INO.com

While the Nasdaq 100 (QQQ) has continued its outperformance on the back of a strong start to the Q1 Earnings Season for Big Tech, the real outperformer has been the Gold Miners Index (GDX).
Not only is the index outperforming the major market averages with a 17% return but it’s also outperforming the price of gold, a healthy sign that suggests a potential change in character after years of underperformance.
The recent strength can be attributed to the sharp rise in the gold price towards the psychological $2,000/oz level, resulting in significant margin recovery for gold producers after a tough year plagued with supply chain headwinds and inflationary pressures.
The good news regarding the recent rally in the Gold Miners Index is that momentum is to the upside and sharp pullbacks are likely to find buying support.

The bad news? With the index up over 50% from its Q3 2022 lows, some of the easy money has been made and a few miners are actually looking fully valued.
Fortunately, there are exceptions, and in this update we’ll look at two names that look reasonably valued and are likely to outperform given their relative value compared to peers.
Marathon Gold (MGDPF)
Marathon Gold (MGDPF) is a development-stage gold company based out of Newfoundland, Canada, with the company currently busy constructing its Valentine Gold Project.
The project is home to nearly 3.0 million ounces of gold reserves and the company plans to operate an open-pit mine consisting of three pits (Berry, Valentine, Leprechaun) with average annual production of 195,000 ounces of gold (first 12 years) at industry-leading all-in sustaining costs of $1,007/oz.
Based on the current schedule, Marathon is aiming to start producing gold by year-end 2024, and the project should boast ~48% margins and generate $120 million per annum in free cash flow at a $1,950/oz gold price.
Heading into 2022, Marathon Gold was near fully valued, trading at a market cap north of $600 million and being one of the few junior gold names bucking the sector-wide downtrend.
However, the stock has since slid by over 60% after reporting material cost increases to build its project, with updated costs coming in at $350 million.
This resulted in a funding shortfall and a significant equity raise and in order to address the funding gap, Marathon completed a significant financing which led to unplanned shareholder dilution.
Although this was certainly painful for existing investors and the underperformance has been frustrating, the stock has found itself trading at a market cap of barely $300 million with the project nearly fully financed and nearing 25% completion by summer.
This valuation of barely $100/oz gold reserves is a massive discount to the price paid in takeovers over the past two years despite a higher gold price and it’s made Marathon extremely undervalued on a price to net asset value basis and also a potential takeover target.
In summary, I see the stock as a steal below US$0.63, and I am continuing to build a position on weakness.
Royal Gold (RGLD)
Royal Gold (RGLD) is a precious metals royalty and streaming company with a $8.7 billion market cap and is the #3 name by size among its peer group.
For those unfamiliar with the precious metals sector, royalty/streaming companies offer low-risk exposure to gold and silver given that they allow an investor to get exposure to metals prices with diversification and with insulation from inflationary pressures on operating costs and capital costs.
This is made possible because royalty/streaming companies pay upfront to receive a portion of production over the life of a mine rather than operators which must continuously pay to operate mines and sustain these mines through equipment purchases, tailings expansion, community programs, and mine development/stripping.
Heading into Q2, Royal Gold was one of the better performers among its peers.
However, the company’s recently released 2023 guidance of 320,000 to 345,000 gold equivalent ounces [GEOs] was lighter than investors hoped, with Royal Gold finding itself over 9% from its recent highs despite a mild pullback in metals prices.

While the weaker guidance than expected is a little disappointing, it’s worth noting that Royal Gold has one of the best growth profiles in the sector among its peer group with several assets set to come online over the next few years and its silver stream at the Khoemacau Copper Mine is set to deliver significantly more ounces this year.
Plus, Royal Gold’s size compared to its two largest peers means that even mid-sized deals move the needle for the company so it isn’t having trouble growing and maintaining diversification like the two largest royalty/streaming companies.
Based on a current share price of $133.00, Royal Gold is not cheap enough yet, with it trading at ~21x FY2023 cash flow estimates and I believe the best time to buy the stock is when it’s trading below 18.0x cash flow earnings.
That said, it is one of the most attractively valued name among the top-3 royalty/streaming companies making it a name worth keeping a close eye on if we do see a deeper pullback in metals prices.
Hence, for investors looking for low-risk exposure to precious metals prices that don’t want to step into the riskier development space, I see RGLD as a solid buy-the-dip candidate at $116.00 or lower.
Disclosure: I am long MGDPF
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.

