3D Printing (SSYS), Coca-Cola (KO), are we headed for a correction?

Podcast Transcript

Hey, this is Jeffrey with another edition of Stock Smart, the February 19^th, 2021 edition. Hope everyone’s doing well. Again market is up again a little bit, still unwinding in the S&P 500 oscillator. The oscillator is unwinding, going down a bit, not a safe buying level yet, but it continues to unwind a bit VIX is down about 4% today. So the fear-gauge moving in the right direction for investors and the 10-year T note continues to move up along with the anticipation of inflation, which will be a key indicator again for investors. Once the 10-year gets a little more enticing to those who want a safe return when it gets maybe 2-3% that’s when we’re going to see, and the 3% would be a while on the 10-year, but the 10-year at 2% may have investors looking for a safer return. Palantir kind of interesting.

[00:00:48]
We were talking about Palantir and how the lockup had expired, stock has been down the last 4-5 days. Today got a bump up about 13-14% today. Interesting investor bought about 5 million shares Cathy Wood from ARK fund purchased 5 million shares yesterday. So generally people have been watching what she’s been buying and piling into her stocks but Palantir up again today. Not so sure that all the selling of insiders is done. So you may want to be really careful with investing in that but the lock up period has expired and there was a bunch of selling, it’s gone down significantly, you know, it found some support at around 24-25 and has bounced up today and a lot of that probably has to do with Cathy Wood putting stake on Palantir or buying five million shares I should say.

[00:01:40]

Stock we want to look at today is Coca-Cola. Now Coca-Cola had some interesting announcements. They are going to raise their quarterly dividend to a yield of 3.3 overall. Coca-Cola is one of our dogs of the Dow stocks that we want to pay attention to because we’re excited about Coca-Cola because they are introducing a hard seltzer in their Topo Chico brand, they’re going to start opening that up to the states later in the year. They are testing it in Latin America and some European markets. So that’s a stock that we want to pay attention to, Coca-Cola, was down a lot early in the year has kind of rebounded a bit the last few weeks, AMC, another stock bouncing up today a little bit AMC up 2% to $5.64 this year.

[00:02:22]
We like AMC not because of the short squeeze it was in the last couple weeks and I certainly don’t like it at no 21-22 or even where it was at 14 especially right now, but if 4 and $5, it’s not a terrible stock. I mean if you look at it over the life of the stock it was at about a high of 35 in 2017, stock really resides in a range of 14 to 20 when economic times are good and people are going to movie theaters. So it’s got some problems it’s going to unwind from, took on some debt to keep the business going. If you believe that the vaccine is taking hold and all the reports and everything you’re reading, is the vaccine is starting to take hold and people are going to return to normalcy.

[00:03:04]
You going to want to go to movie theaters. So at $5 a share or $5.64 a share, AMC is not a terrible investment. Now when it got caught up in the GameStop stuff, Reddit and the users were buying it and pushing the stock up 13-14, was a little passed where it should be right now, but this is a stock in the reopening that will creep back. You should return it some kind of normalcy in the next year in the range of 14 to 20. So, if you’re a long-term investor, it’s not a terrible stock at $5, so you can ignore some of the garbage that’s gone on with GameStop. It’s not overvalued right now. I mean, if it’s overvalued it’s only slightly overvalued because generally has a lot of support in the $5 to $6 range.

[00:03:43]
So this might be typical investors piling in long-term looking at the reopening and a lot of reopening stocks are doing well.

STOCK WATCH

Stock we’re watching now is Stratasys, ticker symbol SSYS, their marketing language says this. We’re going to do this from now on, we’re going to look at the marketing language because it’s kind of funny and humorous to read these things. So Stratasys SSYS, engages in the provision of applied additive technology solutions for industries, including aerospace automotive healthcare consumer products and education. If you read that you don’t know anything. You don’t know what they do, but let me go on, it says, systems include desktop 3D printers. There you go. What do they do? Desktop 3D printers, for idea and design and development, various systems for rapid prototyping and large production systems for direct digital manufacturing. So this again, this is a 3D printing company. I love this technology.

[00:04:37]
I think it’s going to continue to grow and grow, a friend of mine has a son that’s an engineer, works on part-time projects and his son made them a bag clip that he invented himself, now you usually buy a bag clip for your chips your potato chips and it’s got a spring, they break. It’s made of really cheap plastic. They usually break pretty quickly. My friend gave me one of these bag clips. He’s like, hey my son made these, they’re 3D printed, really cool technology. I mean this thing is not going to break because of the polymers that are in these, the additives that it’s molded in, it’s not one of these cheap bag clips.

[00:05:13]
So that is the coolest technology and I’ll tell you this is going to last a long time when you buy a bag chip or a chip clip they last for about 6 months or whatever and then they break, now this 3D-printed bag clip is amazing and it’s going to last a lifetime and you can see a lot of applications. This is how I see this going for 3D printing and this is why it’s very exciting technology. Stratasys, I was in the stock, I think it was early to the stock, about two years ago and it really didn’t do anything. But now it’s picked up. It’s in a nice groove. It was slightly overbought. Let me tell you another application that I like for Stratasys.

[00:05:44]
I have a friend who owns a pretty large plumbing company and I can see him with his men go out in their truck, needing a part. They don’t have it in stock. But essentially they order the part on a 3D printer right in the truck and it makes the part and then they go install in someone’s house. That’s the future of what 3D printing’s going to be. It’s going to be direct on demand products that you need and you can make right when you’re doing a job. And so I like 3D printing, Stratasys is in a good technical place right now, stock was over bought in January, late January when it went to a high of 55, moving up today about 10%, up $4.22 to 45 could take out the old highs at 54-55 because now it’s sold off a little bit.

[00:06:31]
It dropped about from high 50s to the low 40s where it found support so looking to bump up but I like this company Stratasys SSYS, 3D printing, that’s the future, you’re going to start seeing this being applied in more and more places as a technology for 3D printers gets cheaper and the polymers and things needed for the 3D printing get less expensive as well. And this is going to be a coming trend, so auto manufacturers are going to make parts they need for cars, how people everyday use like a plumber, or an electrician may need a part on the job. They’re going to make them on site so Stratasys

THE AVERAGE INVESTOR

I got a question from Christine, she wants to know a little bit about the market and what we see going on in the future? And how long or when you think we might get a correction?

[00:07:13]
Well, I’ve been talking about this for the last couple weeks, 2,3, 4 weeks that I believe that if we’re going to get a correction and again, we might not get as big of a correction right now as we kind of need or would like to have in the market to get like a little bit of a cheaper price earnings ratio in the S&P 500 because it’s fairly high, 22-23. We would get around 21, that would be a lot safer place for the S&P 500 PE. We may get a correction when we get out of earnings which is going to happen in the next week or two, once earnings subside, lower buybacks get a chance for the market to cool off a little bit. That’s when we think if you we’re going to get any kind of correction, will probably be in the next couple weeks.

[00:07:52]
Maybe get a 5% correction. We had a little bit of correction earlier in the year. That was only like at 3 or 4% correction, but I think it you look for something to happen when we’re going to go to this period where buybacks are not going to probably happen at the rate that they have in the past. We’re going to get a little bit of a downturn and I would say in the next couple weeks, 3 to 4 weeks after earnings are done. That’s when you may see a little bit of drop on the market, so thanks again numbers are growing for the show. Appreciate the questions. You can send them to Jeffrey@JeffreyKamys.com and we’ll see you again next time on Stock Smart.