AT&T Stock Can Still Offer a Reward If You Know Where to Look

The problems for AT&T (NYSE:T) stock started in 1999. It embarked on a hideous descending channel that hasn’t stopped yet. T stock is now 55% below its all time highs from January, 22 years ago.

a photo of the AT&T office buildingSource: Roman Tiraspolsky / Shutterstock.com

It hasn’t all been downhill, as it has had great upswings along the way. But they all turned out to be scalping opportunities.

One thing these positive stints had in common was a solid base. That’s the opportunity from here and for the next six months.

There is a good chance that the sellers need a rest, and that the floor will hold. If the fans can keep it above $26 per share, they have a shot at building a base. The upside target could extend to $37 per share, but with tremendous resistance starting near $31.

T Stock Basing for the Upside Potential AT&T (T) Stock Chart Showing Base PotentialSource: Charts by TradingView

There aren’t specific catalysts in the shorter term that suggest this is imminent. Patience is key for now as the bears are in charge of the action. T has set a series of lower-lows and lower-highs. What’s worse is that they are losing $27.50, which could usher in another $2 drop from here.

Therefore, the thesis might take a few weeks to unfold – and there is no rush. This is especially true since markets will be jittery going into the Federal Reserve’s event at Jackson Hole this week.

7 Coronavirus Stocks to Buy in Case of Lockdown 2.0

I am not a perma-bull for this stock, so it’s an honest assessment of the situation. In fact, on June 8 I suggested avoiding T stock, and it fell 6% after that. It always a matter of risk reward for me, and I revisit it now from this lower level.

Fundamentally, the concept is still the same where management is in repair mode. It’s not that they had one giant mistake, but they need to refocus their efforts.

Management Has Work to Do

The fundamentals for AT&T are in shambles. First, the top line is stagnant while other mega-caps are growing leaps. Second, the net income went from $29.5 billion in 2017, to losing $2 billion now. Clearly there is long term risk if they don’t right this ship.

Luckily, they are still a giant, and they generate a ton of cash flows from operations. Therefore, they can feed the machine until they realign with current trends. This somewhat reminds me of the situation with General Electric (NYSE:GE). Management there lost its bearings for a while, so T can still fix things. The trick is to do it before the point of no return.

GE did it, now it’s AT&T’s Turn. All T stock needs to find buyers is strong sentiment. GE doesn’t yet have great results yet, but the message is clear. AT&T needs to streamline the talking points to woo experts back. The stock will recover much faster than the actual bottom line.

And then there is the dividend and it’s a whopper at 7% reward. This puts it in the category of Exxon (NYSE:XOM) and Chevron (NYSE:CVX) but not quite. AT&T recently cut theirs, and nothing is stopping them from doing it again. In the absence of fixed-income alternative, it is relatively substantial still.

Why Now?

The five-year floor is just below T stock. If they can avoid big headline flubs, then they can bounce off it one more time. Management needs to avoid the increment hiccup. In the case of Chevron and Exxon, both managements publicly supported their dividends. AT&T needs to do something similar.

The global central banks are likely to keep yields suppressed. Therefore, the dividend draw to stocks is key. Yes, we are facing the possibility of the Fed announcing the taper this fall. But they are far from raising rates.

The opportunity today is to add T stock to the portfolio. First for the fixed income but second for the potential 20% swing trade reward. There is an important caveat for dividend headline risk. I don’t get the same sense of management commitment as say with CVX or XOM.

As the facts change, investors need to flex. I’ve been consistently chasing the swings in T stock. I am for it like the opportunity now, or back in 2019. My goal is usually to first avoid easy mistakes, and then identify rally potentials. If markets hold up the this should work.

On the date of publication, Nicolas Chahine did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

Nicolas Chahine is the managing director of SellSpreads.com.

Why the corporate debt boom isn’t less risky because stocks are near records

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Wall Street has been kicking around an nifty idea: With U.S. stock indexes hitting new records, the fourfold increase of debt loaded onto American companies over the past 30 years might look less alarming.

