Overall, market conditions are little changed. I’d be thrilled if we got trade deals (but I&rs...
From High-Tech to Low-Tech
06/04/2013 10:15 am EST
Whether you want the latest in home entertainment or farm tractors, Chris Versace of PowerTrend Profits has a stock for you.
I was fortunate to meet many of you, as well as other existing and new subscribers, while I was at the Las Vegas MoneyShow. I had a great time at the event and enjoyed many good conversations in between panel sessions I hosted and presentations that I gave.
To sum it up, many interested investors were bullish, but also a little concerned about how much longer the current stock market rally could last, as well as the speed of the economic recovery and the potential impact of Obamacare.
One of our connected home plays, Entropic Communications (ENTR), recently rose nearly 7%. That move vindicates the scaling into our ENTR position we did, as the shares were trading near $3.60 per share. That's more than a 20% gain!
With a number of design wins set to turn into revenue in the second half of the year, I continue to see significant upside in ENTR shares. Even though the shares are way off of their recent lows, there is sufficient upside to be had in the coming quarters.
Deere & Company (DE) reported better-than-expected earnings and reaffirmed its 2013 outlook. Near-term, however, the company announced demand would be softer than expected, given the wet spring weather. And that led to a modest pullback in the shares.
Despite that dip in DE shares, we remain nicely profitable in the position, given our $85.79 entry point. Moreover, there has been no meaningful change in the outlook for corn, wheat, and soybean crops. If anything, the planted corn crop to date falls woefully short compared to historic levels.
To me, that situation indicates we could very well see a weaker harvest compared to what the USDA is forecasting. That would result in even higher corn prices, which translates into favorable farm incomes and sales of Deere equipment.
In other words, the outlook for DE shares for the coming quarters remains bright, and I continue to see upside to at least $105. Subscribers that have yet to add DE shares to their holdings should nibble at the current level to get some exposure, but I would recommend adding more aggressively to the position closer to $85 to $86.
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