Editor’s Note: Our experts here at INO.com cover a lot of investing topics and great stocks every week. To help you make sense of it all, every Wednesday we’re going to pick one of those stocks and use Magnifi Personal to compare it with its peers or competitors. Here we go…

Demand is picking up again for the cruise industry, especially among the over-60 crowd. This demographic typically makes up a third of cruise passengers.
The Cruise Lines International Association (CLIA) expects the number of cruise passengers to reach 31.5 million this year, a 6% uplift on pre-pandemic levels, according to its annual forecast. And on a first-quarter earnings call last month, Josh Weinstein, CEO of Carnival Corporation (CCL), said bookings for the peak 2023 cruise season had been “phenomenal.”
Carnival, the world’s biggest cruise line operator, operates more than 90 ships, and reported customer deposits of $5.7 billion for the three months ending February 28 – well ahead of its previous first-quarter record of $4.9 billion in 2019. This meant it generated a positive cash flow from operations for the first time in almost three years!
The world’s second-biggest cruise line, Royal Caribbean (RCL), also said in February it was seeing “record-breaking” bookings, with all seven of the strongest weeks in the company’s history occurring since November 2022. The company, which operates 64 ships, expects its cash profit (EBITDA) in 2023 to exceed 2019 levels of around $3.3 billion, as it raises prices to reflect both higher demand and costs.
The industry expects the growth trend to continue.
More than half of the 71 ships currently on order are the mega-vessels capable of carrying more than 4,500 passengers, compared with just 12% of the active fleet. To fill that expanding capacity, the cruise industry will have to grow faster than other tourism sectors. But keep in mind that ship owners are retiring their older vessels, and the bigger ships are much more profitable in terms of accommodation, food, and service costs per passenger.
These bigger ships contain more family-focused attractions such as zip lines, water parks and more event venues, meaning there’s a lot more to do onboard. The days when the experiences were all at port and the cruise ship was just your transport between destinations are long gone.
So, we thought we’d do a comparison of these two cruise companies – CCL and RCL – over this past, very volatile, year. The quick and easy way to do this is to ask Magnifi Personal to run the comparison for us. It’s as simple as asking this investing AI to “Compare CCL to RCL.”
As you can see, RCL was the clear winner. It was a bit less volatile and had a stock price gain over three years versus a loss for CCL shareholders.

This is an example of a response using Magnifi Personal. This image is not a recommendation or individual advice. Please see bottom disclaimer for additional information, including INO.com’s relationship with Magnifi.
This is just a starting point, of course. Magnifi Personal can easily compare several stocks or ETFs on more criteria, such as dividend payments, turnover, volume, and so on.
You can do it, too. Get access to Magnifi Personal completely free-of-charge – just click here.
This ability to have an investing AI pore over reams of data for you in seconds and spit out an easy-to-understand comparison of two or more stocks is an invaluable tool in deciding where to invest next.
We highly recommend you try it out. Click here to see how.
Magnifi Personal makes research like this as simple as typing a question. You can easily do this yourself, or ask Magnifi Personal to add other measures to the comparison, including dividend, valuation metrics such as P/E or P/B ratios, gross margin, and more.
Just click here to see how to set up your Magnifi Personal account.

INO.com, a division of TIFIN Group LLC, is affiliated with Magnifi via common ownership. INO.com will receive cash compensation for referrals of clients who open accounts with Magnifi.
Magnifi LLC does not charge advisory fees or transaction fees for non-managed accounts. Clients who elect to have Magnifi LLC manage all or a portion of their account will be charged an advisory fee. Magnifi LLC receives compensation from product sponsors related to recommendations. Other fees and charges may apply.
Diversification does not guarantee a profit or protect against a loss in a declining market. It is a method used to help manage investment risk.
Mutual Funds and Exchange Traded Funds (ETFs) are sold by prospectus. Please consider the investment objectives, risks, charges, and expenses carefully before investing. The prospectus, which contains this and other information about the investment company, can be obtained from the Fund Company or your financial professional. Be sure to read the prospectus carefully before deciding whether to invest.

A year and a half before the election, and a little less than a year before the first primary, the Wall Street Journal is already proclaiming that “Another Biden-Trump Presidential Race in 2024 Looks More Likely.”
Doesn’t that get you excited?
It’s pretty sad that out of more than 260 million adults the best the two parties could come up with is the current president, octogenarian Joe Biden, and his predecessor, Donald Trump, who is 76.
And advanced age isn’t their only drawback: both are, shall we say, not very popular.
Yet only a few people, so far, seem to have the guts to stand up and challenge them—no serious Democrats so far and only a handful of Republicans. But it’s early yet, so let’s not lose hope that others will step into the ring.

As Winston Churchill is credited with saying, “Democracy is the worst form of government, except for all the others.”
There are good reasons why the best and brightest people shun politics and have no desire to be president. Politics played at that level is an ugly sport. Few smart and ambitious people want to put themselves or their families through that. It’s a lot more lucrative and less painful to be CEO of a large corporation than to sully your name in politics. It’s also a lot easier to look yourself in the mirror every morning.
If you are willing to mix it up and eventually succeed into the Oval Office, you often have to do things you may not be proud of. In the spirit of “compromise,” you often have to lie and make empty promises—or worse—in order to get a fraction of what you really wanted. So it’s understandable why the government often botches things—we never get the best people or the best policies, so problems just seem to fester and get worse.
Which brings me to my point and how it applies to the Federal Reserve. 
While ostensibly independent from the rest of the government, the Fed has no similar obstacles to making good policy.
You certainly can’t get to be Fed chair or some other senior position at the Fed without a little behind-the-scenes politicking either on your own or from influential friends and allies, but it’s not anywhere close to what you have to do to be president. And once you get there, while the Fed chair does need to rule by consensus and isn’t a dictator, he or she can exert their power and authority a lot easier than can the president of the United States, for the simple reason that they don’t have a constituency of voters they have to face every few years.
Members of the Fed’s Board of Governors aren’t “independent” to the same degree as Supreme Court justices, who can sit for life if they so choose. But Fed governors are, by design, insulated from politics, as they are appointed to 14-year terms.
Jerome Powell’s term as Fed chair doesn’t end until 2026 and his term as a Fed governor doesn’t expire until 2028. That’s pretty decent job security in Washington.
So, given that level of freedom and independence, why does the Fed — which employs hundreds of the (supposedly) smartest economists and financial minds in the country — make so many bad decisions and policy errors?
As we know, we’re currently living through the consequences of the Fed’s latest blunder. It failed to raise interest rates until long after the inflationary horse had left the barn and now seems poised to raise rates still further even though it appears that inflation has started to recede, even if that means the economy falls into recession and millions of people lose their jobs.

