Value investing has created more billionaires than any other strategy, like Warren Buffett, who built his fortune by purchasing wonderful businesses at reasonable prices.
But these hidden gems are few and far between - many stocks that appear cheap often stay that way because they face structural issues.
Many small-cap stocks have limited Wall Street coverage, giving savvy investors the chance to act before everyone else catches on.
But the flip side is that these businesses have increased downside risk because they lack the scale and staying power of their larger competitors.
Not all profitable companies are built to last - some rely on outdated models or unsustainable advantages.
Just because a business is in the green today doesn’t mean it will thrive tomorrow.
The S&P 500 (^GSPC) is home to the biggest and most well-known companies in the market, making it a go-to index for investors seeking stability.
But not all large-cap stocks are created equal - some are struggling with slowing growth, declining margins, or increased competition.
Consumer staples are considered safe havens in turbulent markets due to their inelastic demand profiles. On the other hand, they usually underperform during bull runs,
and this paradigm has rung true over the past six months as the sector’s -5.7% decline paled in comparison to the S&P 500’s 5.7% gain.
Amazon.com Inc. (NASDAQ: AMZN) has subtly increased prices on everyday items, including deodorant, protein shakes, and pet care products. This move is in stark contrast to the company's earlier promise to maintain prices despite the tariffs.
Jim Cramer recommends buying SoFi Technologies and American Express, while waiting for a pullback in Lincoln Electric shares. FICO also looks promising.
