ERShares In The News

As Covid vaccine sales are in the rearview mirror, what happens to Pfizer?

There are a few major catalysts in the next few weeks. CPI doesn't emerge until mid-July and the next Fed meetings are toward the end of the month. Meanwhile, Q2 earnings won't start for at least a few weeks, and trading volume will be low. However, this does not mean that markets or stocks will be trading flat for the next few weeks. Given the large run-up among a handful of mega-cap stocks, it would not be surprising if some investors decide to take profits. Consequently, we believe there is a very real possibility that mega-caps (e.g. TSLA, NVDA, FB, AMZN, MSFT, etc.) will underperform the broader market constituents. Long-term interest rates are still relatively low and the economy has been (surprisingly) resilient. If CPI comes in low for June the Fed may pause (again) during their July 26-27 meetings. This could help set the stage for a second-half 2023 Market rally.

Eva Ados joins 'Power Lunch' to discuss the Performance & Prospects of Oracle and Biogen

Despite recurrent themes of impending recession and global contraction, the stock market, led by tech and high-growth organizations, have rallied to their best performance in years. Entrepreneurial stocks, such as Nvidia, Meta or Draftkings have soared more than 100% YTD. Nagging concerns of continuing Fed rate hikes, Government debt ceiling/default and regional bank problems may impede the overall advance in stocks, but at the same time, 2023 appears to be a classic "stock pickers' market. Thus far, a handful of stock winners have provided exceptional rewards for those who have chosen wisely.

Eva Ados joins 'Power Lunch' to discuss DraftKings and the markets.

An old adage, of "Sell in May and Walk Away" might not apply this year. Notably, as Market Bears have predicted a recession and rising unemployment in 2023, the stock markets have kept moving higher. As of this writing, the NASDAQ Composite is +18% ytd and an Index of Entrepreneurial companies (ER30TR) is +26%. This performance is already well beyond a typical year. The reason should be clear: long-term interest rates have been dropping.

Eva Ados joins 'Power Lunch' to discuss the Performance & Prospects of McDonalds, Medtronic and First Solar

Eva Ados spoke about GE, Macy's and Chevron. She mentions that GE, which in 2000 had a Market Cap of $600B, and celebrated the highest market cap company in the world, has since dropped 85% and is now a $100B market cap company. During that same time, Microsoft soared from $300B to over $2 Trillion (6x to 7x) and Apple appreciated from $5B to $2.5 Trillion (500x return)! Meanwhile GE is still stuck at 1997 revenue levels, and has lost its edge since Jack Welch left the firm. The company is experiencing a 5 year high for its stock price and Ms. Ados recommends taking (recent) profits off the table. She also spoke about Macy's and informed viewers that this stock price is at the same $20 price level as 1997 and the same revenue level as 2007. Again, she recommends selling this stock. She concludes with comments discussing OPEC inventory cuts and the effect on oil companies and inflation.

Recent claims of the banking crisis in 2023 being comparable to the 2008 crisis are inaccurate. Unlike 2008, unemployment is low, consumer debt to GDP is lower, and corporate bankruptcies are at a 20-year low. The 2023 banking crisis was a result of the US Government selling bonds early at a loss and not due to weak credit.

The recent banking crisis has created a dual market environment with diverging ramifications among varying credit risks. The Fed has made clear that the banking crisis might result in tightening credit conditions that could potentially take the place of 1 or 2 future rate hikes. As a result, low credit quality companies (e.g. B+ rating or below) are experiencing stock price drops (-6.5% in the past two weeks) and widening yield spreads (up to 350 basis points for junk bonds), while higher quality credits are experiencing stock price appreciation. The show mentioned EntrepreneurShares ENTR ETF as a top performing fund YTD (Note: past performance is no guide to future performance), that has been a consequence of many entrepreneurial growth companies performing well in these complicated markets. Dr. Shulman ends his comments by noting that he believes Markets will move within a range bound range until the next earnings cycle and CPI readings on April 12.