So what if a couple of big banks failed along the way as a result? That was as much about bad management as it was a direct result of the Fed’s foolish policy of keeping interest rates too high for too long.
So given the advantages it possesses, at least compared to the rest of the government, how does the Fed manage to do such a bad job?
In the coming weeks, President “No Compromise” Biden and the GOP-controlled House will do battle over increasing the federal debt ceiling with the country’s finances and legal obligations hanging in the balance.
It’s too bad such an important thing has to be in the hands of politicians. Yet, sadly, it’s hard to see that the Fed would do any better in solving the problem.
George YacikINO.com Contributor
Disclosure: This article is the opinion of the contributor themselves. The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. This contributor is not receiving compensation (other than from INO.com) for their opinion.

Gold price came very close to hitting the double barrier at $2,070-$2,100 of the black path target and the upper boundary of the bullish trend channel outlined earlier this month. The new 1-year top has been established at $2,063.
You were amazingly accurate this time as most of the votes were for the black path to lead the way. The market has since reversed to the downside, raising the question of whether it was a hard top or a glass ceiling.
To answer this question, let me show you an updated chart below.
Source: TradingView
The price has slid down to the pink mid-channel support within the black bullish trend channel.

In the RSI sub-chart, we can clearly spot a bearish divergence as the falling peaks didn’t confirm the new top in the price chart. This has been playing out, pushing the price down. The indicator’s reading has reached the key support of 50, just like the price.
Let us watch how the price would react at this double edge of the mid-channel and the RSI’s support. The price still could bounce to the upside and challenge the recent top as well as the upside of the trend.
The bearish signal would come on the breakdown. In this case, the black path would be confirmed and the top of $2,063 would act as a peak of the first large move to the upside.

 Loading …
In the following chart I will zoom out and share a bigger picture on the weekly time frame.
Source: TradingView
This could be an eye-opening chart with three major scenarios. Sometimes it is worth to zoom out of short time frames and squeeze the chart to see a bigger map that appears.
The gold price chart is showing a potential Triple Top pattern, which poses a major risk for the price. The pattern is formed by three peaks in the same area between $2,000 and $2,100.
If this pattern is confirmed, it could be unpleasant for gold investors as the price would be expected to retest the valley of 2018 at $1,167, which is where the previous major bullish move had started (red arrow).

It seems that the black path may have been the preferred option before taking a broader view of the chart.
However, upon examination of the chart, it appears that the current top may just be the first move up, which has been retraced within a middle-sized consolidation. It is anticipated that after completion of the consolidation, another move up could potentially reach the $2,200 area.
The green path suggests that the zigzags between $2,100 and $1,600 represent a large consolidation, but the final move down to retest the green box has not yet occurred for completion. Once that happens, a large upside move of greater magnitude could potentially emerge, reaching the $2,500 area.

 Loading …
Intelligent trades!
Aibek BurabayevINO.com Contributor
Disclosure: This contributor has no positions in any stocks mentioned in this article. This article is the opinion of the contributor themselves. The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. This contributor is not receiving compensation (other than from INO.com) for their opinion.

The United Nations and other allied states around the world have been supporting Ukraine with military supplies since the very early days of the war. With the war in Europe still raging more than a year after it began, allied munitions stockpiles and military supplies are starting to get thin.
But, at some point, these countries’ reserves will reach a depleted level they are no longer comfortable with and be forced to restock. Let’s be honest; that point has already come and gone.
So today, countries in Europe and America are not only still giving Ukranie military aid, but also replacing their arms.
But something similar is also occurring in Asia, as China continues with aggressive talk pertaining to Taiwan. Furthermore, China has been heavily spending on its own military and set its defense spending growth at 7.2% in 2023, in line with where it was in 2022.

