Spotting Breakout Stocks: 7 Essential Strategies for Investors
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On radio, on youtube, streaming live, on invest talk dot com and for our podcast describers, this is invest talk, independent thinking, shared success. Investor k is made possible by K P P financial, a registered investment advisor firm serving clients throughout the united states. Here is K, P, P, financial portfolio manager. Look, gero.

Good afternoon, fellow investors, and welcome back to invest talk when I was lucon and is friday, is not thursday, is friday, november eight, twenty, twenty four. Now before we head off for what I hope is a relaxing weekend, which I thinking, know what, we all deserve a relaxing weekend.

We have some work to do, and we will dig in to what that work is, what the stories are that I brought for you today, what the effect of stories may have on the market in the weeks to months, the years ahead, and how that all can affect your strategy for investing and achieving your financial goals. But most importantly, hoped here from you. Now we have questions ready.

We have voiced mental questions. We have youtube questions, but we prefer the live ones. And hopefully we have some of those today. IT was just a bit we're going to talk about today's market performance and run down those show topics, but let's tackle this colour question now.

Hello, and just talk. My name is a brian. I'm calling from ohio as wondering if you could go over the stock western union.

W. U. I always like to listen to the program. thanks.

So western union ticket a dw u is a lender money transfer service um primarily they they do money transfer and payment services IT essences like a hard payment transfer service, right? Not thinking about your venues, your payout, but it's been around for an incredibly long time and it's pretty big producer of cash flow for the size of the business.

The margins have a slipped since twenty twenty two, right? You're in you're seeing the ebt margin falling from about twenty three percent back in twenty twenty one, down about seventeen point six percent this year. Net margin following as well from twenty percent twenty twenty to do about sixteen is what's projected to be this year.

And a big part of why this stock is at a rough time since really middle of panna mic sales, every phone, right, there's going to rise in digital money transfer service is making IT kind of disrupting this industry as a whole and moving away what was the old and integrated company. Another issue here is, well, management here has made some questionable capital of occasion decisions. They have sought out mergers with existing digital platforms that have not really pained out.

And so in spite of the cash flow, in spite of also richer in and capital shareholders, they went from about four hundred and twenty million shares outstanding back in twenty twenty, down about three forty. Now it's pretty solid. But I mean, the divided build is eight point seven eight percent for a reason, right? IT hasn't been underneath, you know, six point eight percent cents before twenty twenty two.

We look at this market wide under performance. This industry wide under performance is going back through the pandemic. And so for that reason, you know you may look at this and say, oh, it's trading at six times for looking earnings yeah that looks cheap.

But but it's not right. This is a company that is producing casual, but there's no growth, are questionable management decisions. It's continue to under perform and IT likely will continue to under perform in the future.

So for western union taker, W, U, gone to have to pass on that one. We ve got a lot of grown to cover in the next forty five minutes or zone. Here's a little bit of what I have planned for you.

My main focus point concerns at this topic, spotting, break out socks, seven essential strategies for investors, moralizing competitive advantage to tracking market trends and moderate volume patterns. Investors can learn to spot the next big winner will also touch on how Christmas is coming early for many industries. Anytime there's a new administration that comes into place, it's time to put together your wish list. And that is exactly what wall street is doing. So will talk about how we how wall street would like to move regulation from the c and bank capital requirements.

Also talk touch on the markets and interpretation of paws comments earlier in the week what the feds next move could be and what really that's going to depend upon and should be if time at the end of the show will touch on china, who another pretty large debt package to help local local municipalities in what has been for some time is struggling economy, but really no direct capital stimulus, no direct injection. So we dive into that. Should we have time at the end of the show, we have voice, big questions to play, let you want on a loomin technologies L U M N.

And some questions that came in from the comment section of the invest talk youtube channel. And of course, I welcome your friends and investing questions now or any time throughout the show never headed into a break. And on the other side will talk about today's market activity.

