Jul 22, 2024
On this week's
Stansberry Investor
Hour, Dan and Corey
welcome their colleague Mike
Barrett back to the show. Mike
is editor of Select
Value Opportunities and
senior analyst of
Extreme Value. He joins the podcast to talk
extensively about valuations, why you should
never pay too much for a stock,
and the opportunities he sees in the market today.
Mike kicks off the episode by
giving updates on his pecan plantation and his weekly
Select
Value Opportunities
newsletter. He explains that
this service helps subscribers beat the
market while taking on less
risk. The portfolio has returned about 14.5% since inception
and
has outperformed its benchmark
for nearly 80 straight weeks. Mike's secret to
outperformance is his system...
It focuses on valuations and gives daily rankings of 100
well-
known stocks. That way,
subscribers can enter positions at an ideal moment.
Mike
emphasizes the importance of
valuation and reminds listeners that it's a metric for
future
performance. (1:34)
Next, Mike analyzes the
differences between valuing stocks in public markets and his
past
experience with valuing real
estate in private markets. Plus, he talks more about
momentum
being another important factor
in picking stocks and how valuations have changed in
recent
times. As Mike explains, the
first year he started his service, only 5% of stocks
were
overvalued. Now, in the past
year, 30% are. This is "unprecedented" and a "warning
sign"
that investors should be aware
of. Still, Mike's system can help prevent huge losses.
(19:28)
Finally, Mike gives his opinion
on the overall market action and the broader
economic
picture. He brings up market
cycles, his belief that unemployment is about to be a big
issue,
and factors that will lead gold
and silver prices higher from here. He points out that there
are
fewer higher-paying jobs
available now and that most growth has been in lower-paying
jobs.
This is skewing the jobs data.
And he also discusses the importance of the housing
sector
when it comes to inflation.
(37:27)