Even here in the U.S., the projected 2024 budget for defense spending came in at $842 billion, or $26 billion higher than where it was in 2023 and more than $100 billion higher than in 2022.
Even if the war weren’t taking place in Europe today, there would likely be an arms race around the world, and many believe it will only get worse since geopolitical tensions are still brewing in Asia.
So, how can you play this arms race?
Buy Defense and Aerospace Exchange Traded Funds and relax.
Not sure which ones to buy? Let’s take a look at a few.
The first ETF I would look at is the iShares U.S. Aerospace & Defense ETF (ITA).
ITA is the largest Defense and Aerospace ETF, with just over $6 billion in assets under management. ITA also has a reasonable expense ratio at 0.39% and has had a solid performance over the last few years. ITA is up 4.32% year-to-date but more than 14.9% annualized over the previous three years. ITA also has 100% of its assets invested in U.S. companies and has 37 holdings.
The next ETF I would look at is the Invesco Aerospace & Defense ETF (PPA).
PPA is the second largest defense ETF by assets under management with $1.9 billion. PPA’s expense ratio is a little higher at 0.61%. PPA also has a small percentage of its holdings from outside the U.S. PPA has also performed well year-to-date with a gain of 4.6%, and it is up 7.79% annualized over the last five years and 15% annualized over the previous ten years.
Next, we have the SPDR S&P Aerospace & Defense ETF (XAR) with $1.5 billion in assets is slightly smaller than PPA.
XAR has 34 holdings, all of which are based in the U.S. and has the lowest expense ratio yet at just 0.35%. XAR’s performance is also about the same as PPA and ITA, so don’t tell yourself the lower fee means worse performance. Out of the vanilla Aerospace and Defense ETFs, XAR is probably the best, simply because it is the cheapest.
The other two ETFs I would look at are the ARK Space Exploration & Innovation ETF (ARKX) and the leveraged Direxion Daily Aerospace & Defense Bull 3X Shares ETF (DFEN).

Cathy Wood led ARKX ETF combined defense, aerospace and space exploration stocks together since so many have a lot in common or sell products in two or even all three industries. However, the ARKX fund charges 0.70% expense ratio and doesn’t have the best performance during its short history.
The DFERN fund isn’t any less risky since it is three times leveraged ETF. DFEN tracks the DJ US Select Aerospace and Defense index but will move three times the magnitude. Furthermore, DFEN charges an 0.97% expense ratio and should only be held daily. DFEN is up 9.54% year-to-date but down 16% annualized over the last five years.
Unfortunately, this is our world, where war rages, and arms races are never-ending.
But since this is where we are, you may want to make money on it, and the above ETFs are a few ways you can do so.
Matt ThalmanINO.com ContributorFollow me on Twitter @mthalman5513
Disclosure: This contributor did not hold a position in any investment mentioned above at the time this blog post was published. This article is the opinion of the contributor themselves. The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. This contributor is not receiving compensation (other than from INO.com) for their opinion.

It’s been a mixed year thus far for the Restaurant industry group, with several quick-service names rallying near all-time highs while casual dining names have struggled to stay in positive territory for the year.
The underperformance of the latter group can be attributed to weaker traffic trends in the casual dining space relative to quick-service.
This is not surprising given that we are seeing a pullback in spending from some consumers and quick-service is a trade-down option relative to casual dining, with consumers able to treat themselves with convenience with pizzas, burgers, and fries without breaking the bank at a casual dining restaurant where average checks are closer to $20.00.
However, while we’ve seen Yum Brands (YUM) and McDonald’s (MCD) continue to make new highs with both up 15% and 25% from their pre-COVID-19 highs, a couple of names remain well below their all-time highs and continue to trade at attractive valuations.