By the way, we did IT or really you did IT, we all hit the sixty million download mark on a wednesday nights. Thank you. Please remember that you can call any time and leave your questions on the invest talk voice mic eighty eight and ninety nine charge.

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Stock about the market today. U. S. Stocks finished higher and what was really uneventful trading coming off a well event for week, the down up fifty nine basis points.

S, M, P, five hundred and thirty eight nastec up the nine basis points. Rusal, two thousand small caps, up seventy one. Now that peace, that fresh, all time highs, major to sees, all notching big gains on the week.

Our performance included airlines, trucking and d, regional banks, home builders, hotels, looks like under performance, cmos, energy, destrier, precious metals, chemicals, not fearing all the day, though there weren't many strong under performers on the day. Dollar stronger on the day, up forty basis points. Gold finished down forty basis points.

Cruelle settle down. There's two point seven percent today. Copper slightly lower at two point eight percent. Just beaten, beaten, cruel, il down, quite finished. Like I said, what was a pretty busy week.

The markets been underpin primarily by this unwinding of election related hedge, right? You've seen that in the retreat of the vicks. You're also adding on favorable seasonality, and all these things are pushing the market higher.

Some concerned about tariff implications, though hidden within the noise for for both growth and inflation, how a widespread terrorist could could reduce growth expectations in the next year and bring back a little bit more inflation than I think people would be comfortable with. A preliminary university of mission and consumer sentiment beat as well highest it's been in six months. One year inflation expectations ticked IT down to about by about ten basis points of two pots, six percent that nothing really meaningful.

IT is the lowest number since december twenty twenty, though, though the long one ticked up about ten basis points. All all marginal changes there in terms of bullish news this week, quick and clear decisive election outcome is always good because we say this all the time. Markets uncertainty, even if there's uncertain ty about policy at least, is a certainty of uncertainty in IT deg.

Regulation and ema ares definitely taking a hole here as the regulation path changes heighten probability of the red sweep, brought corporate tax cut likelihood more into play. That could potentially boost um potentially boost uh S M five hundred E P S by about four to five percent on the bear side, trump in expected to ratchet up global trade uncertainty given long standing terre threat. Uh well street expect that should those terms go to place a good way on GDP growth and push inflation, terrific expected to hit U S.

Consumers with the f estimating probably forty six to eighty billion dollar reduction in annual spending power broadly among the U. S. Consumers likely sweep keeps the fiscal deficit cusic concerns and play the committee for responsible federal budget estimated that the plan as proposed, could add seven and hf trillion to the national debt that could rise up rather raise up long and borrowing could also det the fed easing cycle cleaning claims hides since every every twenty twenty one.

That certainly good news for the bears. And overall, a external to the united states internationally, it's a little bit of political uncertainty in germany. The rule in coalition could be collapsing in germany.

Being front line of the european economy could have ramifications at home here as well. Looking ahead to the next week, tuesday brings the N F I B small business sentiment in the fed senior loan officer survey october CPI the highlight on wednesday. While ppi hits on thursday, retail sales and prior manufacturing and industrial production are all out on bright day. It's like we have our first live call. It's got Andrea california, who is a question about economy numbers.

Hey, how are you good? How are you good? Thank you. I just that this is I had when to run to pass you um I subscribe and now I hope this is okay to say his newsletter, john Williams, john win shadow steps he's been around for a long time, is a older gentlemen use the word for CoOperations where where they actually had to know what the real numbers word and he puts out in alternative sats s for A C D I unemployment, exeter inflation and ah the numbers that come out of the L S.

They should be called the B S because they are while the understated or overstated, depending on what the government wants out of us. So um my this is is that this is why the ed can never nail IT because they're using statistics that are not accurate and and and to say that they are is disingenuous ous at best to pretend it's like pretending that you believe it's like the tooth fairy yeah we believe in the tooth fairy. Well, it's it's it's not true.

And and I just wanted to get your thoughts on that again, i'm not being antagonistic. It's just IT is plainly obvious that the numbers that come out of the government are the way they want them. They're not accurate.