The thinking goes that while U.S. companies now have more debt than ever before, the runup in company stock prices has been greater. And in a selloff scenario, lofty stock prices might provide a shock buffer for bonds.

Heres a chart from BofA Global showing the debt of major U.S. companies since the 1970s in relation to equity market value, pegging the current ratio at a low 25%:

There has been a lot of concern about the fact that the amount of U.S. corporate financial debt (bond and loans) has more than quadrupled (to $11.2 trillion from $2.5 trn over the past three decades, Hans Mikkelsens credit team at BofA wrote, in a note.

However, as the market value of equity far outpaced that growth, leverage measured as financial debt divided by market value of equity now stands at a record low of 24.9%.

Thats prompted claims that U.S. corporate bond and loan investors have never been backed by more equity value, he wrote.

MarketWatch asked several bond investors about those claims, including whether lofty share prices actually can make U.S. corporate debt safer for investors. Heres what a couple of portfolio managers had to say:

Im not super focused on the stock price, said Wendy Wyatt, a portfolio manager focused on corporate credit at DuPont Capital, in a phone interview. Its the debt, and the amount of debt relative to earnings, that is what matters. And that number has been increasing.

Wyatt also said it isnt only increased debt levels that count as concerns, but also lower spreads and a longer duration, with the sectors main corporate bond index now averaging about 8.5 years, up from five or six in the past.

In other words, bond investors face getting paid less spread, even though it will tak! e longer to be repaid.

Spreads are the premium investors earn on bonds above a risk-free benchmark, like Treasurys, to compensate for default risks. That level has plunged since the Federal Reserve last year began buying corporate debt for the first time ever, as part of its bazooka of pandemic support for the U.S. economy.

Spreads now sit nearly 93 basis points above Treasurys TMUBMUSD10Y, 1.347% for the benchmark investment-grade index, or less than 10 basis points off the post-2008 lows in June. Similarly, below-investment-grade, junk bond, spreads were slightly above recent lows, but still historically low, nearly 322 basis points above Treasurys.

For stocks, it has been roughly 10 months without a significant pullback. Thats pushed the S&P 500 index SPX, -0.58% to 51 record closes this year, but also to advance 100% from its March 2020 bear-market low, according to Dow Jones Market Data.

The fact that capital is finding its way into growth sectors is a meaningful message, probably in part as a function of the Feds largess, said Stephen Repoff, fixed-income portfolio manager at GW&K Investment Management.

More important though, the Fed also unleashed a refinancing wave that helped companies reduce borrowing costs and push maturities down the road during the pandemic, so defaults become less of a near-term concern, he said.

And unlike stocks, where investors often buy based on growth expectations, getting back their investment plus a little extra remains a chief concern of many bond investors.

What might the debt-to-equity market value boil down to best? Maybe its a measure of sentiment.

It you are using the metric as a buy signal, you care if it switches to a sell metric, Repoff said.

Wyatt at DuPont Capital said it also cant hurt investment banks to have positive metrics to show investors heading into the fall.

Some of these charts are interesting, she said. But we all know we are going to get a huge amount of issuance in September.

From the archives: Corporate bond issuance off to a bang in September

Top 10 Gold Stocks To Watch Right Now

The world's largest asset manager BlackRock (NYSE:BLK) has joined the equity swaps network Veris, developed by blockchain company Axoni.

According to a recent announcement, the $9.5-trillion giant is in good company in using Veris considering that Citigroup Inc. (NYSE:C) and Goldman Sachs Group Inc. (NYSE:GS) have already joined the network.

BlackRock will use Axoni's platform to match trades and confirm all of its terms upfront and keep all parties synchronized on post-trade events including amendments, positions and cash flows through the lifecycle of the swap.

Axoni's service will help the firm “build scalability while mitigating risks in the investment life cycle beginning with equity swaps,” said Mark Cox, COO of global investment operations at BlackRock.

Axoni said the deal “comes after years of engagement” with the asset management behemoth and other financial institutions “evaluating the use of a distributed ledger network for the post-trade management of derivatives, beginning with equity swaps.” The firm's head of OTC Markets Carl Forsberg highlighted that BlackRock joining the platform is important since sell-side participants will benefit from the participation of a top swap counterparty.

