The Incremental Investor

Despite being in a similar service sector, Paychex - PAYX and Paylocity Holding Corp - PCTY have significant differences beyond what the following comparison indicates:  In a reversal of role of sorts, PAYX is displaying characteristics of a growth and momentum stock, while PCTY is struggling to match its performance from the last year. It's just up 15.5% on a YTD basis, which beats the NASDAQ hands down, but severely lag the 43% YTD gain of PAYX, which beats both NASDAQ and S&P 500 returns by a mile.  The performance of PAYX has surprised many in the Wall Street and analyst community with its ability to keep going to the upside despite competition from ADP, which is the payroll services behemoth in US. PAYX has benefitted from more outsourcing of payroll from mid-size companies with this looking to be a continuing trend in the near future. PAYX was considered a staid and old school payroll processing name until it was not. The current price in the $130's has already blown...

 Sometimes a change as mundane and innocuous as that of changing a blog title can break a hiatus caused by the "Writer's block". Pandemic induced routines and procrastination can play havoc with even something as simple as blogging about investment updates. Since a lot of micro-blogging has moved to Twitter, Whatsapp, Facebook and other social media site, long form blogging can seem a chore and a ritual of ennui. I have my own complaints about posting on Whatsapp about investing, given the almost inscrutable yet obdurate lack of engagement and discourse with the easiest of investing topics like market trend or direction. To ease my disappointment with the level of apathetic engagement on  my Whatsapp investing group, it does make sense to transfer quite a bit of that micro-blogging here. If my style of investing is incremental, why not post incrementally here, with the advantages of providing detail, context and multiple links and being able to moderate responses.  Increm...

It has not been a great time to be an investor in SQ - Square, the payments and point-of-sale solutions provider for the United States and internationally whose commerce ecosystem includes point-of-sale software and hardware that offers sellers, payment and point-of-sale solutions. After its recovery from the post December 2018 lows, it price has not been able to scale past or even attempt to regain the life-time highs of low $100's, that it reached prior to the Nov-Dec 2018 crash. While it is well off the 52 W lows of $32, it still has way to go before retaking the current 52 W high of $87. It is frustrating to see its peers like SHOP - Shopify and PYPL - Paypal scaling new 52 W highs and getting near it, while SQ pretty much looks to be languishing in the $ 50-60's range. Since small business is the mainstay of  Square, it is going to feel the impact of the current unraveling recession that is disproportionately hitting small and medium businesses, more than SHOP or ...

Many active investors and fence-sitting investors are tempted alike, to look at and consider staking out positions in companies and industries that are hit by the Covid-19 lockdown and its unfolding impact. Some members of  a Whatsapp Investment group that I contribute to and administer, had questions about the strategy of entering into Airline stocks such as UAL - United Airlines and DAL - Delta Airlines. There is always a temptation to pick up once front line stocks that have fallen close to 52 week lows, in the hope of catching its eventual rebound and  ride it through when the recovery gets underway. Some of that fancy also seems to be validated by the kind of stock price recovery that happened with UAL. UAL has rebounded more than DAL, in spite of having its profitability prospects hit worse than that of DAL. Then there is a recent  article on Seeking Alpha that suggests going long on JBLU - Jet Blue because it has a better balance sheet than most of its peers....

My problem with allocation and stock rotation in my IRA portfolio may not be as simple and straight as the title of the post sounds. Recently, I added to my my existing position in General Motors - GM  , which I am having second thoughts about. Despite having potential to grow and find a foothold in the electric and hybrid passengers vehicle market, compared to Ford - F, GM hasn't been doing very well in the 2nd half of the year. Some of the gains of the 1st half of the year have dissipated due to challenging conditions in the passengers vehicle market that has been impacting most players, including the Japanese big three (Toyota, Honda and Nissan). GM is also in the initial stages of a strategic shift to electric and hybrid vehicles, including autonomous and semi-autonomous vehicles and driving. The wrangles it is having with its workforce and inability to strike a deal so far with the UAW is also weighing in on the market perception and sentiment towards this ticker. Unfor...

While this idea has been considered in far greater detail on a recent Seeking Alpha (SA) article , this post seeks to consider or explore the bullish options from a simpler intuitive aspect. Here is the current price and basic fundamentals picture of this ticker: Source: Yahoo Finance The spike on Friday was possibly a reaction to the SA article and realization that the sell-off in this counter was overdone. The market did not like the NTRI - Nutrisystem acquisition made by this company, along with the subdued revenue guidance. Unfortunately the weight loss industry is not in the good books of the market, as seen in the slide back of WTW - Weight Watchers price from the low $100's to the sub-$20's now. From a contrarian perspective, it is too early to write off the weight loss industry. NTRI has been a pioneer in weight loss diets innovation in the past and Weight Watchers is also working on an image and strategy revamp with the help of Oprah Winfrey. Technica...