You can make a lot of money in high-tech initial public offerings (IPOs).
And so have my members – plenty of times.
But you must follow Your Tech Wealth Blueprint’s second rule for grabbing massive tech profits – Separate the Signals From “The Noise” – and avoid Wall Street’s hype machine.
To see what I mean, let’s put the recent IPO from the photo-centric social network and messaging service Snap Inc. (Nasdaq: SNAP) under our microscope.
When Snap began trading March 2, it was the most hyped tech IPO of the past few years. Investors were told they were crazy if they didn’t get in on the action of a hot young firm with 161 million daily users and $405 million in 2016 sales.
You can bet that Morgan Stanley, the investment bank that underwrote the IPO, stood to bank millions in fees.
Fair enough. That’s how investment banks and IPOs work.
But four months after making all that money, the sharks at Morgan Stanley pulled the rug out from under Snap investors, costing them a combined $3 billion.
Snap shares are now down 45% from their IPO price.
But you can avoid all that – and still make a ton of money on IPOs.
The very first “rule” in my Tech Wealth Blueprint holds that “great companies have great operations.” And those great operations require great leaders.
Now, these leaders don’t have to be “rock star” CEOs with name recognition, like Elon Musk or Mark Zuckerberg. But they do have to be competent and experienced, with the unique vision and wherewithal to make their product or service “indispensable” for billions of consumers no matter what’s happening in the rest of the world.
The kinds of leader who can reshape the world.
That’s the kind of leader – and the kind of company, of course – I’m going to fill you in on today. You might not be familiar with him. He’s certainly not as recognizable as Musk or Zuckerberg.
Immunalysis Corp., a unit of diagnostic player Alere Inc. (NYSE: ALR), said last week that its supersensitive new test for detecting the opioid painkiller fentanyl received U.S. Food and Drug Administration (FDA) clearance for use by labs, hospitals, and doctors’ offices.
And California is less than six months from opening a legal, recreational market that will dwarf all other legal weed states, plus the entire nation of Canada. I’ll tell you why I’m expecting monster profits there in a minute.
Since the bull market began on March 9, 2009, the Nasdaq is up 346%. That’s more than 50% better than the S&P’s return over the period.
And it’s all because of the new Convergence Economy we’ve been talking about here for some time now. These days, every business is a tech business, meaning the sector will beat the overall market for years to come.
Having said that, however, it bears noting that no stock, sector, or market rises in a straight line forever. Sooner or later, the market will lose steam.
Let me be clear. I see plenty of upside ahead through the end of 2017. And it bears repeating this is not the time to horde cash and hope for better prices.
Instead, you want to be in tech stocks. And if you use these three Gut Check Tools, you can invest with confidence – and protect your market-crushing gains.
On the surface, eBay Inc. seems to be flying again with 25% stock gains so far this year and 171 million registered users behind it. But should investors buy on eBay now? Our own Michael A. Robinson talks to CNBC‘s The Rundown about whether it actually has a plan to execute on the expectations that drove the stock price rise or to compete with the likes of Amazon Prime.