Let the Right Data Guide Your Investing Confusion… delay in making decisions… lack of critical evaluation of information … anxiety … stress…. These are all documented symptoms of information overload. You couldn’t be blamed for feeling any of these recently given all that is going on in the world, and specifically in the markets. How are you supposed to make good decisions about your money when the war in Ukraine, $100+ barrel oil, inflation at historic levels, supply shortages and earnings season all converge, and you have dozens of different interpretations of what this all means? Information overload is defined as an excess of information available to a person aiming to complete a task or make a decision. Understandably, it impedes decision-making and often results in poor decisions, or even worse no decision being made. Given everything going on, it’s no wonder investor sentiment is decidedly negative. According to the latest American Association of Individual Investors survey released Wednesday, only 16.4 percent of investors are feeling bullish. Most are feeling bearish (59.4%) and the rest are neutral. Meanwhile, consumer spending hasn’t slowed. A story in Friday morning’s The Wall Street Journal notes that economists saw an uptick in consumer spending in March, fueled by dining out and travel. As you probably know, consumer spending is the backbone of the economy, so even though many people are feeling negative there is no sign of a recession in the immediate future. Don’t be fooled by Thursday’s report that U.S. GDP fell at a 1.4% pace in the first quarter. As my colleague Jeff Remsburg explained yesterday in the Digest, a burgeoning trade deficit helped shave 3.2 percentage points off growth as imports outweighed exports. The number also reflects an 8.5% pullback in defense spending by the government, which knocked one-third of an entire percentage point off the final GDP reading. As I was saying … information overload…. | ADVERTISEMENT Buy, Sell, Hold? Markets have crashed… gone up… and back down again. What’s the number one thing to do now? Louis Navellier and Luke Lango say it’s time to take advantage of the “Divergence Window” – the single most important story of 2022. Click here to learn more. | | | Making sense of the markets with data… At times like these, it’s great to hear from an industry veteran such as Louis Navellier. Louis has been called “the King of Quants” by Forbes, and he uses data, data and more data to make investing decisions. That’s why even in volatile market conditions, Louis is still buying certain stocks. In fact, in yesterday’s monthly issue of Growth Investor, he bought three. To help put the market moment in perspective, here is what he wrote to Growth Investor subscribers: Remember, the stock market is narrowing and growing more fundamentally focused. So, companies that announce strong earnings and sales, top analysts’ estimates and provide strong forward-looking guidance are being rewarded. Well, energy and commodity stocks have some of the best fundamentals out there, as they’re profiting from rising energy prices and robust demand. And that environment is anticipated to persist for the foreseeable future, so most of these companies have accelerating earnings momentum and will provide positive guidance. Personally, I expect the one-two-three punch of better-than-expected earnings, positive guidance and increased analysts’ estimates to dropkick and drive our stocks higher in the upcoming days and weeks. So, I encourage you to remain patient and to not be shaken out of the market. When the dust settles, I fully anticipate our stocks will emerge as the big winners in the first-quarter earnings season and will lead the market higher… Our Growth Investor stocks continue to profit from inflation, especially food and energy inflation, and as a result, they remain characterized by accelerating sales and earnings growth. Specifically, our average Growth Investor stock is now characterized by 53.7% forecasted annual sales growth and 396.8% forecasted annual earnings growth. The analyst community has also increased earnings estimates by an average 19.8% in the past three months, so I think we can beat our fourth-quarter average earnings surprise of 11.9%. In comparison, the S&P 500 has experienced decelerating sales and earnings due largely to more difficult year-over-year comparisons. FactSet currently estimates that the S&P 500 achieved an average earnings growth rate of 6.6% and an average revenue growth rate of 11.1% in the first quarter. You can learn more about Louis’ latest three Growth Investor picks by clicking here. | ADVERTISEMENT Whether You Have $500 or $5 million…READ THIS 99% of Americans don’t know about this… And it could mean a “make or break” scenario for them in 2022. Click here to find out more. | | | The Divergence is Coming… Luke Lango, editor of Early Stage Investor, is also laser focused on earnings. This week, he noted that consumer spending remains healthy, and explains the positive earnings report from companies such as Visa (V), Chipotle (CMG), Skechers (SKX) and Garmin (GRMN). Meanwhile, on the tech and innovation side, this month has been rough. As I write Friday morning, the tech-heavy NASDAQ is headed for its worst month since March 2020 (the COVID crash). Luke notes that in some cases, stocks with superior sales and earnings, the same fundamentals Louis focuses on, are getting crushed in the broader tech sector. If revenues and earnings are directly correlated to a stock’s price, shouldn’t the opposite be happening? Where others see trouble, Luke’s research is showing this to be an opportunity: This phenomenon is called a divergence. Every once in a while, stock price diverges from the revenue trend line. Revenues and earnings continue to move higher, yet the stock price sinks lower. This opens a window of divergence that continues to widen. But eventually, those stocks must snap back to their equilibrium and move in tandem with earnings — convergence. And when that happens, we’ll see some enormous returns. Now, this divergence window doesn’t open for every stock. Only certain stocks take advantage of this price “snap-back.” | ADVERTISEMENT 1,000% Gains in THIS Market? It’s called a “Divergence Window.” The last time we saw one was in 2008, right after the Great Recession… where you could have seen back-tested gains as high as 1,730%, 935%, 861%, and even 2,150%. But investing prodigy Luke Lango says the next one around the corner will be bigger. Click here to get on his 2022 Divergence Window watchlist. | | | Luke has dug into the numbers about previous divergence windows and has identified the characteristics of stocks that can take advantage of this window. Luke has developed a presentation about these Divergence Windows, and you can sign up for the briefing where he explains the opportunities by clicking here. Enjoy your weekend | 
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