Is It Time To Bottom Fish?

These companies are getting too cheap to ignore You are receiving this message because you have visited Daily Picks 365 and requested to receive daily market updates, If you no longer wish to be contacted, please click the removal link [here](. [Time to Bottom Fish? 2 "Strong Buy" Stocks That are too Cheap to Ignore]( [Click here to read full article](. Considering the tough macro environment and its impact on the markets, investors can be forgiven for some indecision when it comes to choosing stocks right now. But there are clues, hints that will point out the right stocks, even in an unsettled market. The simplest move, of course, is to look for quality stocks that have fallen sharply in recent months, down to bargain-level prices. The adage is ‘buy low and sell high,’ and fundamentally sound stocks that have fallen 50% or more in less than a year are prime targets for such a strategy. And the prospects for selling high later may be better than the pundits have been predicting, according to BMO’s chief investment strategist Brian Belski. “From our perspective, market prognostications have become increasingly academic this year with many choosing what we believe are the ‘easy’ and ‘scary’ options. For our part, we have learned that hardly anything has been textbook or easy the past few years for US stock market performance, and that is something we do not expect to change in the coming months either… we truly believe that stocks can and should rebound from current levels,” Belski opined. Quantifying that potential rebound, Belski believes the S&P 500 can see a gain of 20% in 4Q22. Aspen Aerogels, Inc. (ASPN) We’ll start with Aspen Aerogels, a firm that has specialized in aerogel insulation materials for the last 20 years. Aerogels use a liquid-filled internal pore space, filled with gas, to create an ultra-low density solid purposed as high-end, multi-use, light-weight insulation. Aerogels are capable of retaining their structural strength and integrity in combination with low thermal conductivity ratings. The company’s aerogel products are used in a wide range of sectors, including construction, petrochemical refining, liquid natural gas storage, and even in the manufacture of electric vehicle battery packs. A high-end product with such a wide range of uses makes for a solid sales foundation – and Aspen has seen rising revenues for the past two years. In the last quarter reported, 2Q22, Aspen showed a quarterly revenue of $45.6 million, up 44% year-over-year. At the same time, the company runs a quarterly net loss – typical for cutting edge technology firms – which expanded y/y in 2Q22 from $6.7 million to $24.1 million. Aspen’s pattern this year has been a combination of rising revenues, deepening quarterly losses – and a declining share price. ASPN shares are down an eye-popping 82% this year. Meanwhile, the company has been working recently on development and optimization of its PyroThin aerogel products, a lightweight, fire-proof thin insulation with potential applications in the EV battery market. The EV market is at the center of Canaccord analyst George Gianarikas’ view of Aspen’s path forward. The analyst writes: “Aspen’s aerogel materials are compatible with ~80% of EV battery architectures that opt for pouch/prismatic battery cell designs – presenting a lucrative market opportunity as OEMs transition to EVs. Today, Aspen has contracts to supply its PyroThin thermal barrier to GM and Toyota with ~$3B in potential program awards through 2028. We also estimate strong interest among other auto OEMs and expect additional contracts to be announced over time.” Marvell Technology Group (MRVL) Next up is Marvell Technology, another tech firm, but one with a very different bent and niche than Aspen. Marvell is a maker of silicon semiconductor chips, and markets its products in the automotive sector, where they are used in autonomous vehicle systems; in the data center sector, where they are applied to server functions; as well as ethernet networks and storage accelerators. Marvell’s chips are also used in SSD controllers. Marvell is profitable – highly profitable. In August, the company reported its Q2 results for fiscal year 2023 in which it posted diluted EPS of 57 cents per share. The top-line showed record quarterly revenues of $1.52 billion, up 41% year-over-year. Despite these gains, Marvell’s stock has fallen sharply through 2022, and is now down 55% year-to-date. We should note here that looking forward, Marvell’s Q3 guidance came in slightly below expectations – and that the company is under continuing pressure due to a combination of ongoing supply constraints and fears of a weakening macro. These current headwinds, however, haven’t stopped Wells Fargo’s 5-star analyst Gary Mobley from seeing a clear path forward for this chip maker. “While MRVL won’t be able to completely avoid global macro pressures, we believe the company is heavily insulated from the consumer weakness that has been most pronounced in the current macro softness. When the global economy does find more sure footing, we believe MRVL’s fundamentals and share price can outperform peers’ in the broader chip sector,” Mobley wrote. Mobley quantifies his bullish stance on Marvell with an Overweight (i.e. Buy) rating, and a $58 price target that implies an upside of 51% on the one-year horizon. [Continue reading article here.]( [Is AT&T Stock a Buy Right Now?]( KEY POINTS - AT&T’s Q3 earnings easily beat Wall Street’s expectations. - Its wireless business continues to grow and offset the slower growth of its business and consumer wireline divisions. - The stock is dirt-cheap, and its dividend is easily sustainable. The slimmed-down telecom giant is generating stable growth again. AT&T‘s (T 2.40%) stock rallied 8% on Oct. 20 after the telecom giant posted its third-quarter report. Its revenue from continuing operations declined 4% year-over-year to $30.0 billion, which still beat analysts’ expectations by $140 million. Excluding the spin-off of its U.S. video business last July, its revenue grew 3% year-over-year on a stand-alone basis. The company’s adjusted earnings from continuing operations increased 3% to $0.68 per share, which also beat the consensus forecast by seven cents. Those headline numbers indicate AT&T’s business is stabilizing in the wake of its divestments of DirecTV and WarnerMedia. But is its stock finally primed to rebound after losing nearly a fifth of its value over the past three months? A fresh start for AT&T AT&T’s debt-fueled purchases of DirecTV in 2015 and Time Warner in 2018, along with other smaller media companies, transformed it from a telecom company into a media behemoth. But AT&T struggled to balance all of those spinning plates. They came crashing down as the pandemic, tough competition, and other macro headwinds derailed its plans to build a media empire on top of its wireless and broadband businesses. Over the past two years, AT&T reversed those mistakes by divesting DirecTV in a deal with TPG (TPG 1.93%), merging Time Warner (WarnerMedia) with Discovery to create Warner Bros. Discovery (WBD -2.30%), divesting its smaller media assets, and selling some of its real estate. Prior to closing its spin-off of WBD in April, AT&T told investors the company could grow its annual revenue at a low-single-digit CAGR (compound annual growth rate) from 2022 to 2024, as well as increase its adjusted earnings before interest, taxes, depreciation, and amortization (EBITDA) and adjusted EPS at a mid-single digit CAGR. Those stable estimates suggested that the “new” AT&T would grow at a comparable rate as Verizon (VZ 1.75%), which didn’t pursue any massive media deals. How fast is the new AT&T growing? AT&T has now posted three quarters of results as a stand-alone company. Its mobility business, which houses its core wireless segment and generated 70% of its revenue in the third quarter, has consistently grown its postpaid phone subscribers and revenue over the past year. It’s also been locking in its customers with a low churn rate of less than 1%, while the EBITDA margins of its wireless services have been rising sequentially. 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