3 Stocks Flashing Buy Signals (Episode 20)

So the stock that I'm referencing is Walmart. And I just wrote about this stock is one of my three stocks that I think will do well, no matter whatever you believe about inflation. And we can talk about that in a little bit, but the specific news as it relates to Walmart is there's two things that I really caught my attention about this stock right now. The first was the news that broke yesterday. They've hired John Rainey, the now former CFO of PayPal away from them. And he's coming over to Walmart, which I think it's important because Walmart has been very deliberately moving into the digital transaction space. And it seems that bring over somebody like John Rainey, who unquestionably PayPal has grown under his watch. And now you're bringing him in and there could be some synergy there, especially when you consider that one of PayPal's missions, I guess, if you would call it, that was to service those that were the unbanked. And I suspect that that might dovetail fairly nicely into some of the consumer base at Walmart. And so I think there's some synergies there as far as what rainy is going to bring to Walmart, kind of an intriguing play there as far as why he would choose Walmart. And obviously, you know, I think that's one of those that when you get that call, you probably you take that call and you go from there because apparently PayPal was not aware of his departure. This was a surprise to PayPal.

I can't say, I know specifically what key might be going there to do. Is it on the back end? Is it that the marketing aspect of it I'm intrigued just by the fact that maybe there's going to be a synergy with PayPal itself with Walmart and just the ability to, for consumers to make their transactions a totally different way by that. I'm not suggesting that Walmart is gonna start delving into the crypto space or anything like that. Right. but I'm saying, you know, I think there is that peer to peer transaction component of it that certainly, you know, Rainey's bringing that over.

Well, there is another angle there that I like, and that is the healthcare angle because Walmart's been making a push into healthcare. And one of the interesting things that tends to happen historically is that once investors feel confident that inflation has actually peaked healthcare tends to be the sector that they move to right now, investors are still solidly in the energy sector, which makes complete sense. But once they decide that inflation may indeed have peaked, healthcare tends to be the area that they focus into. And Walmart's been making a push into becoming more established as a player in that arena. In

I've been seeing things about as far as just the pharmacy end of it and the pricing power that they bring to bear.

Yes. They're trying to do that model of they're calling it Walmart health.

And so actually they're trying to do things like primary and urgent care, all of those things in one facility. Okay. So this would be obviously apart from the Walmart super centers that we know of. Right. But these would be actual different facilities that would take care of some of that other, some of the primary and urgent care considerations.

Well, the first one then actually both of these that I wanna talk about, but the first one is gonna be NewCor. And these next two that we're gonna talk about are by some common fundamental metrics, these stocks are considered undervalued and inflation is the, I wouldn't even say it's the elephant in the room. It's just, it's there right now. The CPI number came out this week. The PPI number came out this week. Both numbers came in hot. I don't have any insight as far as has inflation peaked. Has it? Not my guess, is it hasn't yet? And that's more based on what the PPI said than what the CPI showed, but if I'm an investor right now, I'm looking for undervalued stocks.

You know, I think it lost some favor with investors because of the, I think there were assumptions. There was going to be some disruption in the housing market and some disruption with the building because of inflation.

But it hasn't happened. I think there was some concern about how the Russian invasion of Ukraine would affect it, but that never really made sense to me as an argument, because I think all that's really doing is it's taking two of the major steel exporters offline mm-hmm so that's a benefit for NewCor. And I don't see that going away anytime soon, who knows when the conflict, the war there is gonna end, hopefully obviously ends quickly. But even when it does, it's gonna take a while for the economic fallout to reverse itself. So I see NewCor as being in a really good position, like you said, the PE is low.

It would, especially when you look at long term growth, like revenue and earnings for new car are projected to be down mm-hmm from where they are now. I see that. So, so I could make the argument and say, well, who cares that it's got the low PE ratio? It's not gonna have the same growth that it's had over the last couple years. But like you just said, that's assuming that there won't be growth in the new construction area, which I don't believe is gonna be the case. And it also assumes that the steel production that the markets come to expect from Russian, Ukraine's gonna come back online anytime soon, which we don't know, anytime you're dealing with stuff like this, it's there's speculation in looking

Well, I think it's, you know, there's a lot of people that probably do day trading or who are very active traders, who all admit, they probably don't agree with me on a lot of things. I tend to come at it from more of a conservative approach. I'm looking at it right now and saying, where can you make money right now? So I don't know if you're an investor right now, to me, Nucor is a steady Eddie. You put it in there, you have it. You are gonna get some growth this year. And I think analysts are projecting it to actually analysts are projecting it to go down from its current price. But recent, you know, so, but analyst projections are, I think the most recent ones came in in March. So they haven't had any recent ones come in.

Well, yeah, and I especially think that's a good idea because they've got earnings coming up here in about a week. So, you know, right now, if you're not currently in the stock, this would probably be a good time to at least certainly wait to hear what they say. The all important guidance word comes out and what are they gonna be guiding for for the rest of the year. But to me, it's stock, that's clearly undervalued now by most metrics that investors would use, it pays a great, not, I mean, it's not a great dividend, but it's certainly a reliable dividend, but I think it's 49 years going on. So it's a stock that if you're looking for something to get into help offset inflation, new course seems like a very logical pick there.

Yeah, the next stock I've gotta talk about is camping world. And again, this is another stock that if you're just looking purely from a fundamental standpoint, this stock looks undervalued right now, PE ratio around four and a half.

Earnings they've been, they're doing well. And what I've noticed about this stock that was impressive to me is they've been beating 2020 numbers.

Right? And 2020 numbers were outstanding because again, you're dealing with the pandemic and you know, people obviously camping and assorted activities surrounding camping became very popular. But the RV industry, there's still a backlog of orders. So that was an industry in general that needed a shot in the arm. And it certainly got it. And it production is still, like I said, there's still backlogs. So that's a catalyst for this company and they're around their 52 week low at this point. And this is one that's the opposite of NewCor because here the analysts are guiding much higher, much closer to the 52 week high. And so here's one where I have to tip my hat here to Thomas Hughes because he wrote an article for MarketBeat about, I don't know, maybe six or seven weeks ago. And he was commenting on the fact that you had the low PE ratio.

You have a dividend deal at that time, it was 8%. Now it's even higher than that. And he was saying about how that was a deal that wasn't gonna last very long. Well, here you go. You got six weeks. The deal is still in place there. So, you know, investors that are looking for that, this seems like one that if you wanted to get into it now would be a great time to do. However, again, the same caveat we had with Newport earnings are coming up not next week, but I think the beginning of may on this one. So again, you may wanna hold off there until that earnings date and you hear the guidance, but it's one that looks very solid. Lots of institutional ownership on this one as well. In fact, about almost over two to one in terms of buying and selling in the last 12 months.

No, I just pulled up the stock myself. Yeah. Yeah.

And again, I'll go back to the same comment I made with NewCor. I think there's a lot of people who are more active traders and day traders who probably look more at technical signals for when to enter and exit a trade. I always tend to be more of a big picture. Where is this thing? Is there a narrative that gets this thing moving higher? Because you're right. If I look at the chart, I can say, well, if I look at the RSI, it's suggesting that we're getting pretty close to oversold, but that doesn't necessarily show up when you look at the simple moving averages either.

Sure they can find me on Twitter. That's at CTM copywriter and they can find me on LinkedIn as well.

Thank you, Kate. I look forward to it.