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A Simple Way to Repeatedly Bank Profits From Smaller Companies

Posted: 20 Sep 2019 12:15 PM PDT

The $50 U.S. Cannabis Jackpot

U.S. Penny Pot Stocks Set to Explode September 30th

Dear Reader,

Sixteen cents a day  can't buy you much of anything these days…

But it could buy you a ticket to the financial confidence of a lifetime.

As you may already know, marijuana legalization is set for another big win this coming midterm election.

It's ready to virtually steamroll across the country!

In other words, the war on marijuana is drawing to a close in the U.S.

This is your chance to turn mere pocket change… into an absolute fortune.

But you need to act ASAP!

Because once the midterm elections hit, several cheap pot stocks could get expensive.

Investors could rake in billions from legal pot.

According to CNBC,  “the industry is poised to be gigantic.”

And Forbes has touted that “hundreds of millions of dollars are pouring in…”

Click here for full details on how to stake your claim.

Already, some of the biggest and most successful names on Wall Street have acquired major positions in companies in the marijuana sector, investing millions…

I'm talking about PayPal creator Peter Thiel …  Reddit CEO and founder Steve Huffman … and even Warren Buffett.

Click here to see how a $50 stake in tiny pot stocks could turn into a massive fortune.

Regards,

Aaron Gentzler
Publisher, Seven Figure Publishing

Mortgage Rates Rise as Bond Market Declines

Posted: 20 Sep 2019 03:00 AM PDT

Cost to borrow rises, despite Fed's rate cut.

The cost of a mortgage rose to 3.73 percent on average from 3.5 percent in the past week, following a decline in the bond market. That's in spite of the cut in interest rates by the Federal Reserve, which is designed to make the cost of all loans, including mortgages, cheaper.

Despite the rise, mortgage rates remain near all-time lows, and the 3.73 percent rate was last seen as recently as August.

The move higher is the largest one-week increase since October 2018. One year ago, mortgage rates averaged 4.65 percent.

As a result of rising mortgage rates, mortgage REIT companies generally rose, as higher interest rates benefit their holdings. Homebuilders traded mixed, as higher costs to borrow typically weigh on home prices and sales.

Action to take: We've previously sung the praises of refinancing your mortgage at or near today's interest rates. Doing so can save tens of thousands of dollars in interest payments over the life of a loan, and a refinance can be structured to take equity out of a property or simply lower payments. It could be one of the best investment decisions you make.

If mortgages are starting to rise off their recent lows, even in spite of lower interest rates throughout the economy, the window may be closing to take advantage of lower borrowing costs.

 

Insider Activity: Scientific Games Corporation (SGMS)

Posted: 20 Sep 2019 03:00 AM PDT

Billionaire investor adds to stake.

Ronald Perelman, billionaire investor, added 100,000 shares of Scientific Games Corporation (SGMS), recently. The buy increase his stake by 0.27 percent, and cost $2.2 million. Perelman now owns over 36.5 million shares of the company, and holds more than 10 percent of shares.

Perelman has been a buyer in the past year, often at prices as much as 50 percent higher than where shares of the company currently trade. In that timeframe, only one insider has made a sale.

Las Vegas-based Scientific Games Corporation develops technological products and services for the gaming, lottery, and digital gaming industries worldwide. That includes gaming machines and table systems as well as virtual products as well.

In the past year, shares have declined 13 percent. The company is currently unprofitable, but analysts expect the company trades at 30 times forward earnings.

Action to take: Besides the high earnings ratio, the company has a large debt load of nearly $9 billion on the balance sheet, making shares something of a gamble. However, betting against the track record of Ron Perelman sounds a bit like a sucker's bet, and the gaming industry has attracted insiders over the past few months.

Investors should consider shares under $24, with an eye towards taking profits in the low $30 range. Speculators should look at the January 2021 $30 call option, which trades for around $4.50, or $450 per contract, as a cheaper way to play a rally in the gaming sector.

 

Unusual Options Activity: Philip Morris (PM)

Posted: 20 Sep 2019 03:00 AM PDT

Cigarette company shares may be due for a rally.

The October 11th $74 call options on Philip Morris (PM) saw heavy trading, with over 2,500 contracts trading against a prior open interest of 109, for a 23-fold gain in volume.

With shares of the company around $72, shares will need to rise by nearly 3 percent in the next 21 days to trade in-the-money at expiration. The buyer paid $0.55 per option on average, meaning shares will need to trade closer to $74.50 before making a profit.

Tobacco giant Philip Morris has seen shares decline 12 percent in the past year, and the company is currently in talks to merge with Altria (MO), a company it was once a part of before being spun off.

The company trades at 12 times earnings and has a 6.5 percent dividend yield.

Action to take: The tobacco companies are somewhat attractive at current prices, particularly thanks to their strong dividend yields as a result. We like shares of Philip Morris up to $75, although we don't see a quick rally in shares implied by this call option.

Speculators should instead look at the June 2020 $75 calls, which should give investors time to profit from any merger-related news. Speculators should look to take quick profits on the trade, given how tobacco stocks have bounced higher before heading sharply lower a few times in the past year.

 

Natural Gas Inventory Surges

Posted: 20 Sep 2019 03:00 AM PDT

Larger-than-expected build sends prices down.

The U.S. Energy Information Administration released weekly data on natural gas inventories, suggesting a stronger-than-expected build. With an increase of 84 billion cubic feet, inventories rose more than the 78 billion cubic feet expected.

The increase send natural gas prices down about 2 percent, to around $2.60. Inventories are particularly building up in the Midwest region, and without some cold winter weather, there could be a 500 billion cubic foot surplus by year-end.

Natural gas prices typically decline in the summer and rise in the winter, when natural gas is in demand as a heating fuel. The buildup now, at the wane of summer, isn't unusual. But with high levels of natural gas production thanks to inexpensive fracking methods, prices remain near multi-year lows.

Action to take: For the moment, none, but this is an area that could see a big move upwards in the coming months on cold winter weather. The seasonal trend for natural gas demand is still intact, and investors who wait for things to look bad can get a great price in various names in the natural gas space.

Speculators may want to look at the VelocityShares 3x Long Natural Gas ETN (UGAZ), which is leveraged to make a move triple that of natural gas. Shares can likely get back to their 52-week low of $11 before heading higher, and may be the best way to play a bounce on natural gas prices in the winter.

 
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