silver space, giving them capital upfront to build or expand their assets. In exchange, Sandstorm receives either a royalty on the asset over its mine life or a stream on the asset, meaning that Sandstorm has a right to buy a percentage of metal produced at a fixed cost well below the current spot price of gold/silver.
The result is that Sandstorm reported 70% – 80% gross margins over the past five years, with operating margins averaging 34% the past three years despite its relatively small scale (~95,000 gold-equivalent ounces in FY2023).
While there are several royalty/streaming companies to choose from, Sandstorm differentiates itself from its peers, given that it has one of the highest-growth rates sector-wide. This is based on its soft guidance to grow annual attributable production from 82,000 ounces in FY2022 to ~140,000 ounces in FY2025, translating to a 70% growth rate.
If successful, annual cash flow would soar from ~$110 million to ~$190 million, translating to cash flow per share of $0.63 based on ~300 million shares.
Using what I believe to be a conservative multiple of 18x cash flow (given that it is more diversified than most of its peers but has some production coming from less favorable jurisdictions), I see a long-term fair value for Sandstorm of $11.30 (110% upside from current levels).
However, this assumes metals prices remain below $1,850/oz gold and $24.00/oz silver in FY2025.
In a more bullish scenario for metals prices, SAND could generate $0.75 per share in cash in FY2025, translating to a fair value of $13.50.
So, why has the stock underperformed its peers?
With a weaker balance sheet than its peer group ($300+ million in net debt) and the fact that the company just diluted shareholders in its financing in Q4 of last year, the stock is out of favor, and understandably so after the financing came as a major surprise.

Meanwhile, given its higher debt position, Sandstorm may struggle to add new royalties/streams this year because it is laser-focused on reducing its debt load.
However, if we look ahead to 2024/2025, there’s a lot to like here, and Sandstorm is trading at a significant discount to its historical multiple. To summarize, I would view any further weakness in the stock below $5.10 as a buying opportunity.
Several names in the gold sector are now closer to fairly valued after a ~50% rally in the GDX.
However, Sandstorm and Argonaut are two names that continue to trade at attractive valuations with large safety margins.
While I don’t see either stock as a buy this second, I do see them as two of the more undervalued names sector-wide, and I would view pullbacks below $5.10 (Sandstorm) and $0.46 (Argonaut) as buying opportunities.
Disclosure: I am long SAND, ARNGF
Taylor DartINO.com Contributor
Disclaimer: This article is the opinion of the contributor themselves. Taylor Dart is not a Registered Investment Advisor or Financial Planner. This writing is for informational purposes only. It does not constitute an offer to sell, a solicitation to buy, or a recommendation regarding any securities transaction. The information contained in this writing should not be construed as financial or investment advice on any subject matter. Taylor Dart expressly disclaims all liability in respect to actions taken based on any or all of the information in this writing. Given the volatility in the precious metals sector, position sizing is critical, so when buying small-cap precious metals stocks, position sizes should be limited to 5% or less of one’s portfolio.

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Why This Oil Major Remains a Buy

Investors Alley / By Magnifi Communities

The world’s major oil companies have all reported record annual profits. And, despite what Wall Street is telling you, these are still stocks you want to have in your portfolio for both growth and dividends.

One oil major in particular reported some great earnings on February 2, making it a buy. Let’s take a look…

The company in question is Shell PLC (SHEL).

Europe’s largest oil and gas company said that adjusted earnings had more than doubled, to $39.9 billion—smashing the previous record of $28.4 billion set in 2008. That was the highest profits figure in Shell’s 115-year history!

And Shell’s adjusted earnings of $9.8 billion in the final quarter of the year—its second-highest quarterly figure ever—far exceeds average analyst estimates of $8 billion.

Almost two-thirds of Shell’s profits in the quarter came from its natural gas business, which includes the world’s largest liquefied natural gas (LNG) trading operation. That division generated adjusted earnings of $6 billion as Shell sold 16.8 million tons of LNG, up from 15.7 million tons in the third quarter.

