$RUT continues its climb despite the political headwind caused by the Italian political crisis $EWI | #ActiveInvesting https://t.co/KsqIRrz8xJ
— Mara Thon (@mezzamaratona75) May 31, 2018
Tag: technical analysis
Is the valuation of the S&P 500 reasonable?
Commodities and precious metals are on the rise
The energy sector has had a good 2018 so far
Here is an example of an energy stock which has bested the market and a lot of its peers: Valero energy $VLO
Are these two indicators telling the same bullish story ?
I would describe myself as a value investor but can recognise some technical patterns or money outflow whenever I see some.
It would appear that the S&P500 is breaking out as shown on this graph:
Equally, it would seem that a significant outflow of money has been recorded from volatility investments which had dominated the market stories in the past weeks:
Some would see these two observations as a bullish indicator. While I keep this information in the back of my head, I remain a stock picker rather than just an investor who follows the herd.
Featured stock of the week: Applied Materials
Despite the recent drop following Q1 2018 #earnings, Applied Materials, $AMAT, still looks like an attractive investment idea.
The reported earnings show very good growth in both the top and the bottom line, however the analysts were put off by the guidance provided during the conference call.
From a valuation point of view, the stock still looks cheap with a PEG ratio (5 years expected) well below unity as you can appreciate from Yahoo Finance.
Now that the stock is trading below the 200 days moving area it may be a good idea to see whether and how this sudden drop is temporary or the start of a downtrend prior to initiating any position or accumulating.
An example of an undervalued computer hard disk drive manufacturers stock
If you look at the valuation of Western Digital ($WDC) these days you will find that the stock is very undervalued. According to YahooFinance it has a PEG ratio (5 years) of 0.2 !
As regards technical performance, the stock has lagged behind lately and is currently trading below its 20, 50 and 100 days moving average:
Value investing requires patience: even though the stock is trading at a discount with regards to projected future earning, timing is of the essence and one would need to watch if the market recognizes the value of Western Digital before starting a position.
Responsible Investor 