Top 10 Gold Stocks To Watch Right Now: CME Group Inc.(CME)

CME Group Inc. operates the CME, CBOT, NYMEX, and COMEX regulatory exchanges worldwide. The company provides a range of products available across various asset classes, including futures and options on interest rates, equity indexes, energy, agricultural commodities, metals, foreign exchange, weather, and real estate. It offers various products that provide a means of hedging, speculation, and asset allocation relating to the risks associated with interest rate sensitive instruments, equity ownership, changes in the value of foreign currency, credit risk, and changes in the prices of commodities. CME Group owns and operates clearing house, CME Clearing, which provides clearing and settlement services for exchange-traded contracts and counter derivatives transactions; and also engages in real estate operations. Its primary trade execution facilities consist of its CME Globex electronic trading platform and open outcry trading floors, as well as privately negotiated transact ions that are cleared and settled through its clearing house. In addition, the company offers market data services comprising live quotes, delayed quotes, market reports, and historical data services, as well as involves in index services business. CME Group?s customer base includes professional traders, financial institutions, institutional and individual investors, corporations, manufacturers, producers, and governments. It has strategic partnerships with BM&FBOVESPA S.A., Bursa Malaysia Derivatives, Singapore Exchange Limited, Green Exchange, Dubai Mercantile Exchange, Johannesburg Stock Exchange, and Bolsa Mexicana de Valores, S.A.B. de C.V., as well as joint venture agreement with Dow Jones & Company. The company was formerly known as Chicago Mercantile Exchange Holdings Inc. and changed its name to CME Group Inc. in July 2007. CME Group was founded in 1898 and is headquartered in Chicago, Illinois.

Advisors’ Opinion:

  • [By ]

    Cboe Global Markets  (CBOE) – Get Report shares rose Wednesday, after a report that competing financial-securities exchange CME Group  (CME) – Get Report has proposed buying it for almost $16 billion in stock.

  • [By James Brumley (TMFjbrumley)]

    At its peak price on Wednesday, Cboe Global Markets (NYSEMKT:CBOE) stock was up more than 9% in response to whispers it was to be acquired by fellow exchange CME Group (NASDAQ:CME). Shares were back near break-even levels for the day, however, after CME Group denied the rumor.

Top 10 Gold Stocks To Watch Right Now: Northgate Minerals Corporation(NXG)

Northgate Minerals Corporation, together with its subsidiaries, engages in exploring, developing, processing, and mining gold and copper deposits in Canada and Australia. Its principal producing assets include 100% interests in the Fosterville and Stawell Gold mines in Victoria, Australia; and the Kemess South mine located in north-central British Columbia, Canada. The company was formerly known as Northgate Exploration Limited and changed its name to Northgate Minerals Corporation in May 2004. Northgate Minerals Corporation was founded in 1919 and is headquartered in Toronto, Canada.

Advisors’ Opinion:

  • [By Shane Hupp]

    Shares of NEX Group PLC (LON:NXG) have been given an average rating of “Hold” by the nine ratings firms that are presently covering the company, Marketbeat.com reports. One research analyst has rated the stock with a sell recommendation, four have assigned a hold recommendation and four have assigned a buy recommendation to the company. The average 1 year price objective among analysts that have issued ratings on the stock in the last year is GBX 696 ($9.21).

