7 A-Rated Stocks to Buy in the Second Quarter

The Federal Reserve came out of its most recent meeting about as dovish as it could get. This is marked change from where it was in the fourth quarter of last year. As it unwound its portfolio of mortgage-backed securities and kept a keen eye on inflation, many market sectors were wondering how they were going to keep growth going after the steroid shot of a tax cut.

But December changed all that.

The Fed backed off its intent to raise rates as planned in 2019. And it would hold on to its portfolio. And the markets have been feeling good ever since. However, it recent announcement that it has no plans to raise rates or sell anything in its portfolio has actually frightened the markets.

Now, investors are worried that the economy may be weaker than we expected and that 2% growth may not be as easy to get as anticipated. And today’s manufacturing PMI sliding to 21-month lows reinforces that.

But the 7 A-rated stocks for Q2 that follow will be top performers because they’re best in class stocks in well-performing sectors.

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CyberArk Software (CYBR)

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CyberArk Software (NASDAQ:CYBR) is a cybersecurity company that’s based out of Israel but has clients all over the globe. Its claim to fame is its privileged-access security software.

Privileged accounts are the most secure properties that exist in most organizations. And when those organizations are storing very critical data like financial institutions, healthcare companies, utilities and other enterprise organizations that have significant amounts of these types of accounts, it’s crucial that they’re secure internally and externally.

And this is CYBR does. It also offers other products, but this is the hub of its cybersecurity wheel.

As we see bigger and more sophisticated hacks of major databases and the information inside those databases, more and more companies are doing their best to avoid being the next embarrassing headline.

The A-rated stock is up 138% in the past 12 months, which is testament to the growing global demand for CYBR’s platform.

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Lululemon (LULU)

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Lululemon athletica (NASDAQ: LULU) is an upscale sportswear company that pretty much coined the term ‘athleisure’.

What LULU has done very well is know its customers and maintain control of its brand. Its products are not cheap. But that’s the point. They’re well made, and by not distributing them outside of its own retail shops and e-commerce site, it has been able to keep prices where it needs them to be.

Bigger brands in the market have massive distribution networks, which means pricing premiums are harder to maintain and that makes it tough to control margins.

LULU has built a great and growing customer base and has patiently expanded its market in to menswear.

LULU stock is up more than 80% in the past 12 months, yet it still trades a trailing P/E of 51. That’s amazing given the growth potential out there and how well run this company is.

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First BanCorp (FBP)

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 First BanCorp (NYSE: FBP) is a Puerto Rican bank that has been in business since 1948. It also has operations in the U.S. and British Virgin Islands.

While the recent devastating hurricane is still fresh in our minds and the Caribbean — in particular Puerto Rico — is still recovering, the fact is that redeveloping the island is underway. And that redevelopment means money has to start flowing in.

That’s why being one of the top local banks is a great position to be in right now. Also remember that other islands were affected by the hurricane and Puerto Rico is a big financial hub for other Caribbean islands.

This increase in rebuilding and redevelopment has certainly been reflected in FBP’s stock price. The stock is up more than 80% in the past 12 months. That’s pretty spectacular for a financial stock.

And there’s plenty more to come, given the fact that this A-rated stock is still trading at a trailing P/E of 12.

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Intuit (INTU)

Source: Mike Mozart via Wikimedia (Modified)

 Intuit Inc (NASDAQ: INTU) is a software development company that is best known to consumers — especially this time of year — for TurboTax.

It also owns QuickBooks which is a suite of financial and business tools geared toward small businesses. It allows small business owners a place to do payroll, sort out taxes, integrate all the accounting inputs and even market and hire.

INTU’s other division sells similar products that are focused on professional accountants and larger businesses.

But the real growth potential is in the products focused on small businesses and consumers. In this gig economy both tools are increasingly popular and their brands have a commanding presence in the market.

As the economy grows, so will INTU’s fortunes. It’s up 51% in the past 12 months but only trades at a trailing P/E of 46.

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Costco (COST)

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Costco Wholesale (NASDAQ: COST) is the Land of Giant Portions and a great favorite for small businesses and consumers alike.

Last year, Costco was doing well. It tends to reflect the broader economy, so when the economy is chugging along, so is COST. But in December, it hit the same wall most consumer stocks did.

Worries about growth moving forward and all the feel-good valuations up to that point disintegrated.

However, COST came roaring back like it was a beaten down semiconductor stock.

At this point, its 12-month return is 32% and its trailing P/E is 31. COST should have a strong year, with decent growth ahead and wages improving. That means more people shopping and spending.

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Mastercard (MA)

Source: Håkan Dahlström via Flickr (Modified)

Mastercard (NYSE: MA) is one of the leading and oldest payment processing companies out there. Now, a decade ago, I would have likely called it a credit card company. My how the world has changed.

Granted, MA got started as Interbank in 1966 and landed on its current incarnation in 1979. Remember, back then, if you were traveling, you couldn’t just whip out a card and buy things. Banks and their merchants needed to be interconnected so that your card could charge a dinner at a California restaurant even though your bank was in Kansas.

The credit card was a revolution at the time. Just as electronic payments are today. And now that national transaction has given way to international transactions that are all done without cards at all.

This history and brand recognition is what has propelled MA in this new financial services transformation. It’s up 35% in the past 12 months, but this new financial digital world has only just begun.

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Texas Pacific Land Trust (TPL)

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 Texas Pacific Land Trust (NYSE: TPL) has been around since 1888, when the Texas and Pacific Railway went belly up.

Obviously, at the time, railroads owned huge amounts of land so they could develop their lines. And the Texas and Pacific was no different. Also, given its name, most of this land was in west Texas on the way to the Pacific.