Of course, wall street will use those numbers because that's what people believe. okay. Well, you know.

here here's the thing, right? The beer of labor statistics, reports, baskets of things. And you can say that OK CPI is not representative of inflation.

I meant that could be true, right? Representative of what we are feeling when we do costs, right? The methodology can be a little bit secured as well.

why? Well, you look at the lag effect of rents, rent or twelve months average. Is that representative of our housing Prices are going now? Is that representative of stable or changing rents? Doesn't give you an accurate picture of, again, what american consumers are feeling.

So you can hear OK inflation is only at two percent, right? And you're say, OK, well, I am spending this much of the grocery store. IT doesn't define your experience of what you're getting at the grocery store, but that's not really what inflation in aggregate is.

And so yes, these numbers don't compute with most american consumers because it's not purely describing your experience. There's a lot that goes to do IT. There's tens of thousands of things.

They go into inflation. There's a lot that goes into a lot of this data. And Frankly, the fed doesn't even use CPI.

They use PC. They use a future figures that we don't even really pay attention to. And the reason why they can really get IT right is it's pretty darn hard to move this ship.

The us. Economy is an absolute behemoth of the thing. There are many things that pushed the dollar around.

For example, you have interest rate parody between between cross currency trades. You have baLance of trade between countries that is moving demand for dollars. That being said, again, you can say the numbers are cooked, but I don't agree.

You can say that I think a Better way to put IT is the way that numbers are perceived are not how I experience them because we have been talked to think about inflation and related to things in our lives. But the inflation data that comes out, the inflation numbers that come out, aren't really meant to describe the experience of the individual person out there. Does that make sense?

IT does. But just to push back really quick on one point, if I could, 是 inflation is hard by the government。 One hundred percent people that say it's caught by Price gouging is is wrong.

And inflation is inflation of the base currency. It's solution of the currency is caused by the government. It's a tx on us and they are causing IT and and that's why they cook the books. So you can call me a conspiracy three or what. But I I disagree with .

you if you that's that's that's entirely that's that's entirely fair. That is entirely fair to disagree with me. This is this is a free country where we're able to disagree with each other.

Baseline economics tells you that inflation is caused by cost pusher demand pull IT can be caught by printing money, right? Printing money, putting money in the hands of people, is what pushes things on the demand side. I agree with you, the government can cause inflation that way.

The other way you can cause if inflation could be caused, is with supply changes, you don't have as many goods out there to meet the demand. This is a story that can last for hours. The conversation can last for hours.

I love IT when you are call in. I love IT when you all are opinionated. But either way, we have to go to a brakes of. Thank you on ray for giving a call. We love to hear from you all, paul, from palm desert. I hope you're so hanging on because you are next when we come back with them as a break still to cover in this podcast and radio shown on A M twelve twenty. Let's like a more of your voice and calls and get T, V, main focus points to stay with me.

Every investor is working to build a secure financial future. The more you learn about how the market works, the Better your chances for success. Investor eighty .

eight .

ninety nine chart paul from .

palm desert. Thank you for waiting. You've a question about J. P. M you all did.

Do you looking to buy IT? I owe IT and I just wanted to get your take on valuation maybe and maybe if it's time for me to to take some profit after more than doubling the last two years. Um what do you think?

Well, you know, I like to say from time to time that nobody, everyone went broke taking profits.

So I think that's always a good idea, especially after this run up, especially given kind of the positivity from the banking sector broadly headed into next year with a new administration that is likely to maybe reduce capital requirements, maybe allow more merger activity, stuff will actually, i'll talk about with one of the stories we have for you today. But let's been in this. Jp, more.

IT is the largest bank on planet earth. IT is a very, very, very large company. They have a very strong baLance sheet.

They are fundamentally sound. They touch about every aspect of the us. economy. And they recently released earnings. Lot of banks released earnings and they're pretty drop.

And so they have a bunch of cash on their baLance sheet, a lot of cash. They have a lot of debt as well. But you know, it's a banking business that outgoes, the cashflow has been improving.

