Ignore the Election. Pay Attention to This, Instead.

Earn While You Learn! ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏  ͏ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ ­ [EARN WHILE YOU LEARN! JOIN OUR FREE LIVE TRADING SESSION!]( Hello investor, Ignore the Election. Pay Attention to This, Instead. Vice President Kamala Harris’s presidential bid has dominated the news headlines, but yesterday’s trading volume was relatively low. Traders avoided major bets just before Tesla and Alphabet’s earnings results that are due today. The expectations are high for the current season, as nearly two-thirds of the 463 respondents expected corporate profits to spark a rally in stocks, according to Bloomberg’s Markets Live Pulse survey. - “This political shake-up shouldn’t materially alter the direction of the markets,” said Tom Essaye at The Sevens Report. “The ultimate direction of the S&P 500 will still be determined by economic growth.” Tom Essaye at The Sevens Report (Photo: Yahoo Finance) The upcoming tech earnings may determine the market’s fate in the next few months. Eventually, it will always come down to earnings growth. Big Tech companies are projected to post a slowing growth rate, but non-tech sectors are poised to start growing again. - “I think up until the election, markets are going to trade more so on the trajectory of inflation, earnings, the economy and what the Fed does,” said Peter Boockvar at The Boock Report. We will receive the latest inflation reading on Friday. Wall Street expects good progress, and it is unlikely to spark any volatile moves. Investors are paying more attention to the labor market since Fed Chair Jerome Powell has pinpointed it as equally important data for the central bank’s interest rate decision. Notably, hedge funds have unloaded their winners at the fastest pace since January 2021. The funds’ long-short net leverage fell to 49.8% last week, which was the lowest level since March 2023, said Goldman Sachs’ prime brokerage desk. It is often considered a gauge of risk appetite. (Source: Goldman Sachs Prime Services) The sentiment, of course, can change instantly. The earnings season will be critical to determine whether investors will keep buying. Profit estimates for the S&P 500 in the second quarter were cut by just ~1 in the last three months. The typical number was a 5% decline. So, the expectations are high with a little margin of error. - The “market is trading near highs, with full positioning and extreme concentration, suggesting that there is not much scope to absorb any disappointments,” JPMorgan Chase strategists wrote. All in all, the market is certain to get busy in the next few weeks. Profit guidance will be in the spotlight, as investors will try to gauge how well the economy might perform down the road. - “The heart of earnings season begins this week and plenty of tech companies report, which should give investors an idea of how healthy the overall economy looks through corporate eyes,” said Paul Nolte at Murphy & Sylvest Wealth Management. This Brand With A Cult-Like Following Adds New Products That Can Turbocharge Its Earnings Today’s Pick: YETI Holdings (YETI) The single most durable advantage of any business is brand power. McKinsey, the management consulting powerhouse, wrote in their book Valuation that the branded consumer packaged-goods companies are often the most profitable businesses. The reason is simple: Their brand power allows them to get away with charging higher prices than their competitors. Flush with cash, they can invest extra profits into making unmatched quality products. YETI Holdings -- our stock pick of the day -- is a classic example of a consumer packaged-goods company with an unbelievably huge brand power. YETI’s flagship Tundra 110 Hard Cooler (Photo: YETI.com) And YETI’s stock price is about to be turbocharged with their new product lines because of the simple math: New products deliver the biggest value to a consumer packaged-goods company because they don’t require much new capital. Companies can simply add new products to their existing factory lines and distribution systems. In other words, its fixed overhead costs mostly stay the same but sales are boosted from new products. As a result, its earnings per share can grow as much as two times faster than revenue. In fact, cases where EPS grows two times faster than revenue are common, according to McKinsey. As you will see in the exhibit below, McKinsey said that introducing new products to market is by far the most effective way to create value. For every $1.00 of revenue, new products can deliver $1.75-2.00 in shareholder value -- or two times bigger than revenue. (Source: McKinsey’s Valuation) Hence the reason why we believe that YETI’s stock price is poised for a monster run. YETI has introduced new product lines beyond its staple of selling travel coffee mugs and lunch boxes. Its product lines include backpacks, lunch boxes, coolers, camp chairs, dog beds, blankets, duffel bags, and so on. (Source: YETI) These are just the latest addition to a brand that has a cult-like following. Originally specializing in tough outdoor coolers for hunters and fishers, the company has made a conscientious effort to expand into new customer segments. They’ve recruited 187 brand ambassadors across 15 communities. (Source: YETI Holdings) YETI has won awards and recognitions from the likes of Wired, CountryLiving, Men’s Health and TIME Magazine for its signature product lines. They’ve even built a social following that rivals outdoor giants like Patagonia and North Face: (Source: YETI Holdings) How do you quantify “brand” financially? Through profit margins. McKinsey and Warren Buffett agree that the respected brands have pricing power. And YETI certainly qualifies. They’re growing on the top and bottom lines, with adjusted gross profit being at its highest in six years: (Source: YETI Holdings) Bottom Line: YETI Holdings is a fantastically profitable company that’s growing consistently because it built a strong brand. They also offer leading outdoor and travel products that could see even stronger demand in a post-pandemic travel boom. [EARN WHILE YOU LEARN! JOIN OUR FREE LIVE TRADING SESSION!](       © All Rights Reserved, Trade Alliance [Unsubscribe]( | [Manage Preferences](