The “Forever” Rally Continues

Earn While You Learn! ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ [EARN WHILE YOU LEARN! JOIN OUR FREE LIVE TRADING SESSION!]( Hello investor, The “Forever” Rally Continues The “forever” rally continued yesterday, as the S&P 500 scored its 35th record this year on a 0.1% gain. But it might not mean much until this Friday when big banks kick off the earnings season. The expectations are high now. Forecasts for 12-month forward earnings are hovering at an all-time high. So, Wall Street expects companies to deliver earnings growth to justify lofty valuations in stocks. Mark Hackett at Nationwide expects many companies to resume share buybacks, which could boost stock prices even further. - “As earnings season kicks off this week, investors should be prepared to see some ‘choppiness,’ but the market will likely climb back up again once companies resume buybacks,” said Mark Hackett at Nationwide. John Stoltzfus at Oppenheimer Asset Management remains bullish because of strong earnings growth and solid economic data. - “S&P 500 earnings results over the most-recent reporting seasons and economic data that has provided evidence of resilience remain at the core of our bullish outlook for stocks,” said John Stoltzfus at Oppenheimer Asset Management. John Stoltzfus at Oppenheimer Asset Management (Photo: CNBC) On the other hand, Megan Horneman at Verdence Capital Advisors warns of a potential 10% correction due to several factors that the market has brushed off so far. - “This rally has continued despite growing concerns about the economy, political uncertainty, sticky inflation and lack of clarity about timing of first rate cut,” said Megan Horneman at Verdence Capital Advisors. - “Therefore, we would not rule out at least a 10% correction in the S&P 500 in the second half of the year. Especially when we see future earnings expectations get more realistic.” Some analysts pointed out that Big Tech companies have been responsible for the bulk of the S&P 500’s gains. But other sectors are expected to pick up the slack in the next few quarters. That might bring much-needed support to the current rally. - “S&P 500 earnings growth will likely continue for the next year at a respectable pace,” said Nicholas Colas at DataTrek. “Moreover, those improvements should be broad-based rather than in just a few tech-heavy sectors. All this adds up to continued strength in US large caps.” We will get the latest CPI reading on Thursday and the earnings batch from big banks on Friday. These are expected to spark some volatility, so things could get interesting in the next few days. The “Operating System” For Commerce Makes Money 25,000 Times Every Second Today’s Pick: Fiserv, Inc. (FISV) Fiserv may be the most fantastic business that you’ve never heard of. It doesn’t get much attention because it’s the “behind the scenes” technology behind banks and merchants. - Namely, it produces the technology that banks and institutions use to move money -- payment processing, automated clearing house (ACH), digital banking, and card issuer processing. As a result, Fiserv calls itself the “operating system for commerce.” And they are not kidding. Their technology reached nearly 100% of the USA households, holding a file of more than 1.4 billion consumers. As a result, it runs 25,000 transactions per second at peak. And it does many things that consumers don’t see. For example, beside providing the “boring” technology that process transactions for financial institutions, Fiserv also does these things: - Fiserv creates a consumer recommendation engine for Adidas along with processing payments. - Fiserv runs the engine behind Zelle, the P2P payment system. - It owns the popular payment platform — Clover. - It offers “white-label” solutions for smaller banks who need online banking portals. And I could go on and on because Fiserv has over 1,000 products and services. (Source: Fiserv) Now, imagine this: Fiserv runs the “engine that moves money” for 10,000 financial institutions and 6+ million merchants, so it’s indispensable for their businesses. Switching to a new competitor will require an enormous amount of time and effort to re-tool the system -- giving Fiserv a huge competitive moat. Better yet, about 80% of Fiserv’s revenue primarily came from account- and transaction-based fees -- which means the company makes money every time money moves in their clients’ businesses. Sounds like a good business model, right? Fiserv’s earnings will do “all the talking” by posting 38 consecutive years of double-digit adjusted EPS growth! Shareholder-friendly: Fiserv loves to reward shareholders with absurdly high buybacks. Last year, it reduced the average share count by 5%. The company’s medium-term outlook is to deliver 14% to 18% adjusted earnings per share growth. Bottom line: Fiserv is a bargain at forward P/E of 28.17. With its competitive moat and share buybacks, it’s money in the bank for you. Buy and H-O-L-D this stock for dear life in the next decade. [EARN WHILE YOU LEARN! JOIN OUR FREE LIVE TRADING SESSION!](       © All Rights Reserved, Trade Alliance [Unsubscribe]( | [Manage Preferences](