The company’s net earnings in 2022 were more than 70% higher than just eight years earlier in 2014. One of the biggest differences between now and then was in the refining division, where refining margins were five times as high!

The other difference was pretty obvious: the normally quiet European natural gas market suffered massive shortages. The Ukraine war meant European gas prices averaged $40 per million BTU in 2022, almost four times what they were in 2014!

Shell’s Big Bet on Natural Gas

Shell’s latest results show that its big bet on natural gas—the $54 billion purchase of BG Group in 2015—was a wise move. At the time, Wall Street hated the move and punished the stock.

Most of the numbers below come from an article by The Financial Times’ Lex team:

Income at Shell’s midstream “integrated gas” division has grown by half since 2014—to $16.1 billion—and now accounts for 40% of Shell’s overall result.

Since 2014, the company has also gotten a lot more out of less. Shell’s cost per barrel of oil in 2022 was about half what it was in 2014, according to Bernstein analysts. That, together with those higher prices for natural gas, means net income from upstream operations was about 2.5 times that in 2014—despite 7% fewer barrels being produced.

Those higher natural gas prices and stronger refining margins helped push Shell’s return on capital employed (ROCE) to about 16%, more than double 2014’s number.

Shell Payouts

Now, let’s look at how Shell has treated its shareholders…

Shell distributed $26 billion to shareholders in 2022—more than 35% of operating cash flow. This included $18 billion in share buybacks. The company said it would buy back a further $4 billion in stock in the first four months of 2023.

The company also boosted its cash dividend by 15% in the fourth quarter, the fifth increase since it delivered a more than 60% cut in the wake of the coronavirus pandemic.

Overall, management is far exceeding its minimum targets of 4% annual dividend growth and shareholder distribution of 20% to 30% of operating cash flow.

Shell Remains Cheap

During the past five years Shell has reduced unit development cost and operating cost by 51% and 26%, respectively. Its goal is to reduce development costs by a further 10% and operating costs by 20% to 30%.

Shell has also reduced and focused investment on the highest quality assets. According to Shell, its slate of new projects will be return accretive with anticipated average returns of 20% to 25%, an average break-even price of $30 per barrel, and an average payback period of seven years. Based on Rystad data, Morningstar estimates Shell’s project queue has an average break-even price of just $42 per barrel, well below the current oil price.

Despite this, Shell remains an unloved, but high-return, investment. Even after the more than 25% share price increase seen in 2022, the oil and gas behemoth remains lowly rated by Wall Street. Shell sits at an EV/EBITDA ratios of 3. EV/EBITDA is a ratio that compares a company’s Enterprise Value (EV) to its earnings before interest, taxes, depreciation, and amortization (EBITDA). The EV/EBITDA ratio is commonly used as a valuation metric to compare the relative value of different businesses.

I believe Shell stands to benefit more than its peers from the rise in global natural gas demand and likely strong prices for LNG over the next decade as it becomes an integral part of the energy landscape.

With regard to dividends, I would not be surprised to see an increase in the long-term return guidance (as a percent of cash flow) at Shell’s June strategic update. The current yield is 4.42%.

The stock is a buy anywhere in the $55 to $60 range.

Why This Oil Major Remains a Buy Read More »

Up 66%, Is SOFI Stock Now a Buy?

INO.com / By Magnifi Communities

Personal finance fintech company SoFi Technologies, Inc. (SOFI) reported solid fourth-quarter results.
Its loss per share came below analyst estimates, and its revenue beat the consensus estimate by 4.1%. The company’s adjusted net revenue in the fourth quarter came in 4.2% above its guidance range high of $425 million, and its adjusted EBITDA came $23 million above the high-end of its guidance.
SOFI’s CEO Anthony Noto said, “Record revenue across all three of our business segments – Lending, Technology Platform, and Financial. Our continued strong growth and significant improvement in GAAP net income margin position us very well in 2023 for another year of significant revenue and EBITDA growth and for reaching GAAP net income profitability in the fourth quarter.”
SOFI’s solid results could be attributed to its total deposits, which rose 46% sequentially and more than 700% in 2022 to $7.34 billion. The company benefited from the Fed’s aggressive interest rate hikes leading to its rise in net interest income.