Top 10 Gold Stocks To Watch Right Now: Orezone Gold Corp (ORE)

Orezone Gold Corporation is a Canada-based company engaged in the exploration and development of gold properties in Burkina Faso, West Africa. The Company has two advanced-stage gold projects, which include Bombore and Bondi, which are located in Burkina Faso. The Company owns a 100% interest in Bombore, the undeveloped oxide gold deposit in West Africa. The Company’s Bombore is situated approximately 85 kilometers east of the capital city, Ouagadougou. The company’s Bondi gold project is a 100% owned, shallow and structurally controlled, four kilometers long shear zone hosted gold deposit that contains 282,000 ounce (oz) of measured and indicated gold resources. The Company’s Bondi Project is located on the Hounde Greenstone Belt in the southwest of Burkina Faso covering an area of approximately 168 square kilometers. Advisors’ Opinion:

  • [By Shane Hupp]

    Galactrum (ORE) is a PoW/PoS coin that uses the
    Lyra2RE hashing algorithm. It was first traded on December 13th, 2017. Galactrum’s total supply is 2,781,952 coins and its circulating supply is 2,061,952 coins. Galactrum’s official website is galactrum.org. Galactrum’s official Twitter account is @galactrum.

  • [By Stephan Byrd]

    Galactrum (CURRENCY:ORE) traded 1.7% lower against the U.S. dollar during the 24 hour period ending at 18:00 PM Eastern on August 31st. Galactrum has a total market capitalization of $866,847.00 and approximately $5,272.00 worth of Galactrum was traded on exchanges in the last 24 hours. One Galactrum coin can now be purchased for about $0.42 or 0.00006032 BTC on major exchanges including Stocks.Exchange and Cryptopia. In the last seven days, Galactrum has traded 12.5% higher against the U.S. dollar.

  • [By Peter Graham]

    Sandstorms due diligence is thorough, they dont just invest in any company. They like West Africa because they understand the area and the opportunities that exist there. Sandstorm is a royalty and streaming company, so they make these investments and receive cashflow deals that often kick in much later on. But they have already established a presence in Burkina and have deals in place with larger companies like Orezone Gold (TSXV: ORE) and Endeavour Mining (TSX: EDV). Sandstorms investment also potentially gives us access to their marketing department through something they call Launch Lab, and it looks like it will really benefit our own marketing efforts and will expose us to more opportunities over the coming year.

  • [By Jim Robertson]

    Finally, Richard Seville, the CEO of Brisbane-based Orocobre Ltd (ASX: ORE) which began lithium sales in 2015 from northern Argentina and also experienced difficulty boosting output, commented that an inability to access traditional funds has delayed the development of the sector and that these projects arent easy — so the banks just dont want to go there.

Top 10 Gold Stocks To Watch Right Now: Golden Star Resources Ltd(GSS)

Golden Star Resources Ltd., a gold mining and exploration company, through its subsidiaries, engages in the acquisition, exploration, development, and production of gold properties. It owns and operates the Bogoso/Prestea gold mining and processing operation that covers approximately 40 kilometers of strike along the southwest-trending Ashanti gold district in western Ghana; and the Wassa open-pit gold mine located to the east of Bogoso/Prestea in southwest Ghana. The company also has an 81% interest in the Prestea underground gold mine located in Ghana. In addition, it holds interests in various gold exploration projects in Ghana, Sierra Leone, Burkina Faso, Niger, and Cote d?Ivoire, as well as holds and manages exploration properties in Brazil in South America. The company was founded in 1984 and is based in Littleton, Colorado.

Advisors’ Opinion:

  • [By Max Byerly]

    Get a free copy of the Zacks research report on Golden Star Resources (GSS)

    For more information about research offerings from Zacks Investment Research, visit Zacks.com

  • [By Max Byerly]

    Golden Star Resources Ltd. (NYSEAMERICAN:GSS) was the target of a significant increase in short interest in September. As of September 28th, there was short interest totalling 10,021,831 shares, an increase of 6.9% from the September 14th total of 9,371,344 shares. Based on an average trading volume of 1,038,207 shares, the short-interest ratio is presently 9.7 days. Approximately 4.7% of the company’s shares are sold short.

  • [By Joseph Griffin]

    Golden Star Resources Ltd. (TSE:GSC) (NYSE:GSS) has been given an average recommendation of “Buy” by the six ratings firms that are presently covering the stock, Marketbeat reports. One research analyst has rated the stock with a hold recommendation and three have issued a buy recommendation on the company. The average 12 month price objective among analysts that have issued ratings on the stock in the last year is C$1.48.

