Stocks to buy right now? (if any)
What do you all think of the current market? Has it reached it’s lowest point? Do you think the market will crash again? Also are there any stocks I should look at investing in right now or do you think the market is too high at the moment?
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Schrodinger
Only stock you should be buying is chicken stock.
Bruh where were you in March 2020? U completely missed it
Voo
It seems to me that the market is untethered from reality right now. I guess the idea is that the Fed will pump unlimited amounts of money into the system, and that the economy will quickly bounce back. I have a hard time seeing the latter...the virus will be a concern for a while, and a lot of the damage done so far will last for years. Apart from stock prices, a lot of the economic indicators aren't just bad- they're insanely, unprecedentedly bad.
Here's the current unemployment situation. Nuts. This isn't going away in a couple of months.
![https://image.cnbcfm.com/api/v1/image/106547125-1590064408599-20200521_…]
Yep, the govt is propping it up for the time being
Wait until the extra unemployment benefit ends, the Covid relief checks are no more, and Americans get their heads out of their asses and see what’s actually going on
From WSB a few weeks ago:
https://www.reddit.com/r/wallstreetbets/comments/gb6dzw/everyones_fucke…
![https://i.imgur.com/ohDKCIO.jpeg][https://i.imgur.com/ohDKCIO.jpeg]
I generally agree with your post but just wanted to present a different viewpoint. more of a gut instinct and I don’t have data to back it up, but something to think about.
yes, unemployment numbers are insanely high, but the service industry / low skilled workers represents a disproportionate number of those unemployed. I would argue that unemployment isn’t as erosive on human capital for these workers and because the current crisis is not really a structural one (rather it was caused by govt mandated shutdowns), as soon as states reopen these workers will be able to get back to work - even if not at their prior place of employment.
for example, let’s look at a restaurant dishwasher that is unemployed because of covid. the training / skills that worker acquired can be applied interchangeably at a variety of restaurants/other businesses, so as soon as the state governments lift the lockdowns, that person can re-enter the workforce. this is in comparison to the financial crisis, where unemployment more broadly encompassed a variety of sectors, impacting a lot of types of labor where the erosion to human capital resulting from unemployment was huge and affected workers that couldn’t really pivot to another line of work (e.g. mortgage brokers, construction workers, etc.)
with all this being said, I think the biggest problem moving forward will be a demand issue: even if states open up completely, I think residual fear of social events / living a “normal” life will prove time be a huge burden on the economy, really until a vaccine is developed. even if restaurants CAN open, if there is no demand because people don’t want to eat out anymore, then the majority unemployed low-skilled workers will remain unemployed
a few people I know started a group to discuss exactly this and it's actually grown pretty meaningfully over the past few weeks. not sure if anyone has heard of it but it's turned into a large-scale forum (similar to WSO) but it's focused solely on stock / public market investing.
it's on Reddit and the thread is called wallstreetbets, you should definitely check it out.
Gazprom is interesting from a value perspective with a PE ratio under 4.
Glad you brought it up. Bought at around $4 and plan to hold it for the next few years.
I'd hold off for now, let your 401k keep rolling into it, but I'm personally going to wait a while until we actually figure out what's going on and then probably jump in on some index funds and maybe a good reit.
Im getting in on Lehman Brothers Calls
Gazprom, Ternium, Prologis. You will thank me five/ten years later.
rly interested, do you mind giving a quick explanation for why you think each would be a good investment?
Gazprom - has about 20% of the world's total supply for natural gas and owns 35% of the European market. Recently signed a contract with China as well. The market hasn't been friendly to it in recent years because it's a Russian company. To be fair it is controlled by the Russian government so that is the biggest risk IMO. The market cap is $50bn what not while you go back ten years or so it was at $150bn while the competitiveness of Gazprom hasn't really changed much, I think the margin of safety is there.
Ternium - in my view it is a cyclical play (Peter Lynch mentioned it in his One Up on Wall Street) and is pretty undervalued right now (market price siginificant discount to book value). It is a South American steel company so that is the risk, but steel companies do well when the economy turns better, which is prbbly the biggest short-term risk right now. I personally don't mind holding it and ride the upturn in two to five years.
Prologis - largest logistics REIT in the U.S., second place is Blackstone's warehouse portfolio. Not rich enough to be an investor in Blackstone. Prologis is bigger than sum of all the public comps and the driver is pretty simple, e-commerce, which accounts for about 16% of the total spending in the U.S. (numbres vary but we're still early in e-commerce). I actually haven't bought any of Prologis because I think the valuation is slightly high for my own taste, but will definitely pull the trigger when the price is lower.
Just my opinion, and I'm more of a long-term investor rather than speculating on short-term noise.
We need more strightforward posts like yours. Investment tehses that make sense. Bravo!
Hopefully, your investment strategy isn't relying on the advise of people on message boards. If you don't have experience, stick with managed fund or a market ETF.
Everyone has flocked into big tech like sheep. If you have a confident view of any company outside that space, there’s probably still upside.
I still think there are many really good businesses totally discounted/undervalued b/c of expected corona implications. For example, a company that was planning massive expansion and postponed it b/c corona, you basically get option value on that construction at the moment (assuming it actually happens in the future). But then again, who tf knows what will happen
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