Markets pulled back last week after a couple Federal Reserve officials signaled that the Fed may still have to hike rates further to combat persistent inflation – damaging the narrative that the March hike was the final one in the fastest rate hiking cycle in history.
Throw in renewed concerns about the regional banking crisis (with PacWest high on the “worry list”), some big earnings misses, and US consumer sentiment hitting a 6-month low – and you have a recipe for another losing week.
Still, with inflation coming in lower than expected, indexes were overall only down slightly. The S&P 500 has remained range-bound for weeks – and last week’s performance did not deviate from that range. Markets are “stuck”.
But while the broader markets may not be going anywhere, this doesn’t mean there isn’t still plenty of opportunity in individual stocks. That’s why in today’s post, we’ll be highlighting three stocks that should be on your radar for this week.
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Chesapeake Energy Corporation (CHK)
CHK is an oil and gas company with assets in the United States. While its stock has come down over the past year – on par with many energy stocks – there are very good reasons to pay attention to this stock.
The first is its dividend yield – currently standing at a very healthy 10%. Then, it’s the earnings supporting this yield. In the first quarter of 2023, CHK posted revenues that were almost 5x the year prior, with a net income of $1.4 billion. Its balance sheet is healthy and it has responded to declining natural gas prices by adjusting production and hedging conservatively.
Should gas prices recover, this stock could surge. And even without that – it’s already a very healthy dividend player.
Las Vegas Sands Corp. (LVS)
When most people think of stocks and sectors that have defied the market decline of 2022, they rightfully think energy. But gaming giant LVS is also up there, with its stock having risen an astounding 80% over the past year. And that’s on a $45 billion stock!
One of the biggest catalysts for this stock is a rebound in gaming on the other side of the world – Macau. This has been reflected in the stock’s recent earnings, which crushed analysts’ expectations. Earnings per share came in at $0.28 compared to expectations of $0.20 (and compared to a $0.40 net loss a year ago). Revenue also more than doubled with a 124% increase.
As the hotel industry continues its comeback, LVS is one to watch.
AMC Entertainment Holdings, Inc. (AMC)
Remember AMC – the other stock that also saw incredible (and totally unsustainable) surges during the whole GameStop short squeeze saga?
Sure, AMC has fallen over the radar for quite a while now. But unbeknownst to most investors, it’s been building up some serious momentum. Thus far, in 2023, AMC is up over 30% – and while it’s been far from even, with some major volatility along the way, it would be smart to pay attention to this trending stock.
After all, it’s still trading rather cheaply, with a price-to-sales ratio of only about 1.6x – meaning it could still have a lot of room to run. Just remember what kind of stock this is – a fast-moving momentum stock, not a long-term buy-and-hold value play.
To your wealth,
Felix @ Ace of Investing