Best Buys Now July
These are 5 stocks I expect to outperform over the long term (and buying)
Hi Multis
Today, it’s the 15th of the month and you know what that means: the Best Buys Now!
Earnings season is about to start again, and every time, like clockwork, the same thing happens: Suddenly, everyone becomes a short-term thinker. A company beats on revenue and EPS, but misses on some metric nobody really cared about three months ago, and the stock drops 15% in a day. Or it guides “cautiously” and gets punished for being honest.
And sometimes, a company beats on revenue, EPS and raises guidance, mentions a new partnership or initiative and the stock shoots up 25%.
I’ve learned to like those days. Because one quarter tells you very little about a great business. Not positive, not negative. But the quarters, taken together, and the clear scores that every company gets here tell a story. Sometimes, that’s a fairy tale, sometimes a horror story, sure, but it’s also important to remember that many fairy tales look like horror stories when you isolate parts of them. That’s why one or even a few quarters don’t tell the full story and I will always err on holding too long, not selling too early.
In the Best Buys Now, I often pick stocks that are a bit out of favor, and that can stay out of favor for a while. Some of these names will test your patience over the coming months or maybe even years. That’s fine for me as I am patient. But know yourself and know what your behavior is.
And as usual, I put my money where my mouth is. Every one of these picks is a stock I’ll buy myself for my PM Forever Portfolio.
Just one last remark before we start: while the picks are numbered, that order is completely random. It’s not a ranking, and number one is not “better” than number five.
As you know, I let go of a fixed number of stocks. Sometimes I see more opportunities and pick more stocks; sometimes I see fewer and pick fewer. That doesn’t mean there aren’t more opportunities. Maybe it’s just that I don’t see them. Maybe there are opportunities in oil, silver, or a defense contractor that I don’t see. I don’t focus on those domains and probably never will. They are not my expertise and that is because I’m just not as passionate about these.
But enough introduction now. Let’s dive in.
1. Mercado Libre
Mercado Libre was in the Best Buys Now last month as well, and it is up 12.67% since then, but I include it again, as I still see it as cheap right now.
If you want to know why, my 35-minute webinar about Mercado Libre tells you everything you need to know.
Below: the four other stocks I'm buying for my Forever Portfolio this month.
One is down 44% in a year with the lowest valuation ever.
One is a SaaS name the market thinks AI will kill (the numbers say the opposite).
One is a well-known stock I've never owned before.
And one is in healthcare and is still underestimated, in my opinion.
I'll buy all four right after this article is published.
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