Top 10 Gold Stocks To Watch Right Now: NEW GOLD INC.(NGD)

New Gold Inc. engages in the acquisition, exploration, extraction, processing, and reclamation of mineral properties. The company primarily explore for gold, silver, and copper deposits. Its operating properties include the Mesquite gold mine in the United States; the Cerro San Pedro gold-silver mine in Mexico; and the Peak gold-copper mine in Australia. The company also has development projects, including the New Afton gold, silver, and copper project in Canada; and a 30% interest in the El Morro copper-gold project in Chile. The company was formerly known as DRC Resources Corporation and changed its name to New Gold Inc. in June 2005. New Gold Inc. was founded in 1980 and is headquartered in Vancouver, Canada.

Advisors’ Opinion:

  • [By Ethan Ryder]

    ILLEGAL ACTIVITY NOTICE: “New Gold Inc (NGD) Short Interest Down 3.5% in March” was published by Ticker Report and is owned by of Ticker Report. If you are reading this story on another domain, it was copied illegally and republished in violation of United States & international trademark & copyright legislation. The legal version of this story can be accessed at www.tickerreport.com/banking-finance/4282582/new-gold-inc-ngd-short-interest-down-3-5-in-march.html.

  • [By Ethan Ryder]

    New Gold (NYSEAMERICAN:NGD) had its price objective lowered by analysts at Royal Bank of Canada from $1.25 to $1.00 in a research report issued on Wednesday. The brokerage currently has an “underperform” rating on the basic materials company’s stock. Royal Bank of Canada’s target price indicates a potential upside of 14.50% from the stock’s current price.

Women Who Make More Than Their Husbands Should Watch Out

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When women out-earn their husbands, marriages struggle. Marriages of female breadwinners are 50% more likely to end in divorce, according to a University of Chicago study.

Retirement and Divorce: Protecting Your Finances When Marital Bliss Turns Sour

Many relationships that do not conform to the traditional norm of the man playing the role of provider do not fare well. The University of Chicago study points to several reasons, including tension between the partners, due to a combination of societal expectations of men and deep-seated ideas about gender roles, leading to arguments.

Men Who Cheat on Their Breadwinning Wives

Studies also show that when a wife out-earns her husband, he is more likely to cheat. In fact, about 15% of the men in a study by the American Sociological Review who were 100% financially dependent on their wives had affairs. Thats three times higher than the 5% of high-earning wives who strayed, the study showed.

For men, financial dependence may be particularly threatening, resulting in relationship-sabotaging behavior, and c! heating may be a subliminal way to bolster his self-esteem or re-establish his sense of masculinity. While infidelity is not necessarily a death sentence for a marriage, it is the most often-reported reason for a split.

Over 50 and Considering Divorce? How to Prepare Financially, Pre- and Post-Separation

It's not exactly logical,” according to Alexandra Shepis, a Certified Divorce Financial Analyst庐 with Francis Financial who provides financial advice to many breadwinning women. If you are financially dependent on your spouse, you probably should not cheat on them. But rarely do finances dictate matters of the heart.”

In addition, Shepis warns that a divorce for breadwinning women can be especially painful, as the law dictates that she pay spousal support to him if her earnings are significantly greater. This can be an especially tough pill to swallow for a woman whose husband had an affair while she spent long hours at the office working to provide for him.

Who Gets Stuck with the Housework?

Lisa Zeiderman, a divorce attorney and managing partner for Miller Zeiderman LLP, often represents the breadwinner female spouse. According to Zeiderman, many of these women are high-powered executives who not only support their family but also care for the children. Notwithstanding that they are earning a substantial income, these women still manage to run the household, including, but not limited to, sourcing the childrens providers, arranging for childcare, making playdates, attending school functions and making sure there is a family meal and bedtime routine.

Zeiderman contends that these women should receive a greater share of equitable distribution due to their greater contributions to the family unit. Moreover, while they may have to pay alimony, that may be set off by a greater distributions of assets. While in some marriages there is no affair, the breadwinning woman may still feel as if she is not supported enough, deepening conflicts and causing ! resentmen! t that can escalate into arguing and, ultimately, divorce. Moreover, as set forth above, breadwinning women often end up doing a disproportionate amount of housework.

