Once in a while, it's good to step back and take stock of the state of things.
So we asked some of the best stock pickers on Wall Street to help us get a better idea of what's happening out there. Which companies are set to do well in the next year, and which won't?
We asked analysts from the Institutional Investor's All-American Research Team four questions about the sectors they specialize in:
- What is your top stock pick?
- What is the stock you think will underperform?
- What is the biggest trend in your industry?
- What is something that everyone else is missing?
Their answers help paint a picture of several sectors, and their advice might even help your portfolio.
Read on to see who made the list and what they have to say:
Phil Cusick — telecom services/cable and satellite
Firm: JPMorgan
Top buy: Charter (CHTR)
Top sell: Intelsat (I)
Most important theme: "As consumer video moves from being scheduled by the distributor (TV programming) to anytime and anywhere over the internet, the dynamics shift massively.
"Broadband infrastructure companies, wireless or wireline (e.g., fiber, towers, data centers, consumer broadband advantaged companies like cable) are in demand while traditional forms of distribution (e.g., satellite especially but also copper-based telecom players) are at risk."
What everyone else is missing:"On Charter, although this is a popular stock, I think that people are more focused on potential near-term integration risks than on the longer-term story of consumer and enterprise demand, scaling and synergies with the TWC deal.
"We think that the company will stick to its announced minimum leverage of 4x, which means that it could be returning capital by 4Q16 or early 2017."
Jeff deGraaf — technical analysis
Firm: Renaissance Macro Research
Top buy: Gold and precious metals
Top sell: Banks
Most important theme: "We believe an sort of 'institutional inertia' has set in with faith in central bank policy versus common-sense economics. The traditional banking mechanism is impaired. Currency wars are inevitable (and a tailwind for gold).
"While policies have favored passive investment versus active, we believe people should be moving away from passive and toward active as index returns stagnate."
What everyone else is missing:"While most of the world has been conditioned to believe that gold is a useless 'barbaric relic,' we ask two questions. If that's the case, then you should be willing to give it away for nothing (yet no one does), and gold has never defaulted (EVER) in the history of the world and its usage of money."
Joe Greff — gaming and lodging
Firm: JPMorgan
Top buy: MGP Growth Properties (MGP)
Top sell: N/A
Most important theme: "MGP (still) possesses an attractive risk-reward in the current low growth (US GDP) and (still) low interest rate environment given its secured current rent, rent growth potential related to its escalator in 2017 and beyond, and incremental growth potential coming from the recently completed Borgata acquisition, generating a (still) attractive dividend and dividend yield."
What everyone else is missing:"At [MGP's] $30, the current dividend yield (most recent quarterly dividend multiplied by 4, i.e., before positive Borgata impact) is ~5%, a 10 bps premium to larger-cap TNL REITs, so we think there should be support at these levels. Most sell-side price targets hover near current levels and we'd expect upside to most of them."
See the rest of the story at Business Insider