The company added 480K members in the fourth quarter. Its total members came in at 5.22 million, rising 51% year-over-year. It added 695K new products in the fourth quarter, bringing total products to 7.89 million in 2022, increasing 53% year-over-year.
Noto said, “Our strong momentum in member and product adds, and the momentum in products added from cross-buy, reflects the benefits of our broad product suite and Financial Services Productivity Loop (FSPL) strategy.”
“Total deposits at SoFi Bank grew 46% sequentially during the fourth quarter to $7.30 billion at year-end, and 88% of SoFi Money deposits are from direct deposit members. We continued to see nearly half of newly funded SoFi Money accounts set up direct deposit by day 30, and average spend in the fourth quarter rose 25% versus the third quarter. As a result of this growth in high-quality deposits, we are benefiting from a lower cost of funding for our loans,” he added.
For the first quarter of fiscal 2023, the company guided its adjusted net revenue between $430 million to $440 million.
In addition, it expects its adjusted EBITDA to come between $40 million to $45 million. In the fourth quarter of fiscal 2023, the company expects positive GAAP net income and a 20% incremental GAAP net income margin for the full year.
For fiscal 2023, SOFI expects its adjusted net revenue to be between $1.925 billion and $2 billion. Also, the company expects its adjusted EBITDA to come between $260 million to $280 million.
SOFI’s stock has gained 65.8% in price over the past month and 39.2% over the past three months to close the last trading session at $7.46.
Here’s what could influence SOFI’s performance in the upcoming months:
Mixed Financials
SOFI’s adjusted net revenue increased 58.4% year-over-year to $443.42 million for the fourth quarter ended December 31, 2022. The company’s adjusted EBITDA rose significantly from the prior-year quarter to $70.06 million.
Its net loss narrowed 64% year-over-year to $40 million. In addition, its loss per share narrowed 67% year-over-year to $0.05.
Mixed Analyst Estimates
Analysts expect SOFI’s EPS for fiscal 2023 to be negative. Its EPS is expected to be positive for fiscal 2024. Its revenue for fiscal 2023 and 2024 is expected to increase 27.5% and 24.1% year-over-year to $1.96 billion and $2.44 billion, respectively. It surpassed Street EPS estimates in each of the trailing four quarters.
Stretched Valuation
In terms of forward P/S, SOFI’s 3.55x is 35.2% higher than the 2.62x industry average. Likewise, its 1.36x forward P/B is 14.7% higher than the 1.19x industry average.
Mixed Profitability
SOFI’s trailing-12-month net income margin of negative 21.09% compares to the 27.51% industry average. Its trailing-12-month Return on Total Assets of negative 1.69% compares to the 1.19% industry average.
On the other hand, its 6.83% trailing-12-month Capex/Sales is 312.6% higher than the industry average of 1.66%. In addition, its 79.38% trailing-12-month gross profit margin is 27.5% higher than the industry average of 62.26% industry average.
Technical Indicators Show Promise
According to MarketClub’s Trade Triangles, the long-term and intermediate-term trends for SOFI have been UP since January 30, 2023, and January 9, 2023, respectively. Its short-term trend has been UP since December 29, 2022.
Source: MarketClub
The Trade Triangles are our proprietary indicators, comprised of weighted factors that include (but are not necessarily limited to) price change, percentage change, moving averages, and new highs/lows. The Trade Triangles point in the direction of short-term, intermediate, and long-term trends, looking for periods of alignment and, therefore, intense swings in price.