The profitability has been pretty solid as well or net, net interest income has been growing at ten percent analyzed over the past five years. Now over the past three years, a lot of that due to the rise in interest. Its so there could be some issues with margins due to interest strates falling, but maybe they are falling as much as we think they're going to fall.

And I think the core driver of banks going forward could be the ability for them to take on well more risk than they have been able to take on honestly since the financial crisis. So I would say J. P.

Morgan is a very strong company. Uh, there's a reason why IT is such a large bank that has been so successful. They pay really solid dividend is consistent if you're going to own a mega bank.

I think this is the one to do IT. But you had a crazy run up, you know, over the past couple years and it's into the territory of long term capital. IT may be time to to look at IT and think about rebounds ing a little bit, but I certainly wouldn't sell out of all of IT.

That's so good and good. Appreciate your your insight.

Us have a wonderful day. Shift years over to our main focus point today, which is about how to spot break out stocks. So let's dive in.

And in order to dive in, let's first talk about what you break out stock is break out stock is one that surpasses a support or a resistance level. So break out doesn't necessarily mean it's a good time to bye, right? IT could be breaching support. IT could be headed down. So break out just means it's moving away from its usual band over which it's been trading for a period of time.

And these levels really represent Price points to stock struggles to move beyond a break out was when is often viewed as a strong indicator that the stock stock may continue in a particular trend, right? IT doesn't say it's going to go up or down, is telling you that the trend that may continue in the direction that IT has decided to move. And so the question becomes, how can we find when breakout stocks can be potential winners? And here are seven ways that you may be able to spot these winners.

Person foremost is focusing on break out companies with a competitive advantage, patented technology, strong brain recognition, unique business model. These can all give a company an advantage over its peers, which increases the chance that the break out will continue along that trend. Secondly, we want to look for key market trains.

You want to stay up to date on these trends because they can help you identify not just stocks with sectors that have outsize growth potential. Thirdly, flow dynamics. And you want to monitor to the volume of the stocks, the Price movements of the stock because breakout socks often see a surge in trading volume, and that signals increased investor interest going forward.

This next one really important because it's not just about the trends and stocks, right? Technical things can only get you so far. We care about fundamental.

So we need to focus on companies with strong fundamentals, look for indicators like increasing revenue, increasing margins, Better profitability, growing profits, positive cash loves. All of these things show companies with solid fundamentals, which are more likely to experience sustained upward movement. The first strategy is looking to soccer relative strength.

This is just talking about momentum, right? Compare how a stock is doing to a sector, how what's doing to the specific appears within that sector, how is doing relative to the overall market over various time frames break out, socks often perform both. I perform both the market and their sector, hinting IT further growth potential.

Number six, keep you out for a catalyst. What are catalyst? Will cattle the developments that may drive stock Prices higher think successful product lunch or a favorable regulatory decision? And maybe is a merger on the horizon positive earnings surprises, where even upwards earnings revisions can also act as strong catalysts? Finally and most important, weird, definitely in the top three.

No, when to exit, once to stop reaches your target Price is why is to take profits. You don't need to exit fully, but start to take profits. Many socks that break through resistance levels often retreat soon afterwards.

When the time comes, move on, seek the next opportunity. So though identifying break out stocks isn't easy, these strategies can give your porfolio an edge, focus on companies of strong fundamentals, compare the strength to the market, and prioritize those with the competitive advantage. These are just a few ways to profit from break out stocks boys to rise past their resistance.

Now the next invest talk will look into this topic, how to accurate value real state. Three provin strategies for investors remain realizing comparable sales to estimate construction costs and future income potential. They're techniques that offered powerful insights into real estate evaluation. That's monday, but phenomena grown and ready to take your calls at eighty eight and ninety nine chart. I would like to know a more .

about the company, which I ve been tracking for sometimes.

Look, gero is here and ready to tackle your questions.

And I was just wondering, are there any investment account to a different banks that you would recommend something that.

that may offer a good resources? Don't forget to call the eighty eight ninety nine short.

