3 NASDAQ Stocks You Should Look At Today As The Index Reaches An All-Time High – Part 1
On June 8th, 2020, the NASDAQ Composite stock market index traded above the 10,000-point mark for the first time ever[JR1] . [i]
This surge is due to great earnings reported from members of NASDAQ… The likes of Amazon, Apple, Microsoft, Facebook, and other tech giants in recent weeks[JR2] . [ii]
This is a huge recovery in recent week…
The index hit its previous high of 9,817.18 on February 19th, 2020.
Then fell in Mid-March when the market crashed to its recent low of 6,861 due to the coronavirus. This is a fall of 30.1% in a month.
Since that point, the index is now up 46% from its recent low to its new all-time high of 10,020 as of this writing on June 10th, 2020.
This is quite the rollercoaster ride, as you can see in the image below.
Why is this?
Because the NASDAQ is a tech heavy index… Meaning many of the companies that list on the NASDAQ are tech companies.
The index fell in March due to the concerns of the coronavirus as it began to sweep the world. But recovered fast after companies in this index – namely the tech giants mentioned above – showed stellar earnings in recent weeks.
Why do these companies have great earnings? Most of the rest of the companies in the world fall into 3 categories right now with this coronavirus crisis ongoing…
- They’re seeing results below normal.
- Are showing horrible results.
- Some are even facing bankruptcy. [i]
Because people are relying more than ever on technology to survive and work during these crazy coronavirus times.
This is why the NASDAQ just hit its all time high a couple days ago… These companies are doing great despite what we’re dealing with.
But you can still find stocks in this index that are selling at good to cheap values that will perform well in the coming years and decades.
In the coming days, I’ll show you 3 stocks from NASDAQ you should consider buying today… Even with the market at its all-time high.
Let’s get to stock #1…
Disclaimer – The stocks below we believe in enough to tell you about but the 3 stocks below ARE NOT official recommendations. Due to potential legal issues we can’t officially recommend them to you. But these should be a good place to begin your search.
You’ve heard about and used this companies’ products for years… Maybe even decades.
Intel was the creator of the semiconductor in October 1971. And soon after the company’s products were in almost every PC on Earth.
Today, it’s still the #1 semiconductor producer in the world as it owns an estimated 77%+ market share in various semiconductor markets. [i]
Intel’s owned this massive market share for years now. And will continue doing so well into the future due to its competitive advantages.
Namely its brand name and power, distribution network, and economies of scale. These advantages allow Intel to keep competitors at bay. And allow the company to earn huge profits and cash flow which I’ll talk about more later.
It dominated the semiconductor market for decades… But it also now operates in the sensor [ii] and driverless car arenas [iii] after recent acquisitions. And these all will be huge areas of growth in the years to come.
With the rise of the Internet of Things (IoT) [iv] soon almost everything we use daily will have semiconductors and sensors in them.
From the shoes you wear showing you how to run better… To chips in your body showing you when you need to go to the doctor… To smart traffic lights around cities minimizing rush hour traffic.
In the coming years and decades almost everything we use will have semiconductors and sensors in them showing you data on how to avoid things. Or how to do them better and faster.
With Intel’s dominance in these two arenas – plus driverless car technology – Intel is well positioned to continue dominating now and well into the future.
Plus, its enormously profitable now too…
Over the last decade Intel’s produced an average 29.1% operating margin every year over the last 10 years. I look for any company to produce above 10% margins on a consistent basis to consider a stock for investment.
Operating profit is the amount of profit a company produces from its operations… And is after subtracting costs to do business and research and development… Which Intel invests in enormously.
It also produces a ton of cash too…
Its FCF/Sales margin averaged 19.7% per year every year for the last decade… I look for anything above 5% on a consistent basis to consider an investment.
Free cash flow or FCF is the amount of money that’s left over after all costs to run the company now and to grow it. This number is also after paying taxes too.
Think of FCF as the ultimate profitability of a company. Because its money the company makes after paying all its bills.
Intel meets and surpasses my threshold on both important metrics… These are important because they show Intel produces profits and cash to continue funding operations and growth.
These enormous profits also make Intel a super safe investment as well.
And on top of all this, Intel also pays a 2.1% dividend currently.
With all this you figured Intel stock would be expensive right now… But it’s not.
As of this writing Intel’s selling at a P/E of 12.2 and a P/FCF of 8.1.
I look for potential investments to sell below 20 on both metrics. And Intel is well under these.
Intel will be around for decades to come – no matter what the economic situation becomes.
And it will make you money both today and well into the future because of the things outlined above.
If you’re investing now, look at adding Intel.
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Tune in tomorrow to this page to see the next NASDAQ stock you should look at.