Friday Charts: Crooked Politicians, “Redneck Intelligence” and Stock Market Seasonality
It’s Friday in the Wall Street Daily Nation!
That means the long-winded analysis is out. (Hallelujah!)
And some carefully selected charts are in. (Amen!)
So without further ado, check out these snapshots of the big thorn stuck in small business’ side… a “sell in May” update… and, as I promised yesterday, one of my favorite stocks to own during this economic recovery.
Move Government, Get Out the Way!
I’ve featured the NFIB Small Business Optimism Index here before.
So what does the latest reading tell us? In short, Washington is still a major problem.
Maybe President Reagan was on to something when he warned: “The nine most terrifying words in the English language are: ‘I’m from the government and I’m here to help.’”
Let’s all do our part to help Washington get the message.
Copy and paste this chart into an email to your elected representatives with a simple message (from the wise words of Ludacris): “Get out the way!”
Sell in May? Nope! How About June?
I hate to say “I told you so.” But… I told you so!
On May 1, I warned: “Selling in May and going away is not all it’s cracked up to be.”
And sure enough, the market kept on rallying. As I write, the S&P 500 Index and Dow are both up about 3%, while the Nasdaq is up about 4%.
So what’s in store for June? A little gloom – that is, if history is a reliable guide.
Now, if that has you thinking about ditching stocks to sidestep the potential selloff, might I suggest an alternative?
For instance, a stock that’s uniquely positioned to buck the trend…
You Might Be a Redneck If…
If you live anywhere in the South, you might be accused of being a redneck if you own a pickup truck. (I know, because it’s happened to me.) Chances are, though, that you’re a small business owner, too.
As I’ve noted before, small business owners account for a large portion of pickup sales, particularly Ford (F) F-Series trucks. That means, by gauging sales of F-Series trucks, we can track the health of the economy.
And there’s no mistaking the underlying trend…
Tack on the fact that sales in Europe are bottoming out, and Ford is certainly in store for an earnings boost.
My conservative estimate calls for the company to earn $2 per share in 2014, which would represent a 41% increase over the consensus estimate for this year.
Given that stocks ultimately follow earnings – and that Ford is trading on the cheap at less than 11 times earnings, compared to 16.8 times for the S&P 500 Index – shares could easily rally another 50% from current levels.
Throw in a modest 2.7% dividend yield, and what’s not to like?
You might be a redneck if you drive a pickup. But you’d be a pretty darn smart redneck if you also owned a few hundred shares of Ford.
That’s it for this week. Before you go, though, let us know what you think of this weekly column – or any of our recent work at Wall Street Daily – by sending an email to firstname.lastname@example.org, or leaving a comment on our website.
Ahead of the tape,