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The numbers are in invest talk now with more than sixty million downloads. Justin klein and luck aro are ready to answer your finances investment questions twenty four seven investor eight eight, eight ninety nine chart Justin .

calling in with the question on this stock lumen technologies the symbol is L U M N I currently hold some shares and I purchaser at eleven dollars and now it's shot up and just wanted to see the gods are whether IT will be good to continue to hold or is time sell. Thanks for your show and to be listening to the answer that.

Thank you. So ticket L U N N lumen technologies is a communications company. They have a bunch services, right? They Operate through networking, through cloud security, collaboration services.

And so taking a look at this company is fundamental. Its baLance sheet is a nine billion dollar market cap company with a whole lot of debt, eighteen billion in death. That means an interest coverage ratio based on its most current quarterly earnings point, three six.

So over those you who you know, we have been explained this in a while, interest coverage ratio is your ebit, your earnings before interest and taxes divided by your interesting experience. So what it's telling you is based on your income after appreciation and immediately and all that stuff, how many times over can you pay off your debt? And the answer here is point three, six times.

And so IT hasn't made money. So it's twenty, twenty one. Cash low is falling, its profitability again falling. IT pays no dividend is short interest is in a range where IT couldn't really be helped out by squeak, but it's still something to notice about seven percent right now.

And so the reason why it's up is because they recently reported earnings and they had a decline in revenue but still a significant increase in cash flow driven by one particular business segment revenue growth paid in revenue growth. But honestly, what I see here is a company that had a Spike that has been really suffering since long before the pandemic. Company, whose sales have been falling, right? They had twenty three billion in revenue back in twenty eighteen, predicted to be about twelve billion this year.

This has been a steady fall year over year. In that same time, margins have collapsed. Cash low, although IT is starting to turn around, has still fAllen precipitously.

And all the while, they have had a lot, a lot, a lot of debt. So honestly, this looks like a company that has a lot of debt and not a lot going for caffeine. Maybe it's turning around, but it's not just about if this company will start to do Better.

It's how this company do related to others, the opportunity cost of IT. I just think there Better opportunities out there than lumen ticker L U, M, N. It's got to Richard the same in cisco who is a question about fl M X. Do you only you can invite .

yeah have a little bit of IT. Uh uh look uh my question is uh because i'm uh also asking about because we're not related F, L, M X the mexican etf and an F L I N Franklin the indian etf. My question in general is a given the outcome of the election in your talk about cfs and all that kind of thing, I know that the international exposure, though the portfolios s still important, there may be opportunity there um I know that Justin talked but you know it's the country that he one of the best countries in terms of international investing with mexico and also india is kind of get that sums up given what's the action of the election you think it's still go uh, at this point you get into those two E T S D F L M X and N F L I N.

That is excEllent. ExcEllent question, Richard red, and so we have talked about this before, right? The concept of reassuring and frenching has moved a lot of production to mexico, to vietnam, other countries in asia and to india as well.

India is an incredibly fast growing economy with the market we talked about yesterday today, which has essentially given access to far more investors in a lot of markets have. And so the number one thing that drives asset Prices is flow dynamics in india has excEllent flow dynamics as well as production growth. And so yes, give in you with both h this current administration, the biden administration, emphasis on manufacturing, no matter who had won this election, they were both pretty much the same in terms of industrial policy.

So i'm pretty certain that the trip administration with these tariff, should they put them in place, so they are not put them in place, right? I will see in the coming months who's going to actually be trade advisors and in cabin secretary. But regardless, I think that this is one of those things where these are good markets to investing no matter how the policy shakes out because of the growth, because we have been and will continue to resort in french or you shore up supply chains post pandemic, we learned are less than with some of the dangers of of globalize supply chains.

And and you're right, IT is IT is typically a good idea to invest in international markets because they offer some equity diversification. Just because U. S.

Markets are outperformed international markets in the recent past. Doesn't mean that's onna continue on into the future. So these two funds are cheap ways to get in their fl I N in india is only about ninety basis points.

