🍱 Things getting cheaper

and higher targets for the stock market

Sponsored by

Good morning investors! The positive inflation report yesterday sent stocks and crypto soaring with BTC again crossing the $66,000 mark; however, meme stocks are tumbling.

Today we cover:

  • Inflation report shows positive signs.

  • Stocks to hit a new high?

  • Dividend investing. "With a good perspective on history, we can have a better understanding of the past and present, and thus a clear vision of the future."

Also, don’t forget to check our latest video and give us a sub:

📊 Economy and News 

Grocery prices fell for the first time in a year

After a hot start to 2024, inflation cooled back down in April, providing a bit of hope for Americans worn down by elevated prices.

Consumer prices were up 3.4% for the 12 months ended in April, easing from 3.5% the month before, according to Wednesday’s Consumer Price Index report.

On a monthly basis, prices rose 0.3%, a slower pace of growth than the 0.4% seen in the two months prior.

Economists were expecting a 0.4% monthly increase and an annual gain of 3.4%, according to FactSet consensus estimates.

The breakdown: Rising gasoline and shelter costs accounted for more than 70% of the monthly increase in overall inflation.

Grocery prices fell for the first time in a year, dropping 0.2% from March.

Core numbers: Core CPI, which strips out the more volatile categories of energy and food, slowed from 3.8% to 3.6%, its lowest rate since April 2021.

From the month before, core CPI ticked up by 0.3%, its slowest pace since the end of last year.

The result: All three major indexes surged to record highs after new data with the broad market index gaining 1.17%, breaking above 5,300 for the first time, to end at 5,308.15.

Global hits:

Good to know: Tesla’s Chinese rival Nio launches a new brand and car that undercuts the Model Y by $4,000.

📈 Stocks

S&P 500 5,308.15 (+1.17%)
DJIA 39,908.01 (+0.88%)
NASDAQ 18,596.65 (+1.49%)
BRENT CRUDE 83.10 (+0.454%)
* Prices as of May 16th, 12:20 AM UTC

BMO raises S&P 500 price target to 5,600

BMO Capital Markets is raising its 2024 price target for the S&P 500, as they believe the robust stock market momentum is likely to persist.

It had set a target of 5,100 earlier this year.

“We are comfortable with this because we believe the market is behaving in a similar fashion to 2021 and 2023 – years where we did not give enough credit to the strength of market momentum, something we are trying to avoid this time around,” they said.

“Our new target of 5,600 would imply a year two return of 28.7% bringing the two-year cumulative performance of this bull market to 50.3% – which is roughly in line with the historical average,” they added.

Revealed: Warren Buffett’s Berkshire Hathaway disclosed a major stake in the insurance company Chubb, finally revealing the investment he has kept under wraps since last year.

Also, Netflix ad-supported tier has 40 million monthly users, nearly double previous count.

Interesting: U.S. consumers are holding on to their iPhones longer, which is likely to impact unit sales in the region over the next 12 months.

Sponsored by Ryse

Missed out on Ring and Nest? Don’t let RYSE slip away!

Ring 一 Acquired by Amazon for $1.2B

Nest 一 Acquired by Google for $3.2B

If you missed out on these spectacular early investments in the Smart Home space, here’s your chance to grab hold of the next one.

RYSE is a tech firm poised to dominate the Smart Shades market (growing at an astonishing 55% annually), and their public offering of shares priced at just $1.50 has opened. 

They have generated over 20X growth in share price for early shareholders, with significant upside remaining as they just launched in over 100 Best Buy stores.

Retail distribution was the main driver behind the acquisitions of both Ring and Nest, and their exclusive deal with Best Buy puts them in pole position to dominate this burgeoning industry.

💵 Personal Finance

All about dividend investing

Want to make money? 💴 

Try dividend investing.

What is it? It involves buying stocks that pay hefty dividends.

Who is it for? The strategy is said to be suitable for people interested in a regular flow of income.

🛑 A dividend is a distribution of profits by a corporation to its shareholders. When a corporation earns a profit or surplus, it is able to pay a portion of the profit as a dividend to shareholders. Any amount not distributed is taken to be re-invested in the business. Dividends are usually paid every quarter.

Warning ⛔️: Dividends aren’t guaranteed. Just because a company is producing dividends doesn’t always make it a safe bet.

Which companies to invest in?

The dividend aristocrats—companies that have increased their dividends annually over the past 25 years—are often considered safe companies because they’ve stood the test of time.

Here are some of the top aristocratic dividend stocks this year😀 

But stop 🛑, high yield is not always good – it might be a sign of distress. Companies in trouble often pay dividends to avoid negative news and avoid questions from investors.

🐇 Like a magician misdirecting with a poof of smoke while he pulls a rabbit out from behind the stage.

What to consider when choosing a company for dividend investing

Don’t just look at the yield because it may not be the best indicator.

  • Companies with long-term profitability and earnings growth expectations between 5% and 15%. But, again, remember that more is not always good. Companies with very high profitability often experience earnings disappointments, which almost always nicks the stock price.

  • Stay away from dividend-paying companies that are saddled with excessive debt. , i.e. avoid companies with high debt-to-equity ratios – anything above 2 is considered poor.

  • Don’t just look at the company but at the entire sector. A sector that’s set to boom might be a better investment. For example, the aging population indicates a boom for the healthcare sector.

How to start investing?

Here’s how:

  • ☝️ The first step is to choose a stock you’re interested in.

  • 👌 The next step is to decide how much you wish to spend.

  • 👊 Next, add the stock to your portfolio and the dividend will get added to your account (automatically) whenever announced.

Income ETFs are designed to pay out dividends. Accumulation ETFs, however, do not pay a dividend.

💰 Be a Better Investor

"With a good perspective on history, we can have a better understanding of the past and present, and thus a clear vision of the future."

Carlos Slim Helu

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