This is despite these two companies having iconic brands similar to McDonald’s, and KFC, Taco Bell, and Pizza Hut (Yum Brands), and despite them having some of the better growth profiles sector-wide.
In this update, we’ll dig into these two companies and highlight why they could be outperformers after a period of underperformance in Dominos Pizza’s (DPZ) case, and years of underperformance in the case of Restaurant Brands International (QSR).
Restaurant Brands International (QSR)
Restaurant Brands International is a $21.2 billion franchisor in the Restaurant industry group with four iconic brands under its umbrella: Burger King, Popeye’s Chicken, Firehouse Subs, and Tim Hortons.
The three latter brands were acquired by Restaurant Brands International over the past decade and they currently make up roughly one-third of its system-wide stores which are spread across over 100 countries.
The largest of its brands is Burger King with ~19,000 restaurants, with Tim Hortons just behind at ~5,600 restaurants, Popeye’s Chicken having ~4,000 restaurants, and Firehouse Subs, the smallest brand, having roughly 1,200 restaurants and operating solely in North America.
Digging into the company’s FY2022 results, Restaurant Brands International reported 12.9% system-wide sales growth to $38.7 billion, which was driven by a 4.4% increase in its consolidated store count and ~8.5% growth in same-store sales.
This translated to annual revenue of $6.51 billion (+14% growth year-over-year) and annual EPS of $3.13, a 12% increase year-over-year. The latter was helped by opportunistic share buybacks, with RBI returning over $1.3 billion in capital to shareholders, or roughly 5% of its total market cap.
However, the major news was that Joshua Kobza has been appointed the new CEO, while Patrick Doyle has replaced Jose Cil as Executive Chairman of Restaurant Brands International, a significant shake-up that is overdue for the company.
For those unfamiliar, Patrick Doyle was transformational for the Domino’s Pizza brand, with the stock increasing over 1500% under his tenure and massively outperforming its peer group. And while 3G Capital is an investment firm known for cost-cutting, this was the wrong approach for a Burger King brand that needed investment to revitalize the brand that has been losing market share to McDonald’s.
Therefore, I see this new plan of re-investment (“Reclaim The Flame”) under management with significant experience in the sector and a strong track record as a huge upgrade for Restaurant Brands International, and I would expect better results from Burger King going forward which has unfortunately overshadowed the strong growth we’ve seen at its three smaller brands.
So, why buy a turnaround story like Restaurant Brands International?
Generally, I prefer to buy the leaders in a sector vs. turnaround stories given that turnaround stories are in some cases lower quality and can take a while to get out of the proverbial penalty box and start outperforming.
However, and in the case of Restaurant Brands International, the ingredients are in place for a successful turnaround (new management, reinvestment in its weaker brands, strong unit growth at smaller brands), and the valuation is right, with Restaurant Brands International trading at just ~17.4x FY2025 earnings estimates ($3.96) vs. McDonald’s at ~23.0x FY2025 earnings and ~21.0x, respectively.
I don’t see any reason that Restaurant Brands International should trade at this large of a discount, especially when it has the best dividend in the group and the highest growth rate, making it even more attractive in a market where it’s hard to find growing dividend yields above 3.0% with growth stocks.
In fact, based on what I believe to be a fair multiple of 24.5x earnings, I see a fair value (two-year target price) for Restaurant Brands International of $97.00 per share, pointing to a near 50% total return when including dividends.
Plus, it’s worth noting that Chairman Patrick Doyle has tens of millions of reasons to execute successfully on this turnaround, with a significant compensation tied to performance if the share price averages at least a 10% compound annualized return over five years.
(Source: TC2000.com)
Finally, if we look at the stock from a technical standpoint, QSR is testing key resistance at the $69.00 level which dates all the way back to 2017 despite this being a much larger brand with the addition of Popeye’s Chicken and Firehouse Subs in the period and a stronger management team at the helm.
This significant underperformance suggests that if QSR can breakout we could see it play significant catch up, with a quarterly breakout above $69.00 targeting a move to $92.00 as the first major target.
So, with undervaluation relative to peers, a turnaround story with a lot of promise, and a massive base having been built that is targeting much higher prices on a successful breakout, I see QSR as one of the best buy-the-dip candidates in the market today, and I would view pullbacks below $65.50 as buying opportunities.
Dominos Pizza’s (DPZ)
Dominos Pizza needs little introduction as the world’s largest pizza chain with nearly 7,000 restaurants in the United States alone, ~20,000 restaurants in over 90 markets, and global sales of nearly $18.0 billion.
The company briefly traded at a market cap of ~$20.0 billion at its peak in Q4 2021, but trades at a market cap of just $11.4 billion today based on ~35.4 million shares outstanding.
And while the significant decline in the stock over the past year from a high of $565.00 (~45% correction) has unnerved many investors that didn’t take profits after its incredible run off its COVID-19 lows (~90% gain in 20 months), I don’t see any damage to the long-term picture, and see this correction being more to do with the stock getting ahead of itself at its Q4 2021 highs.
Dominos Pizza released its 2022 results in late February, reporting global retail sales up 4% year-over-year, and 5.2% in Q4 2022. This was below estimates and resulted in a decline in annual EPS when factoring in inflationary pressures, with annual EPS coming in at $12.53 vs. $13.60 in FY2021.
Like Restaurant Brands, Dominos is primarily a franchisor model and although the increase in the cost of its market basket and supply chain headwinds hurt earnings, the impact was minimal given that its company-owned restaurants make up just 2% of its system (402 restaurants).
And while the company reported solid free cash flow generation (~$390 million) and saw 5% unit growth last year, its guidance and earnings performance was a disappointment.
As noted above, the 8% decline in annual EPS took the market by surprise after seven years of consecutive annual EPS growth, and the updated unit growth outlook of 5-7% vs. 6-8% spooked the market a little, as did the updated outlook of 4-8% global retail sales growth (two to three year outlook), which was down from 6-10% previously.
That said, the stock has been punished accordingly, and this outlook for weaker growth over the next few years looks priced into the stock already.
I see this as especially true given that we continue to be in a difficult economic environment and pizza and quick-service are typically the winners from a traffic standpoint when consumers decide to be more judicious with their spending.
So, what’s a fair value for the stock?
Dominos has historically traded at ~32.0x earnings yet has found itself trading at just ~19.1x FY2025 earnings estimates and ~21.7x FY2024 earnings estimates which is a massive discount to its historical multiple.
One could argue that a lower multiple is justified given that annual EPS is expected to decelerate from its previous growth rate of 14-18%.
That said, even if we use a fair multiple of 28.0x earnings and FY2024 earnings estimates of $15.02, I see a fair value for the stock of $420.60. This points to a 30% upside from current levels or closer to 32% on a total return basis which is quite attractive for a more defensive name that has historically outperformed in recessionary periods.
(Source: TC2000.com)
Lastly, if we look at the technical picture, Dominos Pizza is re-testing a multi-year prior resistance level and this is often an area where stocks will find support.

