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All of them? Historically stocks rise after splits.

For me, first choice is GOOG. 2nd choice is SHOP. Don’t know RH. AMZN is still too expensive at this price

Eric Holder says

Historically stocks raise after splits.

I suppose more people feel they can "afford" the stock at a lower price, but it doesn't have anything to do with the financial performance of the company itself, so any rise after a split seems unjustified imho.

Patrick says

Eric Holder says

Historically stocks raise after splits.

I suppose more people feel they can "afford" the stock at a lower price, but it doesn't have anything to do with the financial performance of the company itself, so any rise after a split seems unjustified imho.

Also, sometimes when certain stock goes up other stocks with similar tickers go up in sync. =)) Like ABB going up on the day of ABNB's IPO.

Would not touch any of these stocks with a 10 ft pole. Are you kidding? Tech is done with the Fed rapidly deleveraging. Have made the case for selling tech profits for over a year now on here. The only one you could make a case for is shop since it lost already 75% of its top value, as a bottom value play. That being said, it can go down another $100 easily before it really rebounds. This is a recession. Go with defensive dow stocks, agriculture, fertilizer, defense, precious metals, energy (maybe), and select small cap biotechs who are much better bargains and run often for profits. Also buy and hold is gone, you need to be actively trading unless you have a 5+, better 10+ year horizon.

DooDahMan says

gabbar says

Which of these is worth buying before the split?

Out of bored curiosity why would you seek financial advice from/on an anonymous internet forum ?

I also agree with this, take any opinion w/ grains of salt

mell says

select small cap biotechs

Lots of layoffs at biotechs these days. Quite a lot of hype plays deflating.

Al_Sharpton_for_President says

mell says

select small cap biotechs

Lots of layoffs at biotechs these days. Quite a lot of hype plays deflating.

True, key is "select". You can never trade biotech without doing thorough DD but it's good practicefor any sector. My portfolio just reached and all time high amidst the carnage and it only contains biotechs, small and mid caps. Incredible value in some who must got approval or are a sure shot to get it and are starting to commercialize. Typically they do one fat dilution to get them over the hump to become profitable, sometimes two or three. Get in at the lows on the last one and let it turn into a multi bagger, however always sell int runs and buyback on and market days. Create "freerding" shares you can potentially eventually retire on.check my history, recommended atrs at 2 got bought out at 5.60, vcel at 3, it ran to 70, now around 30. Arry at 2, got bought out at 40. Not everyone hits, but plenty. Currently like scyx and obsv at these low levels. Athx is a more risky, pure binary play gamble, binary data coming out very soon though.

gabbar says

GOOG, RH, AMZN, SHOP

The markets are starting to crash with these stocks at the forefront, all of whom are under their respective 50 EMAs on the weekly price bar.

Since these stocks are not dividend payers, they're no point buying at the 'midpoint', since you won't be getting to reinvest dividends at the bottom to bundle up your earnings.

Rin says

gabbar says

GOOG, RH, AMZN, SHOP

The markets are starting to crash with these stocks at the forefront, all of whom are under their respective 50 EMAs on the weekly price bar.

Since these stocks are not dividend payers, they're no point buying at the 'midpoint', since you won't be getting to reinvest dividends at the bottom to bundle up your earnings.

Even dividend stocks may not hold and at some point suspend it, or the price decline is so sharp that the dividend is not of much help, though they should be generally better than the tech trannies. They key is select stocks you have done thorough DD on, which should always be the basis of a stock purchase. And mostly defensive sectors

SHOP now has a PE of 22, sounds much better than 110 right? In a recession PEs can go as low as 1 or even below, but usually growth stocks sport a higher PE. I'd say this is an ok PE to nibble a bit and start accumulating if you're into tech trannies, but if it goes to 5-10 then bigger bites can be taken. Generally looks for stocks with as low PEs as possible during a recession (also generally good advice), or those on the cusp of profitability who have (hopefully) just finished their last round of dilution. And boring, defensive moneymakers, don't need to be high growth, in fact better if not since that growth likely gets stunted during the recession, more important is continuous boring earnings, low beta (i.e. not affected by the market or economy turmoil, such as pharma stocks who have insurers coverage for their drugs, or defense and agriculture stocks).

mell says

Even dividend stocks may not hold and at some point suspend it, or the price decline is so sharp that the dividend is not of much help

That's why you buy dividend aristocrats.

zzyzzx says

mell says

Even dividend stocks may not hold and at some point suspend it, or the price decline is so sharp that the dividend is not of much help

That's why you buy dividend aristocrats.

GE, once the largest company in the world (by market cap) and definitely a dividend aristocrat, hit it's all-time stock price peak in year 2000 and has cut its dividend to yield less than 0.5% annually. So you can take a bath on an aristocrat. AT&T is another example.