In terms of the Chart Analysis Score, another MarketClub proprietary tool, SOFI, scored +90 on a scale from -100 (strong downtrend) to +100 (strong uptrend), indicating that the uptrend will likely continue. While SOFI shows signs of intraday weakness, it remains in the confines of a bullish trend. Traders should use caution and utilize a stop order.

The Chart Analysis Score measures trend strength and direction based on five different timing thresholds. This tool considers intraday price action; new daily, weekly, and monthly highs and lows; and moving averages.
Click here to see the latest Score and Signals for SOFI.
What’s Next for SoFi Technologies, Inc. (SOFI)?
Remember, the markets move fast and things may quickly change for this stock. Our MarketClub members have access to entry and exit signals so they’ll know when the trend starts to reverse.
Join MarketClub now to see the latest signals and scores, get alerts, and read member-exclusive analysis for over 350K stocks, futures, ETFs, forex pairs and mutual funds.
Start Your MarketClub Trial
Best,The MarketClub Team[email protected]

Up 66%, Is SOFI Stock Now a Buy? Read More »

3 Stable Stocks That Could Help Pay Your Bills in 2023

StockNews.com / By Magnifi Communities

After a miserable 2022, stocks have surged significantly since the start of this year as investors believe that inflation will continue to cool and the economy could avoid a recession. The Nasdaq Composite is up nearly 13% this year after posting its best January in over 20 years. After seeing progress in its fierce battle

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2 Dividend Stocks to Buy in 2023 for a Stable Income Stream

StockNews.com / By Magnifi Communities

The Federal Reserve raised its benchmark interest rate by a quarter percentage point recently, which indicated that it is seeing progress in its battle with inflation. This came after a series of outsized rate increases over the last year. While inflation is cooling, it is still far from the Fed’s target. In addition, the January

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What Is A Buyback? 1 Company Buying Back Its Stock in 2023