According to the Journal of Family Issues, the more economically dependent that men are on their wives, the less housework they do. Even women with unemployed husbands spend considerably more time on household chores than their spouses. In other words, the more the wife earns, the greater the penalty at home. Therefore, as Zeiderman points out, the greater the reward should be when dividing up the marital pot.

As with any issue, couples need to be willing and able to honestly discuss the reality of the woman being the primary breadwinner, says Beatty Cohan, psychotherapist, sex therapist and author. Issues including the division of labor on day-to-day tasks,including childcare, grocery shopping, housecleaning, etc. need to be acknowledged, addressed and resolved. The couple needs to be open to ongoing evaluation about how the process is actually working. Compromise, trade-offs andwin/win solutions should be the goal when challenges arise … as they inevitably will.

Tips to Help Maintain a Happy Marriage

On the financial front, successful marriages have regular, open communication about finances. This is especially important when gender-earning norms are reversed. Shepis advises couples to plan a financial date night and craft a financial plan that takes into account their goals.

Large gaps in income can cause tension in the relationship, and if money is a taboo subject, the odds will be stacked against you. On the other hand, getting on the same page, financially, and working together towards your shared dreams is one of the most important ways to strengthen your relationship and ensure your happily ever after.

Is Your Spouse a Financial Bully? Subtle Signs of Abuse to Watch forThis article was written by and presents the views of our contributing adviser, not the Kiplinger editorial! staff. Y! ou can check adviser records with the SEC or with FINRA.About the AuthorStacy Francis, CFP庐, CDFA庐, CES

President & CEO, Francis Financial Inc.

Stacy is a nationally recognized financial expert and the President and CEO of Francis Financial Inc., which she founded 15 years ago. She is a Certified Financial Planner庐 (CFP庐) and Certified Divorce Financial Analyst庐 (CDFA庐) who provides advice to women going through transitions, such as divorce, widowhood and sudden wealth. She is also the founder of Savvy Ladies, a nonprofit that has provided free personal finance education and resources to over 15,000 women.

The One mRNA Vaccine Stock to Buy Today

Michael A. RobinsonMichael A. RobinsonMichael A. Robinson

For two months now, biotech companies have been talking about the eventual need for a coronavirus vaccine booster in at least some segments of the population.

Just this past weekend, the U.S. Food and Drug Administration recommended additional doses of the joint Pfizer Inc. (NYSE: PFE) and BioNTech SE ADR (NASDAQ: BNTX) vaccine and the Moderna Inc. (NASDAQ: MRNA) vaccine for some immunocompromised people.

Yesterday, sources inside the Biden administration told USA Today that the government is planning to recommend vaccine booster shots for all Americans no sooner than eight months after they received their second shot of either mRNA vaccine.

And of course, there are broadening vaccine “mandates,” too, all over the public and private sector, such as the Pentagon’s requirement that most of the country’s 1.3 million military personnel get vaccinated.

That puts the so-called “vaccine stocks” – the handful of biotech firms that developed effective coronavirus vaccines last year then skyrocketed accordingly – right back into play.

This time the game board is different. There’s the highly infectious SARS-CoV-2 B.1.617.2 “delta variant” to contend with, and the unsettling prospect of other, potentially more dangerous variants, too.

More importantly, there’s a different product pipeline now, and new applications for the vaccine technology that’s proven itself under fire and is on the way to becoming the new gold standard for many vaccines and therapies still on the way.

Conditions are looking good for another, potentially bigger round of profits for folks who buy the right vaccine stock, and I think one company looks better than the rest this time…

Make No Mistake: These Vaccines Are Effective

The media is full of reports of “breakthrough” COVID-19 infections in fully vaccinated individuals, but many lack the important context that puts breakthrough infections into perspective.