Fl M X is also about ninety basis points. They have good exposure along the market cap spectrum. So I like your idea.

I like that you're looking international. And I think next go india are two good markets to do IT. I think these are perfectly fine funds to use.

great. Thanks a lot.

Yeah, thanks.

We're calling now today's .

friday and on friday, we genuinely trying to make time to fit in. A quick to run down on bench market numbers. Let me hear with that.

Listen now the two treasure yelled was at four point two five percent today. For perspective, last week that never was at four point two a one fourteen weeks back, I was at three point eight eight two. And here goes at five o five, but ten year treasury yield.

And so that was the two year treasure yield was a mistake for me. I thought that seemed weird. Ten to treasure yields at four point three o eight today.

Last week I was at four, three, six, three, ten weeks es at three point and nine, two, one and a year back is at four point six three gold's Price to two thousand and six hundred and eighty five dollars per ounce today last week that was twenty seven, thirty six. And one year ago that was nineteen thirty five. Silver was that thirty one, twenty four plants today.

Last week was thirty two, forty seven and thirty eight weeks go IT was twenty two, eighty. Oil was selling for seventy dollars and thirty eight since per barrel last week. Then I was sixty nine and sixty six six weeks ago was sixty seven and seventy nine and forty eight weeks back that was seventy four thirty.

The national average or down of regular gasoline three o nine and three cent decrease in last week, seventy five weeks ago, three fifty, six hundred twenty three weeks sales four, twenty five and one hundred and forty three weeks ago at three fifty seven california was out during four fifty one per thousand and four cent decrease from last week just over year ago that I was five, thirty two and one hundred and thirty weeks back there was five, eighty seven. For comparison, in iwa, gas was averaging two dollar to eighty five cents per gallon. That is, one dollar in sixty six cents of less per gallon than gas in california.

No, another friday tradition is briefly mentioning the newest K P, P premium news letter, which will be distributed tomorrow. In the insight section, we discussed deregulation and what that could mean for the U. S.

Economy and all of its forms. In the stock ideas section, we mentioned a casual footwear company and an oil field services company. And in the portfolio armando em section, we touch on investing beyond dividends.

If any of that, if all of that, if some of that sounds interesting and you want to learn more, visit us to invest dot dot com and subscribe for those subscribers. The news letter will come to your inbox on saturday mornings. Lot of live calls today we have another live call from sami and sam cco, who is question on smc. I do you want need you look going .

to buy IT I owe IT um in this this question I have looked on this one is um I know they're been having some issues, that accounting and all that there have been know some news on that. Uh, but what I want you to focus on is their core business and the numbers that they recently announced. So based on that water, the best of the stock at at this point um based on how draining I mean.

I someone called in um I know you want me to focus on the core numbers here. When there are accounting issues and questions about how they're classifying revenue, it's kind of difficult to look past with. The primary problem is here, I believe somebody called in when this was training IT, about five hundred, and I told them that they were accounting issues.

You should probably get rid of IT. There are Better opportunities out there within this space. There are Better places you can move within this space, within whatever theme you are investing in.

The reality is here, companies that are having accounting issues and having a weird recognition of revenue, there's just not worthy this thing could pop IT could absolutely pop, but there's outsize risks. This has been an issue for a very long time here. And Frankly, this thing hasn't really been strong.

It's that huge run up IT had in the begin of the year before was added to the s and p five, however. So I have been against this company for a couple months now. And so i'm still i'm still no on s mci.

Thanks to the call. So let's talk about regulation. The banking and finance industries are gearing up to push for lighter regulation under under the travel administration in twenty twenty five.

While stress is a unique opportunity to shape policy and various trade groups are really art crafting these wishlist that happened with every administration for regulatory relief they're going to present to the trump transition team. One of the biggest asks from the banking sectors, the roll back of the proposed basel three and game rules. These rules would require large banks to hold more capital to minimize risks.