INO.com / By Magnifi Communities

A business with excess cash on its books can return value to shareholders in various ways. One of them is distributing the surplus among shareholders as dividends. However, they are more tax-efficient ways to reward existing shareholders with delayed gratification.
A business can choose to reinvest its earnings into its own business or acquire other businesses to upgrade or expand its operations organically or inorganically to increase its future earnings and consequentially increase the intrinsic value of each of its outstanding shares.
Alternatively, the business may choose to decrease the number of outstanding shares, making each share worth a greater percentage of the corporation. All else being equal, this increases the earnings attributable to each share almost immediately. This method of allocating excess capital is called a buyback.
Buybacks are initiated through tender offers or open market transactions when the management of an organization feels that its shares are undervalued. In addition to signaling financial health and increased confidence in their own prospects, businesses also repurchase their own shares to reduce supply and dilution by shrinking the float to prevent other shareholders from taking a controlling stake.
In a nutshell, a buyback is a way for a business to get its skin deeper in the game with the hope of rewarding investors who choose to keep supporting it.
Can Meta Platforms Be a Good Investment Given Its Buyback Program?
On February 1, Meta Platforms, Inc. (META) announced that it had repurchased $6.91 billion and $27.93 billion of its Class A common stock in the fourth quarter and full year of 2022, respectively.
It also announced a $40 billion increase in its share repurchase authorization, in addition to the $10.87 billion available and authorized for repurchases as of December 31, 2022.
As the parent company of world-renowned social networking platforms, such as Facebook and Instagram, META builds technologies that help people find communities and grow businesses through mobile devices, personal computers, virtual reality (VR) headsets, wearables, and in-home devices. The company operates through two segments: Family of Apps (FoA) and Reality Labs (RL).
According to META founder and CEO Mark Zuckerberg, 2023 is the ‘Year of Efficiency’ for the company. To this end, the business has lightened its headcount by about 11,000 while pivoting towards a next-generation data center design, including the cancellation of multiple data center projects. It has also sought to consolidate its capital structure and allocate more efficiently by doubling its share repurchase.
Driven by positive sentiments, the stock has gained 46.7% over the past month to close the last trading session at $186.06.
META is trading above its 50-day and 200-day moving averages of $128.44 and $151.81, respectively, indicating an uptrend.
Here is what may help the stock maintain its performance in the near term.
Solid Track Record
Over the past three years, META’s revenue has exhibited an 18.2% CAGR, while its EBITDA has grown at a 6.8% CAGR.
During the same period, the company has increased its net income at 7.9% CAGR, while its EPS has grown at a 10.1% CAGR due to its expanded buyback program, which began in 2017.
Robust Financials
During the fourth quarter and entire fiscal year, which ended December 31, 2022, META’s revenue came in at $32.17 billion and $116.61 billion, representing 1.5% and 3.9% year-over-year increases, respectively, on a constant currency basis.
The company’s income from operations for the quarter came in at $6.40 billion, while its net income came in at $4.65 million, or $1.76 per share.
META’s total assets stood at $185.73 billion as of December 31, 2022, compared to $165.99 billion as of December 31, 2021. Daily Active People (DAP) and Monthly Active People (MAP) across its family increased 5% year-over-year to 2.96 billion on average for December 2022 and 3.74 billion as of December 31, 2022.
Premium Valuation
Given its increasing usage statistics and a renewed focus on consolidation and efficiency, META is currently commanding a premium compared to its peers. In terms of forward P/E, META is currently trading at 20.04x compared to the industry average of 17.47x.
Moreover, META’s forward EV/Sales and Price/Sales multiples of 3.84 and 3.95 are also higher than the respective industry averages of 2.06 and 1.36.
Favorable Analyst Estimates for Next Year
META’s steady growth and increasing efficiency have led analysts to expect its revenue and EPS to increase 5% to $122.40 billion and $9.02, respectively, for the fiscal year ending December 31, 2023.
Revenue and EPS are expected to increase 11.6% and 23.6% during the next fiscal year to $136.65 and $11.15, respectively.
Technical Indicators Look Promising
MarketClub’s Trade Triangles show that META has been trending UP for each of the three time horizons. The long-term trend has been UP since January 23, 2023, while the intermediate-term and short-term trends have been UP since December 1, 2022, and January 20, 2023, respectively.
Source: MarketClub
The Trade Triangles are our proprietary indicators, comprised of weighted factors that include (but are not necessarily limited to) price change, percentage change, moving averages, and new highs/lows. The Trade Triangles point in the direction of short-term, intermediate, and long-term trends, looking for periods of alignment and, therefore, strong swings in price.
In terms of the Chart Analysis Score, another MarketClub proprietary tool, META scored +90 on a scale from -100 (strong downtrend) to +100 (strong uptrend), indicating that the uptrend will likely continue. While META is showing intraday weakness, it remains in the confines of a bullish trend. Traders should use caution and utilize a stop order.

The Chart Analysis Score measures trend strength and direction based on five different timing thresholds. This tool takes into account intraday price action, new daily, weekly, and monthly highs and lows, and moving averages.
Click here to see the latest Score and Signals for META.
What’s Next for Meta Platforms, Inc. (META)?
Remember, the markets move fast and things may quickly change for this stock. Our MarketClub members have access to entry and exit signals so they’ll know when the trend starts to reverse.
Join MarketClub now to see the latest signals and scores, get alerts, and read member-exclusive analysis for over 350K stocks, futures, ETFs, forex pairs and mutual funds.
Start Your MarketClub Trial
Best,The MarketClub Team[email protected]

What Is A Buyback? 1 Company Buying Back Its Stock in 2023 Read More »

Will PTON’s Positive Momentum Continue?

Investors Alley / By Magnifi Communities

Embattled gym equipment company Peloton (PTON) has reversed course in 2023. The stock is up a whopping 114% for the year. A recent block of PTON options suggest there could be another 30% of upside in the next month or so. An out-of-the-money calendar spread traded last week that is maximized if PTON ends up

Will PTON’s Positive Momentum Continue? Read More »

This Is the Only Place to Buy Stocks Right Now

Investors Alley / By Magnifi Communities

The Federal Reserve is the swing factor in the current market. The tug-of-war between what the Fed officials have said and what the market thinks the Fed really plans to do is ongoing and makes for a problematic investing and trading environment.

