“Timed Stocks” Are Going Into Overdrive

Palm Beach Daily

Chaka’s Note: Today, we’re featuring an essay from Palm Beach Daily regular and tech investing expert Jeff Brown.

For new readers, Jeff’s decades of experience in the technology side of business, finance, and investing had made him our go-to guest editor when reporting on the latest under-the-radar tech investment opportunities.

And regular readers know that Jeff’s unique perspective and experience means he has an eye for opportunity and innovation that other so-called tech experts often overlook.

In today’s essay, Jeff shares his insights on a tech investment sector that’s set to skyrocket… one that he calls “timed stocks.”

“Timed Stocks” Are Going Into Overdrive

By Jeff Brown, editor, The Bleeding Edge

I sat in my office on the 24th story of a skyscraper in Tokyo. Dusk was settling in, revealing the lights of the beautiful skyline. It was 2011. I was the president of NXP Semiconductors Japan at the time.

I looked up from my computer and took a glimpse of the rainbow bridge lighting up over Tokyo Bay.

Suddenly, my chair started to oscillate gently up and down. I looked over to one of my staff who sat near me, and we had a chuckle. Earthquakes are a normal part of life in Japan.

And then it hit. The big one. A 9.1 scale earthquake that shook the building to its core.

The 15 minutes that followed were the worst I’ve ever experienced. The building felt like it would snap.

We’d swing three or four feet in one direction… and then shift back in the other direction just as far.

Books and binders were flying off shelves. The walls were cracking. Some of my employees were lying on the floor crying. Across the bay, we all stared in amazement as an oil refinery exploded into flames.

I moved as quickly as I could through the office, hanging on to anything that I could. I was pulling employees away from the windows. If the window cracked and shattered, the pressure change would have sucked them right out to their death.

I pulled everyone into the center of the building and explained that it was designed to bend just as it was doing.

Once everybody was safe, I called my CEO. I told him that there would be massive disruptions to the global semiconductor supply chain and that manufacturing plants would be badly damaged across Japan.

I told him to quickly secure product and materials inventory before everything dried up due to a halt of production. I told him a massive tsunami was coming as well.

He didn’t believe me.

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Of course, we know what happened. Nearly 16,000 people died from the earthquake, the tsunami, and nuclear meltdowns. And this disaster ushered in the worst crisis the semiconductor industry had ever seen.

I’m telling you this story to make an important point. When faced with a society-altering event, we must react accordingly.

In the wake of COVID-19, our society has been forced to change. And as investors, we must learn to adapt as well.

This Tech Sector Is in Overdrive

Let me say upfront that things are absolutely getting better. There are plenty of reasons to be optimistic. We now have multiple COVID-19 vaccines available for emergency use. And there are several effective therapies, like Eli Lilly’s antibody treatment bamlanivimab, in our tool kit as well.

But while the world has been getting COVID-19 under control, many industries have been suffering.

Hotels have remained nearly empty. By and large, cruise liners are still sitting dormant at their ports. Rental car agencies are facing tough times as well. This certainly hasn’t been the time to invest in the hospitality industry or in any companies that depend on consumer travel.

However, that doesn’t mean that there aren’t incredible investments to be found in this environment.

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And there is one area of the technology markets that is in overdrive.

In my nearly 30 years as a technology analyst, I’ve never experienced a time when this industry was as elevated as it is right now.

Every venture capitalist and private equity house has just woken up to how powerful these technologies are and how quickly their stocks can move.

And here’s the important part…

Companies in this sector aren’t affected by supply chain problems as a result of a worldwide lockdown.

They don’t care if the market is volatile. All that matters is that they make progress on their research and development. And when they do, the stocks run higher.

In fact – as history shows – some of these stocks are nearly immune to shocks.

For example, in the downturn of 2008 – right smack-dab in the middle of the last crisis – three stocks in this sector rose by 84%, 108%, and even as much as 382%.

More recently, in the last week of February 2020 – one of the worst weeks for the market ever… only seven stocks in the S&P 500 showed positive gains.

And the two biggest gainers? You guessed it. Both came from this same sector.

We’re seeing an acceleration in investment in this area, too. More and more of these early-stage companies will hold initial public offerings (IPOs).

Unlike the overhyped, overpriced tech IPOs we’ve seen recently, these “forgotten” tech companies do things a little differently…

Early-Stage IPOs

Lyft was the one of the attention-grabbing IPOs of 2019. This was a “hot” company that investors were chomping at the bit to get a piece of.

What few retail investors considered, however, was that Lyft was nearly eight years old when it went public. It went public at a $24.3 billion valuation.

For comparison, Amazon was valued at just $438 million when it went public in 1997. That means that Lyft’s IPO valuation was 5.5 times larger than Amazon’s.

And there was another problem. The company was hemorrhaging money like a small-cap firm. In 2018, the year before the company went public, Lyft reported losses of $911 million.

Even now, almost two years later, anyone who bought Lyft at its IPO is down more than 20%.

This is the problem with buying overvalued, overhyped IPOs. They are almost always a bad investment.

That’s not the case with this technology sector that I mentioned above. These companies still go public early. Very often, they are the same size as Amazon when it held its IPO.

The potential return from these early-stage IPOs is exponentially higher than anything we will ever see from IPOs like Lyft.

And I believe these investments will be one of the best ways to profit in 2021.

What precisely are these stocks?

They go by different names. But I call them “Timed Stocks.”

That’s because, thanks to the federal government, these stocks have a preset “timer” attached to their share price. Once a timer hits zero, the stock can skyrocket.

And thanks to two forces, these stocks are entering a “final countdown” period.

More of these stocks are coming onto the market. The gains are larger and are happening more frequently.

The investment potential here is unlike anything I’ve seen.

That’s why I’m inviting to learn more about timed stocks by joining me on Thursday, March 18, at 8 p.m. ET.

On that date, I’m hosting Timed Stocks: Final Countdown, a special investing seminar where I’ll reveal everything I’ve learned about these stocks… and share details on the No. 1 Timed Stock on my list.

Go right here to reserve your spot to attend. I’ll look forward to seeing you there.

Regards,

Jeff Brown
Editor, The Bleeding Edge


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