Banks have been loving regulators for months, and then now hope that a new administration will revise or start fresh with these rules. Additionally, banks are seeking relief from fair lending regulations, simple stress test and an easier path for bank mergers. Also keen interest in tax policy.

Many of trust tax provisions that he proposed for that he that he enacted rather in the first german or said to expire in the finance sectors, pushing to maintain lower corporate tax rates. The private fund industry particular is looking to keep favorite tax treatment for Carried interest, allowing you to be taxed as high as capital gains rather than an ordinary income. And so trump's transition team has, I would have been more proactive this time around than the first time around in reaching out to these industry players and asking for insights not only on policy changes, but also on potential appoint ties to regulatory positions.

And so this kind of suggest that maybe we see stronger alignment with industry objectives then we saw during the first term. Still new regulatory leaders may be installed immediately. As as top cabinet pointed, ser are expected to really take presidents in the senate confirmation progress. One group, the alternative investment and management association, is pushing for a more collaboration relationship between industry players and regulators because over the past four years, it's kind of adversarial. Private funds save R, T, chAllenged the sec rule making efforts in court, scoring a significant win this year with overturning of some major sec rules.

Industry raps hope for a more friendly environment marked by the traditional mural making process and and proactive engagement within the industry, rather than taking an adversarial stance from the get go for walk in the finance sector return, a lighter regulation could really be a game changer, opening pathways to increase growth and profitability and reduced oversight. Though IT does Carry lots of risks, whether not these hopes become reality depends on the political landscape heading into next year and the decisions made in the washington in the coming months. Go head and roll in another fresh listener question now.

Hi ohio, to take on a Daniel M A D M because its earnings and um it's a small cap, twenty five billion dollar market cap picture of things. And I know like a long term play on IT and I know have some accounting issues too. This should be a goodbye to get into the closed like fifty two dollars. Thank you. I'll ve been listening.

So archer, Daniel midleton, that is ticker. A dm is a processor and trade of agricultural commodities and the manufacture self food and feed products. And so they recently reported earnings q 3 earnings outside the recently postponed q three earnings because they needed to amend some reports because of some changes to their to their accounting。

And I mean, it's it's a big company is one of the leading players in the in the global grain processing area. It's a twenty five billion dollar market cap company. They have a little bit of debt, nothing too crazy, about eleven point eight billion dollars in debt, cash low.

Looks like IT isn't proved pretty well over the past couple years. Now here to date, they're done about twenty seven percent, i'm sorry, yeah, twenty seven percent, twenty seven percent as well on the one year time frame and the revenues fAllen over the past three years. That certainly not something we like to see.

Their net income also fAllen, their margins fAllen as well. And without this happening, while the Price rings trading at ten times there, five years of twelve point six Price book, about one point one. And so let's take look at their their geographic breakdown of the revenue to before you make a decision here.

So like forty percent from the united states, twenty one percent from so what it's pretty diversified in areas that are rubbly unlikely to be heavily affected by trade policy. And so I think the big problem for me here is, one, i'm uncertain how these companies production processes would be affected by immigration policy changes. That certainly a big factor that could be wang down on this year.

But aside from that, we just have a situation where growth has fAllen off. Cash flow is improved, yes, but profit margins are slipping as well. And in this time, we've also taken on about two billion more in debt in the past quarter.

He pays solid, divided about three point eight one percent dividend. That's about within the range of the past five years, the divided percie has also grown as well. You know, honestly, I think this is a situation where revenue has fAllen off, growth has been stalling a little bit.

The valuation seems probably about fully valued the dividends attractive. But from a long term potential, we're even a short medium term potential. I just think there's other places to put your money.

There are a little bit more exciting. We're looking for dividend that is solid and sustainable. This could be the company, but not a lot of growth over the past couple years makes the call.

But can I look around? We have a one goal here to help you achieve your financial freedom. Our continues after this break, our final break before the weekends to get your questions in now at eighty ninety nine.

Look, barro is here and ready to tackle your questions.

I wanted to pick your rain about apple. What do you think about the earnings call time .

to add to my position? Eight, eight, eight, ninety nine chart.

