Today is the exact day that Marty McFly and Doc Brown traveled forward in time to in Back to the Future. What is interesting, as with the original Star trek series, is how future technology was, to some extent, predicted by the creative teams who wrote and created those movies and television series. Unfortunately, the prediction of the Chicago Cubs winning the World Series will likely not come true. However, miracles do happen.
It just goes to show you how important technology is to our lives. Of equal importance is the role that technology has played in our economy and financial markets. It is for those reasons that growth oriented investors, such as myself, seek out innovation and technology when identifying investment opportunities. Of course, innovation is not a straight line. It has fits and starts. This year it seems to be throwing a fit.
Yesterday biotech shares went back to being unloved while on the other hand, Apple (AAPL), which reports results next week, caught a nice bid. This is consistent with the market’s inability to gain traction this year on a uniform basis.
Tesla (TSLA) shares declined 6.61% after poor Consumer Reports reviews. Is there any car that reminds you more of Back to the Future’s DeLorean than a Tesla, from a technological point of view? TSLA shares are too expensive and volatile to own but I do like its convertible bonds which we own and might add to.
Speaking of automobiles, Ferrari (RACE) priced its IPO at $52 after the market closed. I put in for some stock for clients via UBS who ran the deal. Hopefully we can get some allocation.
Yum Brands (YUM) announced that it was going to split into two companies: a China based company and one for ROW (rest of the world). This is a case of financial engineering and management kowtowing to activist investors. The company’s announcement is no reason to want to buy the stock as it still has operational issues in every geography, including the USA.
After hours shares of Chipotle Mexican Grill (CMG) got hit rather hard (nearly 8%) after reporting disappointing results. The company’s same store sales were rather meager at 2.6% compared to the double digit comps that we were accustomed to see CMG generate. Earnings per share of $4.59 rose 10.6% year-over-year but missed estimates by 4 cents. We have been waiting for CMG shares to fall with an eye of repurchasing them in the lower 600s and could get a chance in the next day or two.
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Disclosure: At the time of this commentary Scott Rothbort, his family and/or clients of LakeView AssetManagement, LLC was long AAPL — although positions can change at any time.
Scott Rothbort is the President & Founder of LakeView Asset Management, LLC, a registered investment advisor specializing in high net worth private wealth management. For more information on investing with LakeView Asset Management, LLC call us at 888-9LAKEVIEW or request more information by clicking on the contact button on the top right hand corner of the website. LakeView Management, LLC is a Nevada LLC, with its principal office located in Henderson, NV and branch office located in Millburn, NJ
Scott Rothbort is also the publisher of the LakeView Restaurant & Food Chain Report, a newsletter focusing in on food, restaurant, beverage and agricultural stocks. An individual subscription to the newsletter can be ordered at www.restaurantstox.com Furthermore; Scott is also a professor at the Seton Hall Stillman School of Business in South Orange, NJ.
– Read Scott’s intra-day thoughts and comments on Scutify for which he is a co-founder of its parent company Wall Street All-Stars, LLC
– You can email Scott at scott.rothbort.lakeview@gmail.com
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