So, not only is the stock trading at a deep discount to its historical multiple and its large-cap peer group but it’s at a pivotal area from a technical standpoint where I would expect buyers to show up.
So, if DPZ were to see further weakness below $314.00, I would view this as a buying opportunity.
There are several names on the sale rack in the restaurant space after the underperformance year-to-date, but not all names are created equal, and some names are cheap for a reason.
However, in the case of QSR and DPZ, I see these as top-5 names in the industry group from a quality and growth standpoint and given their underperformance, they’re also quite attractive from a relative value standpoint.
Hence, I have recently started positions in both names at lower levels, and I would consider adding to my position if we drop below $65.50 on QSR and $314.00 on DPZ.
Disclosure: I am long QSR, DPZ
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.

Editor’s Note: Our experts here at INO.com cover a lot of investing topics and great stocks every week. To help you make sense of it all, every Wednesday we’re going to pick one of those stocks and use Magnifi Personal to compare it with its peers or competitors. Here we go…

It was an outstanding month for inflows into exchange traded funds (ETFs) in March.
Flows into ETFs almost tripled to $62.1 billion last month—with the bulk of the money heading into safe assets like government debt—as investors sought shelter from the recent banking crisis.
Developed market government bond ETFs soaked up a record $33.2 billion of the money, eclipsing the previous monthly peak of $27.4 billion set in May 2022, according to data from BlackRock.
Todd Rosenbluth, head of research at consultancy VettaFi, told the Financial Times, “In March, while net inflows to ETFs were strong, nearly all of the money U.S. ETFs gathered was in fixed income ETFs, led by Treasury products, as investors sought safety amid the banking crisis and the uncertainty of the Federal Reserve’s next move.”
It was interesting to note how expectations of two interest rate cuts by the Federal Reserve that might come later in 2023 affected the ETF flows. Investors betting on this would gravitate toward longer-term Treasuries versus those (like me) that prefer the safety of shorter-term Treasuries.
The $28.6 billion of net inflows into U.S. Treasury bond ETFs was divided almost equally between those focused on the short end, middle, and long end of the yield curve.
This divergence in views was visible in iShares 7-10 Year Treasury ETF (IEF), which gathered $6.1 billion in March. Meanwhile, at the other end of the maturity scale the SPDR Bloomberg 1-3 Month T-Bill ETF (BIL) pulled in $3.8 billion according to VettaFi data. And the iShares US Treasury Bond ETF (GOVT), with an effective duration of 6.3 years, was just behind at $3.7 billion.
Let’s do a comparison of the two ETFs on the two duration ends of the yield curve – BIL and GOVT – over the past very volatile year. The quick and easy way to do this to ask Magnifi Personal to run the comparison for us. It’s as simple as asking this investing AI to “Compare BIL to GOVT.”
Not surprisingly, BIL is vastly superior. Not only is it less volatile, but the return was superior.

This is an example of a response using Magnifi Personal. This image is not a recommendation or individual advice. Please see bottom disclaimer for additional information, including INO.com’s relationship with Magnifi.
This is just a starting point, of course. Magnifi Personal can easily compare several stocks or ETFs on more criteria, such as dividend payments, turnover, volume, and so on.
You can do it, too. Get access to Magnifi Personal completely free-of-charge – just click here.
This ability to have an investing AI pore over reams of data for you in seconds and spit out an easy-to-understand comparison of two or more stocks is an invaluable tool in deciding where to invest next.
We highly recommend you try it out. Click here to see how.
Magnifi Personal makes research like this as simple as typing a question. You can easily do this yourself, or ask Magnifi Personal to add other measures to the comparison, including dividend, valuation metrics such as P/E or P/B ratios, gross margin, and more.
Just click here to see how to set up your Magnifi Personal account.

INO.com, a division of TIFIN Group LLC, is affiliated with Magnifi via common ownership. INO.com will receive cash compensation for referrals of clients who open accounts with Magnifi.
Magnifi LLC does not charge advisory fees or transaction fees for non-managed accounts. Clients who elect to have Magnifi LLC manage all or a portion of their account will be charged an advisory fee. Magnifi LLC receives compensation from product sponsors related to recommendations. Other fees and charges may apply.
Diversification does not guarantee a profit or protect against a loss in a declining market. It is a method used to help manage investment risk.
Mutual Funds and Exchange Traded Funds (ETFs) are sold by prospectus. Please consider the investment objectives, risks, charges, and expenses carefully before investing. The prospectus, which contains this and other information about the investment company, can be obtained from the Fund Company or your financial professional. Be sure to read the prospectus carefully before deciding whether to invest.

Year-to-date, the largest exchange-traded fund by assets under management, the SPDR S&P 500 ETF (SPY), has seen an astonishingly large amount of money flow out of the fund.
Remind you; this is also when the S&P 500, and thus SPY itself, is up 7.09% year-to-date. That is important to note because it highlights that the fund does not necessarily see money leave the fund when the market is getting hit.
The SPY has over $372 billion in assets under management, making it the single largest ETF. SPY also holds the crown of being the most liquid, which may not mean much to the average investor, but that is very important to Wall Street professionals and prominent investment managers.
Liquidity is important because it means these investment managers can get in and out of positions with no genuine concern about whether or not there is a buyer or seller on the other side of their trade.