Even our favorite special situations landscape is pretty quiet. Insiders are sitting still, activists are apparently on vacation, and even pending takeovers and announced strategic reviews are fairly priced right now.

Momentum is starting to fade, so we are not enthusiastic about adding to momentum trades, and there is no way I am suggesting we put on deep-value trades after an 8% one-month move in the S&P 500.

But there are two areas where I’m seeing plenty of buying opportunities…

It is a good time to avoid making new investments outside of select small banks and closed-end funds like those I discuss in my Bank Takeover Letter, The 20% Letter, and Underground Income – see below for more on that.

But at a time when it is quiet in the market and we are waiting for Fed- or earnings-related news to create new opportunities, our best use of time is probably to talk about nuclear energy.

In case you are new to the party, I am wildly bullish on the long-term future of nuclear energy and uranium.

I know all the horror stories. I watched Chernobyl on HBO. I watched the flooding and destruction of the Fukushima reactors with the same horror as everyone else. I lived in Baltimore, a mere 80 miles from Three Mile Island, when that fiasco occurred.

The headlines make for some scary reading.

But outside of the headlines, the truth is that nuclear energy is one of the planet’s safest, greenest sources of energy.

Best of all, unlike many renewable energy sources, nuclear energy is available on a 24/7 basis. Now that everyone who listens to the gospel of green and was not driven away by my love of fossil fuels has finally left, the rest of us can look at the reality of nuclear energy.

The war in Ukraine has caused many European governments to reconsider their stance on nuclear energy. Now that our friend Vladimir Putin turned off the gas spigot, windmills and solar panels cannot meet demand—and so Europe has ended up burning coal and wood.

Several nations, including Japan, Belgium, and South Korea, have already changed their outlook on using nuclear energy. And the United States and the United Kingdom have decided that cutting down existing points was not such a good idea after all.

At the same time, the war has interrupted the global uranium supply chain, causing some shortages and driving up prices, creating wider margins for uranium miners.

For the first time, financial buyers such as hedge funds and exchange-traded funds have gotten involved, purchasing significant amounts of uranium. These buyers have no intention of selling until they make many multiples of what they paid.

There are two ways to make money off uranium. The first is to buy the miners—the uranium mining business should be very good for a long time.

Which miners should we buy?

The answer is all of them, so I am going to suggest something I rarely advise. To cash in on the coming boom for uranium miners, your best bet is to buy the Sprott Uranium Miners ETF (URNM).

This exchange-traded fund owns the largest uranium miners in the world. These companies will be the primary beneficiaries of surging uranium demand and soaring profit margins.

Using an ETF allows you to buy most of the global uranium mining industry for modest amounts of cash.

You should also buy the Sprott Physical Uranium Trust, which trades over the counter in the United States with the ticker SRUUF. The trust invests in physical, yellowcake uranium, a form created early in the mining cycle, before fuel fabrication.

The trust currently holds almost 60 million pounds of yellow cake uranium, worth nearly $3 billion. One uranium fuel pellet is the size of a gummy bear and produces as much energy as three barrels of oil, a ton of coal, or 17,000 cubic feet of natural gas.

The green energy advocates will tell you that spent nuclear fuel is a serious hazard and threat to the whole world. But, given that the United States has been transporting and storing spent fuel rods for more than 50 years with no accidents, that would appear to be an exaggeration.

Spent nuclear fuels can also be recycled to produce new fuels and byproducts. For example, while the United States has yet to start recycling, France has been recycling spent fuel since the 1960s and has recovered enough fuel to run its nuclear industry for 14 years.

Nuclear energy has to be part of the global energy plan, or we will go backward in reducing carbon emissions.

We can earn huge profits by owning the companies and fuel that will help drive a cleaner nuclear energy future.
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