If you have not already, I suggest you subscribe to Charles Payne's newsletter at wstreet.com. It is free and you can glean some educational information from it.
Charles states that "The stock market is the greatest wealth creation tool in history."
Charles educates us that there are three pillars of investing: Fundamentals, Technical, and Emotional. All can drive stocks.
Fundamentals - the core financial and economic factors that determine the underlying value in a stock. They include financial metrics such as revenues, earnings, profit margins, dividends, debt, etc. For instance, there are dividend aristocrats that have increased their dividends for 25 straight years (NOBL).
Technical - this is charting and signals from same. If the 50 day moving average moves above the 200 day moving average it is a bullish signal. There are many technical signals such as bouncing off the moving averages, breakouts, rising flag formations. You can use chatGPT to learn much more about technicals.
Emotional - this one is the hardest to control. Many people start to panic on certain news, and the market may have a drastic pullback, so they are fearful, and they sell. Stocks have oversized moves on news. When good stocks decline on news this is when they are on sale, and you should be buying even though there is a pit in your stomach.
Conversely, when the market is soaring and you feel fabulous it is probably time to take a little off the table and redeploy on a later pullback. The stock market has averaged a 10.7% rate of return over the past 100 years and goes up 2 years out of three on average. Buy the dips. NVDA and PLTR are examples of fabulous stocks that you would have made a mint on if you bought the pullbacks.
So, take a look at JOBY for instance. Most of the fundamentals are poor, with the exception of assets and debt. They don't have any earnings and in fact have very little revenue. Near term forecasts are for them to keep losing money. Their stock has gone from below 5 up to over 20 and is now back at 14.
So what do I like about the stock? Potential. Good contracts. Fantastic future both for air taxis and cargo delivery for the military. On the technical side they have no debt whatsoever and they have 900 million in total equity. Several good announcements and developments recently. Venture capitalists are putting their money behind this stock big time.
Can you imagine what will happen when they actually start making a profit? Patience Grasshopper!