At the time of its demise, the railway owned 3.5 million acres that was transferred to TPL. Today, TPL still holds about 900,000 acres of this land, which still makes it one of the largest landholders in Texas today.

Fundamentally, TPL leases the land to companies that are either energy firms (not just oil and natural gas but wind and solar farms as well) or water companies and it takes those rents as its revenues.

This is a solid business in slow times. But in good times — like now — it promises some big gains. TPL is up 47% in the past year and 71% in just the past 3 months, so momentum is growing significantly in 2019.

Louis Navellier is a renowned growth investor. He is the editor of four investing newsletters: Growth Investor, Breakthrough Stocks, Accelerated Profits and Platinum Growth. His most popular service, Growth Investor, has a track record of beating the market 3:1 over the last 14 years. He uses a combination of quantitative and fundamental analysis to identify market-beating stocks. Mr. Navellier has made his proven formula accessible to investors via his free, online stock rating tool, PortfolioGrader.com. Louis Navellier may hold some of the aforementioned securities in one or more o

5 Ways This Tech Leader Is Crushing a $700 Billion Market

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Michael A. Robinson

This time, Wall Street didn't freak out.

In fact, the S&P 500 had its best day in eight sessions last Thursday as stocks across the board entered a rally.

You can chalk that up to the fact that just the day before the Federal

Reserve struck a very dovish tone, suggesting interest rates won't rise far or fast this year.

What didn't get much notice is just how volatile the bond market had become over the past six weeks.

Here's the thing. Choppy bond trades by definition means there's quite a frenzy of both buying and selling.

And that's great news for savvy tech investors.

Let me explain. Even on a "calm day," the nation's bond market is highly active. We're talking a daily volume of $700 billion, more than three times that for stocks.

And it's our mission to look for a tech angle into this massive segment that will give us market-crushing profits.

Today, I'm going to reveal a firm that is doing just that.

And I'll show you the five reasons why this is the single best way to play this massive market…

Check it out…

Where the Money's At

Please don't misunderstand me. I'm in no way suggesting you bypass big tech winners and other equities in favor of bonds, even if we see higher interest rates ahead.

It's just that many investors buy bonds or bond funds for the income, and give up a lot of growth. But as I always say – avoid false dichotomies. You want at least a portion of your "fixed income" portfolio to give you so-so growth.

Otherwise, inflation can eat up a lot of your paper profits. If we could just capture a fraction of the bond market's amazing volume, we stand to make a lot of money.

Now, the U.S. stock market boasts roughly 6,500 shares traded on major exchanges. Though that's quite a lot to choose from, it's only a fraction of the more than 200,000 types of unique taxable bonds offered.

Here's the thing. Despite the rise of the Web and electronic trading, most broker dealers still buy and sell directly with each other. Analyst say that electronic bond trading only accounts for a little more than 20% of all transactions.

As you can see, that's quite a fertile field for MarketAxess Holdings Inc. (Nasdaq:MKTX). This is the premier high-tech firm serving the bond market, and it's a company with a lot of room to grow.

For instance, the tech leader in this space right now handles 95% of all electronic bond deals. But that is still less than 20% of all bond trades made today.

To show you why this exciting stock still has plenty of upside ahead, let's run it through my five filters for building wealth with market-crushing tech winners.

Tech Wealth Builder Rule No. 1: Great Companies Have Great Operations

I'm talking about well-run firms with top-notch leaders.

And MarketAxess Holdings has a CEO/founder who is second to no one in the fixed income market. Richard M. McVey began his career at storied Wall Street firm JPMorgan Chase & Co. (NYSE:JPM).

Beginning in 1992, he spent four years serving as managing director and head of JP Morgan's North American futures and options business, and then served as head of North American fixed income sales and institutional client relations.

Concannon has a Master's degree in business, as well as a law degree. He's also had stints at Nasdaq, Instinet, and Cboe Global Markets, one of the world's largest exchange holding companies.

And just a few weeks ago, at MarketAxess, McVey moved to strengthen the senior team. He named Chris Concannon as president and chief operating officer.

Tech Wealth Builder Rule No. 2: Separate the Signal from the Noise

To create real wealth, you have to ignore the hype and find companies that have rock-solid fundamentals.

The firm has that in spades. It boasts a 49% operating market, and a 27% return on equity. This is a company with nearly $267 million in cash, and stockholder's equity is seven times greater than the firm's total liabilities.

Right now, Wall Street looks at the bond and stock markets as plain binary choices. The heard doesn't seem to grasp the major fundamental here. As the world goes digital, there's plenty of upside for a firm that is leading the way.

While Wall Street busies itself handicapping the Fed's actions, our team at MarketAxcess is getting ready for more trading volume. They recently added a module that lets clients use data analytics to improve their bond trades, and now count more than 1,500 active clients.

Join the conversation. Click here to jump to comments…

Michael A. Robinson

About the Author

Browse Michael's articles | View Michael's research services

Michael A. Robinson is one of the top financial analysts working today. His book "Overdrawn: The Bailout of American Savings" was a prescient look at the anatomy of the nation's S&L crisis, long before the word "bailout" became part of our daily lexicon. He's a Pulitzer Prize-nominated writer and reporter, lauded by the Columbia Journalism Review for his aggressive style. His 30-year track record as a leading tech analyst has garnered him rave reviews, too. Today he is the editor of the monthly tech investing newsletter Nova-X Report as well as Radical Technology Profits, where he covers truly radical technologies – ones that have the power to sweep across the globe and change the very fabric of our lives – and profit opportunities they give rise to. He also explores "what's next" in the tech investing world at Strategic Tech Investor.

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