Market Assessment – As of Monday, November 22, 2021, at 6:02 AM.
Last week the DOW was down about 500 points, with lots of selling on Friday.
The S&P 500 is holding close to its historic high, but it’s really being propped up by the big glamours like Apple, Microsoft, Tesla, Microsoft, Google, Amazon, and Home Depot. When they start dropping, “Katie Bar The Door.”
We believe there is a good chance that the DOW slips into a BEAR market sometime between now and the end of January 2022, precipitated by A) the deterioration of corporate earnings and increasing inflation brought about by Biden’s reckless spending policies, and B) the resurgence of the COVID-19 virus in the U.S. and abroad.
A lot of quality stocks that have been upgraded or recently recommended by analysts, have been moving unexpectedly lower.
As we said last week, we would be selling those high-priced stocks with High PE Ratios….and especially those high-priced stocks with no earnings at all, like Snowflake (SNOW) 392.15, and CrowdStrike (CRWD) 257.63. See charts below.
Our “Stock of The Week” is Clarus Therapeutics (CRXT) 4.39. It is a men’s health specialty pharmaceutical company that has the only FDA-approved oral softgel capsule for testosterone replacement therapy. The product, Jatenzo, was approved in 2019, but introduction to the U.S. market was held up by patent litigation with Lipocene, which has been settled by agreement as of this past June, and the settlement does not involve financial payments by Clarus.
This is a VERY SPECULATIVE STOCK, but Oppenheimer’s analyst, Leland Gershell gave it an Outperform rating with a $12 price target back in September. We own a position in the stock and think it is under-valued and also a prime takeover candidate. Finance.Yahoo.com shows it having only 21.7 Million shares outstanding, with a very small float of only 2.23 Million shares. We expect it to double within 6 months.
Joe Cotton has won three National Stock Picking Contests with yearly percentage gains in excess of 96%. His 2020 Wall Street’s Best stock contest winner was Inovio Pharmaceuticals (Symbol INO) with a 742% 1-Year return.
This article is not investment advice, nor is it in any way to be construed as investment advice. For Investment Advice consult a Registered Investment Advisor or a Certified Financial Planner. Joe Cotton’s website is www.cottonstocks.net. NKY’s Joseph W. Cotton is publisher of the market newsletter, Cotton’s Technically Speaking. He is a graduate of Xavier University, a former bank manager and credit analyst, and a former Fidelity Investments registered investment representative. Contact him at firstname.lastname@example.org