Small-Cap Outperformance Continues and I Believe This Name Is a Gamechanger
Although the business media doesn't recognize it, there is some very bullish price action for the majority of the market.
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Small-cap outperformance continued on Thursday morning, but after a 4% jump in the Russell 2000 IWM, some of the stocks with big moves are ripe for profit-taking. Since the indices have been unable to surpass the December highs, we still only have about 300 new 12-month highs, but there have been some pockets of frothy action, mainly driven by good earnings reports.
Although the business media doesn't recognize it, this is a very bullish price action for the majority of the market. The media has a hard time seeing beyond a small group of mega caps and some of the key names, like Google GOOGL and Tesla TSLA, are downright ugly.
We are moving into small-cap earnings season next week, which will increase volatility, and we also have the potential for surprise economic news as well as surprise news from President Trump.
I am hunting for some new positions and have not found much so far. AST SpaceMobile ASTS has really lit up and is moving very strongly. I continue to believe that this stock is a game changer, but at this point, I want to buy more on a pullback rather than chase it here.
I recently highlighted Universal Technical Institution UTI, which is a trade school stock. It posted very strong earnings of $0.40 versus $0.17 last year. I see five analyst upgrades with price targets ranging from $31 to $36. I’ll be adding to this position as it develops.
I’d like to see some dips in a few names that are reporting soon, but I’m more concerned about keeping accounts close to highs and protecting gains right now than I am about adding further exposure.
The media may not recognize this, but this is bull market action for the majority of the market.
At the time of publication, DePorre was long ASTS and UTI.