So how much money has SPY seen leave since the start of 2023? $9.43 billion!
Let that sink in and think about the fact that only about 150 Exchange-traded funds in the US have more than $9 billion in assets under management. That is 150 out of the 3,126 ETFs that investors have to pick from.
SPY lost more assets in three and a half months than nearly 3,000 funds have period.
Why is the money flowing out of SPY?
Unlike during other times when we see significant outflows of ETFs, so far in 2023, it has not been because the market is declining. Typically when the market is in a downturn, we see outflows occur as investors pull their money from risk assets and put it into reduced-risk assets. Think about pulling money out of stocks and putting it into bonds.
While an argument could be made that investors are preparing for an upcoming recession this summer, that argument is hard to support since the market is higher. We have not yet seen major economic data indicating that a recession is imminent.
The more likely reason money is flowing out of SPY at such an aggressive rate is the fee that SPY charges its investors. SPY charges a 0.09% expense ratio, which is extremely low by all means and measurements.

However, SPY is a simple S&P 500 Index fund like the Vanguard S&P 500 ETF (VOO) or the Ishares Core S&P 500 ETF (IVV). However, VOO and IVV only charge investors a 0.03% fee to invest their money.
The 0.09% SPY charges are much lower than the 0.65% or higher expense ratios we often see from actively managed ETFs. But, then again, the 0.09% SPY charges is three times more than the 0.03% the other S&P 500 ETFs currently charge.
All three funds do the same thing, track the S&P 500 index. So the question is why investors would pay three times as much for the SPY fund as opposed to VOO or IVV.
The only answer I can come up with is liquidity.
It is funny, though, that as more funds flow out of SPY and move toward VOO and IVV, SPY will also potentially lose its liquidity title.
And if SPY doesn’t hold the title for the largest ETF, doesn’t have the best liquidity, and isn’t the cheapest ETF in its sector, then why would any investor continue to use SPY as an investment vehicle?
Just something to think about if you have money in SPY.
Matt ThalmanINO.com ContributorFollow me on Twitter @mthalman5513
Disclosure: This contributor did not hold a position in any investment mentioned above at the time this blog post was published. This article is the opinion of the contributor themselves. The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. This contributor is not receiving compensation (other than from INO.com) for their opinion.

Back in January, I attempted to answer the question “Is Dollar’s Dominance Over?”, as the dollar index (DX) had experienced significant losses.
However, we received two conflicting signals from the technical chart, which provided a bearish alert, and the interest rate differentials chart, which indicated support for the dollar.
In both polls, the majority of readers voted that the dollar’s dominance was over and that it had already peaked for the dollar index.
Since then, the DX has made a bounce close to $106 with the support of a hawkish Fed, however these gains proved to be unsustainable, and the price dropped back down to hit the valley established in January, reaching a new low of $100.

Is the dollar headed right into the abyss?
Let’s take a look at some updated charts, starting with the interest rate differentials.
Source: TradingView
This time, I will be using a monthly time frame to provide a closer look at what could potentially cause the dollar to decline.
The majority of real interest rate differentials remain bullish for the dollar, with the orange line representing the gap between the US and UK establishing a new top of 6.15%, and the red line representing the US-Japan gap breaking into positive territory at 3.4% and catching up with the US-EU differential.
However, the US-EU differential represented by the blue line is spoiling the positive outlook for the dollar as it has been falling since its peak of 5% in September 2022. It’s important to note that the euro is the largest component of the dollar index, and this downtrend in the interest rate differential is putting downward pressure on the DX.
The pace of the dollar’s descent may be somewhat exaggerated, as it appears to be based more on an emotional outlook than on current fundamentals as the curve of the blue line is not that steep and the Fed is not yet running out of ammo.

 Loading …
The next chart follows to show the technical outlook.
Source: TradingView
The dollar index futures have now hit a crucial support level, with the orange dashed line on the chart indicating the 2015 high of $101 positioned just above the psychologically significant level of $100.
Additionally, the RSI indicator has reached the critical support level of 50. Indeed, the dollar is on the edge now.
At this crossroads, the dollar faces three potential paths.

The first path, illustrated by the blue arrow, represents a non-stop rise of the dollar towards the upside of the black uptrend line at around $117. This path could be supported by a more aggressive tightening from the Fed, a “flight to safety” scenario similar to the Great Recession of 2008, or a major geopolitical event.
The green path suggests that the upward movement seen in 2021-2022 was only the initial part, and we may witness a second upward movement after a period of consolidation around the current equilibrium. This view is more technical in nature, as it follows the concept that the 2001 peak at $121 should be retested before any major reversal occurs for the DX on a global scale.
The red path indicates that the dollar index futures may continue to weaken due to the growing trend of countries looking to trade without the use of the US dollar. This is reflected in the increasing number of countries expressing their desire to move away from the dollar as the world’s reserve currency.
The initial support level would be at the downside of the uptrend around $94, while the growth point of $89 in the valley of 2021 would be the subsequent crucial support.