The weekend is here or almost here, but you've got finance and investment questions, so step up and call in K A ninety nine.

We haven't done IT yet today, so it's dip into the invest talk youtube channel comment section questions. And this one came in from corne, cory, both of those spell of the k, and it's on foreign stocks, IT says.

I have very little exposure to foreign cks, but I think at the coming months, IT would be a good idea to start picking up some specifically chinese stocks if trump gets his way with the terf increases in china is going to be making a bottle of money from the us. Okay, so let's dissectors. So if U.

S. Imposes caps on china, then the cost is pushed on to importers. So U.

S. Companies in the U. S. consumers. So china isn't gonna make any money from the U S.

If U S. Imposes terrify, that's i'm not sure about that. But as I about chinese stocks broadly, right, we talked about IT earlier in the week. The china economy is in a weaker position.

Then I was in the last time, the retreat tensions, right? That's why I think that even if we were to impose terrify on china, they would be unless of a position to retaliate in the same, whether they did before, if you were call in twenty, twenty, seventy, twenty, eighteen when we impose tariff s uh, IT did cause the cost to farmers, right? The government ended up paying twenty eight or thirty billion to build out some farmers because of IT.

But I don't think that given the economic position that china is in right now, now fragile, the economy is that big and really fight back as much as they could back then. Now another thing here is it's important to note that one of the campaign promises of the U. S.

House candidates was to remove most favorite nation trading partner status with china right back could also affect the chinese market. Think I read a story about them talking about how how to go through with that early in the next congressional session. And so I ve been to be pinning for a while now that investing internationally is a good idea, but that the chinese market is didn't look as attractive to me as IT has to other people.

I think give in the election outcome, I tend to hold that position even further. So should you be getting explosion to forests stocks? Yes, I do not think china is the root to go down, at least at this time until we get some clarity on, well, a whole lot of things.

Lately, before we head off, I want to talk about the federal reserve because the future path rates is now clouded with uncertainty. There is a the first cut rates by quarter point meeting expectations following another half point cut in september, but already markets are reducing bet that another rate cut will follow in december. Fed funds futures now applying only about a twenty five percent chance that rates will stay unchanged at the december meeting, up from just a fourteen percent amount.

The cup for the out, the outlook is even hazier. For example, at september meeting, the feed rejection showed that by the end of twenty twenty five, the target policy rate would drop to somewhere between about three twenty five and three fifty at three point two five and three point five percent, down from its current range of four point five, four point seven five. There have been pretty significant easing is expected, possibly including one more rate on in december in several more next year.

However, fed watch data now shows the probability of a quarter rate point cut or less by june twenty twenty five, and now seventeen percent of from zero at the time of the september meeting. At thursday is press conference, fed chair Powell hinted that the economics outlook might be brighter than anticipated. He pointed a strong job growth, healthy retail sales and recent revisions of government data, which is that is that some downside risks to the economy maybe lesson.

But next year outlook brings in a new factor, right, the policies of a new administration. And so how emphasize that fiscal policy changes like tax cuts, right, IT take time to go through congress. And when you cut taxes, IT also takes time for the economy to feel the impact.

It's a longer, medium, longer term change. But some policies such as terms or adjustments to immigration enforcement, mass deportations, could come through executive action, right? IT doesn't require your legislation and that could impact inflation, that could raise inflation expectations, that could tamp n down economic growth.

But I could do that in a more short time frame than what legislation does. And so for the fed, what this could mean is grappling with a resurgence of rising costs and a potential growth slow down, at the same time already seeing more shifts and financial conditions rising. Bony's els, an example of this.

And so these changes can impact the economy long before any tax bill comes in to lot. The fed has some of the pressure and markets with the total rate reduction of about three quarter points so far. But how much further relief is on the way and when IT can come is very difficult to predict.

Nero, this completes another investor program. We thank you for listening, and we encourage you to tell your friends and family members about our free pocket downloads. Give yours at itunes.

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