And that context is this…

The Wall Street Journal, analyzing reports from 45 state health departments, counted around 193,204 infections in vaccinated individuals between January and early August, 2021. Those infections represent just 0.1% – one-tenth of one percent – of the 136 million-plus vaccinated Americans. Less than 0.004% of those vaccinated folks with breakthroughs had to be hospitalized, and less than 0.001% of them died.

Anecdotally, on a personal note, I’ve had seven fully vaccinated friends come down with the coronavirus, but none of them were sick at all. One didn’t even know she had it until she got a positive result from a routine test.

So, while no vaccine on Earth is 100% effective against any virus, clearly, these vaccines are extremely effective at keeping people alive and out of the hospital, even accounting for delta variant infections.

A big reason for this effectiveness, not to mention the world-record speed at which they went from the drawing board into hundreds of millions of arms, is messenger RNA (mRNA) technology.

The Tech Behind the Vaccine “Moonshot”

Of the “Big Three” coronavirus vaccines currently authorized for use in the United States, two were developed using this new biotech – a completely new way of teaching the human body to fight off a virus that to date has infected at least 208 million people and killed at least 4.37 million of them.

I want to be absolutely clear: The vaccine doesn’t actually affect your body’s genetic code. Your DNA is unaffected.

Instead, these vaccines work using what’s called messenger RNA, or simply mRNA.

In short, when your cells create proteins out of their DNA, they don’t use the DNA directly. Instead, cells transcribe their DNA into RNA, a similar compound. The cell’s protein factories then translate the RNA into proteins, destroying the RNA in the process.

The mRNA vaccines use this process to, essentially, “trick” cells into creating specific proteins that make the cells look as if they have been infected by something – in this case, the SARS-C0V-2 “spike protein” the virus uses to infect cells.

But that’s an illusion. Your cells are perfectly healthy; your DNA never changes. What’s more, the mRNA in the vaccine degrades quickly, within a matter of days. Messenger RNA is extremely fragile, which is why the mRNA vaccines need to be kept at super-low temperatures.

The spike proteins generated by the COVID-19 vaccines last a few weeks, but very quickly, your immune system learns to identify, attack, and kill them. That’s a lesson the body remembers, so most folks’ immune systems will know how to identify, attack, and kill the real McCoy if or when the time comes.

This technology is a game changer – mRNA vaccines sidestep many of the concerns about vaccines that use live, inactive, or attenuated viruses or components of viruses, which in rare cases can infect the people they’re meant to protect.

They’re also much, much faster to produce at scale. Before mRNA vaccines, the Merck Mumpsvax mumps vaccine was the reigning “speed record holder” in the vaccine arena, and it took nearly four years to go from the drawing board to the market. And, as we all know, the first mRNA vaccines were being administered barely one year after SARS-CoV-2 emerged.

It’s thought that as many as 320,000 virus species can infect mammals, and as of today, science knows of around 219 species able to infect humans, from common colds to the deadly Ebola. There’s always a risk that a 220th will emerge to wreak havoc on society. Messenger RNA vaccine tech is humanity’s “ace in the hole” against an unwelcome development like that.

The COVID-19 pandemic lit a fire under the already promising field of mRNA vaccine research, but research into their use against influenza, rabies, Zika virus, and cytomegalovirus was far along when COVID-19 began to shut the world down in March 2020.

This Biotech Firm Was Always an mRNA Leader

Moderna was further along in its research than just about anyone else, but that’s not the only reason I’m recommending it today.

The company was founded in Cambridge, Massachusetts, in 2010 with the goal of commercializing mRNA technology. Moderna shares only listed in 2018, though, about two years before its breakthrough vaccine would make it a household name.

It was the focus on mRNA tech that enabled Moderna to pivot from its other avenues of research to COVID-19 so quickly.

But I don’t think people understand just how breathtakingly fast that pivot was…

Chinese scientists published the full genetic sequence of SARS-CoV-2 in early January of 2020. Moderna, which, as I said, was a leader in mRNA vaccine research, was first out the gate with a list of promising vaccine candidates – and a test dose of COVID-19 vaccine – just 63 days after the genetics information hit the Internet.