 Loading …
Intelligent trades!
Aibek BurabayevINO.com Contributor
Disclosure: This contributor has no positions in any stocks mentioned in this article. This article is the opinion of the contributor themselves. The above is a matter of opinion provided for general information purposes only and is not intended as investment advice. This contributor is not receiving compensation (other than from INO.com) for their opinion.

Please enjoy this updated version of weekly commentary from the Reitmeister Total Return newsletter. Steve Reitmeister is the CEO of StockNews.com and Editor of the Reitmeister Total Return.
Click Here to learn more about Reitmeister Total Return

Six months ago, stocks made fresh lows of 3,491. Since then, we have seen a hefty bounce to our current `perch at 4,137.
So are we in still in a bear market…or has the new bull emerged?
That vital discussion, along with our trading plan with top picks, will be at the heart today’s commentary.
Market Commentary
Technically speaking we are still in a bear market. That is because the definition of a new bull market is when the S&P 500 (SPY) rises 20% from the lows. Here is that math:
3,491 October Lows x 20% = 4,189
However, some will say that was only an intraday low and more appropriate to measure based upon the closing low of 3,577 set on October 12. That would mean stocks would need to break above 4,292 to be considered in bullish territory.
The point is that we are getting closer to a bullish breakout. Yet where we stand at this precise moment is a state of limbo which is what creates a trading range.
One could say it’s as wide as the recent lows of 3,855 up to 4,200. But I think most of the near future will be spent in a tighter range of 4,000 to 4,200.

Why Are We in Limbo?
The threat of recession still looms large. This was reinforced Wednesday because the FOMC minutes discussed their fear of recession later in 2023 because of residual damage from banking issues.
On the other hand, we have heard about the threat of recession since early 2022…and it keeps NOT happening.
This has led many traders to not hit the sell button too hard on any whispers of recession. They have been faked out too many times on that in the past only for the market to bounce back ferociously as no recession unfolded.
This is creating an upward bias in the market the last 6 months. Yet will be hard to see too much more upside until the bears are thoroughly convinced that no recession will be in the offing.
Meaning the clear new bull market breakout will not happen until more bears are convinced of an improving forecast. When more of them turn tail and start buying in earnest is when the new bull market will begin.
BUT WHAT IF A RECESSION DOES FORM?
Indeed, those recessionary storm clouds still linger especially as the Fed’s primary goal is to stamp out inflation by “lowering demand”. Lowering demand is just a fancy way of saying they want to slow down the economy.
In a perfect world that is a soft landing near 0% GDP before the economic growth engines restart. In that scenario we have already seen the stock market lows and the next bull market would emerge.
However, just as likely is that all the steps to “lower demand” actually spark a recession with negative growth, job loss and yes, much lower stock prices (below the October lows).
Recent shocking declines in ISM Manufacturing, Service and Friday’s Retail Sales report do paint the picture of an economy potentially tipping over into negative territory. And again, remember that the FOMC minutes did point to their increased concerns that the recent banking issues will be harmful to the economy likely leading to a recession by end of the year.
As long as these serious threats linger, then there will be enough people rightfully bearish to prevent the overall market from heading much higher.
The sum total of this stand off between bulls and bear is a trading range environment likely with serious resistance at 4,200 as was found in February. I don’t even believe the May 3rd Fed announcement has the muscle to change that outcome.
Thus, I could see this trading range scenario in place for a good part of the summer until investors can better determine the true likelihood of recession.
One of the classic investor sayings is that we do not have a stock market as much as we have a market of stocks. Meaning that each individual stock has the potential to rise no matter the overall market environment.
It is much easier to appreciate the virtue of this saying when you understand that over 2,000 stocks were in positive territory in 2022 even as the bear market got its claws into most others. And amazingly over 1,000 of those stock rose 50% or more.
This begs us to always be on the lookout for the very best stocks and funds to outperform. And in my 43 years of investing experience nothing does a better job of that than the POWR Ratings scan of 118 different factors that point to a stock’s likelihood of future success.
So even though I fully appreciate the potential for recession and deeper bear market, I still want to be pinpointing the very best stocks and funds to hold in our portfolio.
What To Do Next?
Discover my balanced portfolio approach for uncertain times. The same approach that has risen well above the pack so far in April.
This strategy was constructed based upon over 40 years of investing experience to appreciate the unique nature of the current market environment.
Right now, it is neither bullish or bearish. Rather it is confused…volatile…uncertain.
Yet, even in this unattractive setting we can still chart a course to outperformance. Just click the link below to start getting on the right side of the action:
Steve Reitmeister’s Trading Plan & Top Picks >
Wishing you a world of investment success!
Steve Reitmeister… but everyone calls me Reity (pronounced “Righty”)CEO, StockNews.com & Editor, Reitmeister Total Return

About the Author
Steve is better known to the StockNews audience as “Reity”. Not only is he the CEO of the firm, but he also shares his 40 years of investment experience in the Reitmeister Total Return portfolio. Learn more about Reity’s background, along with links to his most recent articles and stock picks.