"price decline is so sharp that the dividend is not of much help" The dividend is expressed in absolute dollars and cents, so a stock price drop doesn't mean any change in the dividend. If you bought the stock for the dividend income, you're still getting that dividend income. However, taking note of the two companies I mentioned in the previous paragraph, a massive stock price drop usually means some sort of business trouble, which leads to financial trouble for the company, which then leads to the company drastically cutting the dividend.

Speaking of tech...FB enacted a 2022 hiring freeze for most positions.

Sounds like tiktok is kicking their ass, and their tyranny policies sent people running.

Patrick says

I suppose more people feel they can "afford" the stock at a lower price, but it doesn't have anything to do with the financial performance of the company itself, so any rise after a split seems unjustified imho.

Amazon is down 40% from its all time high and the S&P 500 is down about 15%.

I own 20 shares of Amazon and hope the shareholders approve the 20 to 1 split. I'll be able to sell 4 covered call contracts each week, or month for Amazon.

Amazon's PE ratio is now around 55. Before its stock price crashed recently by 40%, its PE was above 100.

GuruFocus shows Amazon is undervalued, and gives it a GuruFocus Value rank of 8 out of 10 and a Growth rank of 10 out of 10.

.

The PE ratio for the S&P 500 is 20.8. It last peaked a few months ago around 37. In comparison, it peaked around 44 in early 2000 toward the end of the dot com bubble.

At 20.8 it presently is lower than where it was when the market crashed in Spring 2020.

https://www.multpl.com/s-p-500-pe-ratio?source=patrick.net

.

mell says

Even dividend stocks may not hold and at some point suspend it, or the price decline is so sharp that the dividend is not of much help, though they should be generally better than the tech trannies. They key is select stocks you have done thorough DD on, which should always be the basis of a stock purchase. And mostly defensive sectors

Right now, I've stopped buying shares of the traditional blue chips because they're too expensive.

I have a thread on trading ...

https://patrick.net/post/1344975/2022-05-05-rin-s-last-dance-for-2022

Rin says

mell says

Even dividend stocks may not hold and at some point suspend it, or the price decline is so sharp that the dividend is not of much help, though they should be generally better than the tech trannies. They key is select stocks you have done thorough DD on, which should always be the basis of a stock purchase. And mostly defensive sectors

Right now, I've stopped buying shares of the traditional blue chips because they're too expensive.

I have a thread on trading ...

https://patrick.net/post/1344975/2022-05-05-rin-s-last-dance-for-2022

what would you recommend buying right now? i know everything is kind of down lately, i just see it as temporary discount.

FortWayneAsNancyPelosiHaircut says

what would you recommend buying right now? i know everything is kind of down lately, i just see it as temporary discount.

Well, there will be a great discount on all the blue chips when it goes down. And that includes Proctor & Gamble, 3M, ConEdison, Walmart, etc

Right now, here are the combinatory indicators which could spell a full market crash ...

https://patrick.net/post/1344089?160#comment-1838336

This was the correlation I was looking for, in terms of weekly candlesticks. Realize, the longer the time frame, the better the predictive ability.

1) The Russell finally closes a week outside of the long running price box



2) The EURO is testing a decade long low against the USD.



3) The Pound Sterling is just about to enter that same price box of the decade's low.



Now, given the fact that the blue chips are mainly overpriced so that dividend reinvestment (DRIP) is basically overpaying for those shares, it's better to simply bank whatever the blue chips give you every quarter, until the next market correction.

But sure, I have my Rio Tinto, Altria, & British-American Tobacco shares on DRIP mode, as they're properly priced with high dividends, so any market correction will result in a huge no of reinvested shares.

Ok, so the last dance for 2022 is Carl Icahn Enterprises, IEP. IEP is basically a high dividend stock, 15+%, but with poor fundamentals. In other words, if anything happens to Carl's health (he's in his 80s) or one or more of his deals go south, the company may cut dividends and see its price go into the toilet. And his heir apparent is his son, which doesn't give me much confidence ... just look at George W Bush or any other organization where nepotism is the way of the land.



So with this stock, the idea is to use those blue chip dividends to mastermind the trade. In other words, use guaranteed dividend income to pay for a risky trade.

And in this case, given the fact that 1) Icahn could fail with its stock pricing plunging or 2) the market could tank which could easily take IEP down with it, one should pay for a LEAP put option on the downside and then, sell (re-claiming half the value) at the mid-term, & re-purchase that put option, for a latter expiration time to maintain a level of insurance while also adapting the pricing for the present stock ticker for IEP. So far, I'm predicting that the ~15% dividend would cost some 5-7% per annum in terms of the downside protection which nets one a 7-10% yield on their investment.