It’s true that the Pfizer-BioNTech partnership was first, by a week or so, to gain authorization for its mRNA vaccine, but its “edge” over Moderna in that one sense was limited, and investors clearly preferred Moderna, a fact that comes across when you compare stock charts for the past year.

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Both mRNA vaccines are great, and one is about as effective as another, but it’s what’s coming next that’s likely to cement Moderna’s position as the vaccine stock to own.

As you read this, Moderna is hard at work developing 24 additional vaccine candidates – over and above its continuing research into the COVID-19 vaccine and how it could be tweaked to better ward off variants.

Among these candidates is an annual vaccine booster for 2023 and beyond. Existing flu vaccines are anywhere from 40% to 60% effective at preventing severe disease – this qualifies as “good” protection, but Moderna is working to move the needle into “Excellent” territory. The company is also working on vaccines for HIV and respiratory syncytial virus (RSV). RSV is coming back in force as societies reopen, and it’s beginning to show up out of season, too. The respiratory virus can seriously harm infants, toddlers, and the elderly.

Beyond the vaccine sphere, Moderna is developing 13 different mRNA treatments, including five for cancer; it has two autoimmune therapies in clinical trials at this point.

So Moderna is anything but a one-hit wonder whose stock has already “popped.” If, for whatever reason, you missed MRNA shares’ big rocket ride, there’s still much more to come.

This company has the kind of pipeline that can generate billions in sales over the next decade and beyond.

With all that said, it’s undeniable earnings growth over the last three years has been weak; the company has understandably plowed so much capital into R&D. But in the quarter ending in June, Moderna earned $6.46 per share compared with a year-ago loss and came on the back of a 6,400% sales increase.

Moderna also raised forecasts for the year. For 2022, it has already signed contracts to deliver $12 billion worth of COVID-19 vaccines. Not only that, but clients have options to purchase more doses worth roughly $8 billion.

To be conservative, let’s project that per-share profits average 25%. At that rate, earnings will double in about 33 months – and, being conservative, that doesn’t account for the likelihood of a Moderna breakthrough on any one of the several trials and lines of research it’s working on.

This progress isn’t happening in a vacuum. All over the world, but particularly here in the United States, we’re seeing an explosion in creativity. Whether it’s getting a lifesaving vaccine to market in record time, or delivering some other game-changing tech breakthrough, can-do spirit, good old-fashioned entrepreneurialism (and hundreds of billions of dollars in fresh capital since November 2020) are combining in an explosion of profit potential.

No wonder, then, that there are more than 500 private companies of all kinds looking to go public in the United States right now. This can be the best time to claim a stock in these companies using something called “pre-IPO rights.” It’s possible to claim these for $1 in many cases, but, should the company go public, these rights can have stratospheric profit potential – peak gains of 2,088%, 6,566%, 8,280%, 9,075%, even 27,550% have been realized in exceptional cases. You can learn some more about these remarkable instruments here…

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Michael A. RobinsonMichael A. RobinsonMichael A. Robinson

About the Author

Browse Michael’s articles | View Michael’s research services

Michael A. Robinson is a 36-year Silicon Valley veteran and one of the top tech and biotech financial analysts working today. That’s because, as a consultant, senior adviser, and board member for Silicon Valley venture capital firms, Michael enjoys privileged access to pioneering CEOs, scientists, and high-profile players. And he brings this entire world of Silicon Valley “insiders” right to you…

He was one of five people involved in early meetings for the $160 billion “cloud” computing phenomenon. He was there as Lee Iacocca and Roger Smith, the CEOs of Chrysler and GM, led the robotics revolution that saved the U.S. automotive industry. As cyber-security was becoming a focus of national security, Michael was with Dave DeWalt, the CEO of McAfee, right before Intel acquired his company for $7.8 billion.

This all means the entire world is constantly seeking Michael’s insight.

In addition to being a regular guest and panelist on CNBC and Fox Business, he is also a Pulitzer Prize-nominated writer and reporter. His first book Overdrawn: The Bailout of American Savings warned people about the coming financial collapse – years before the word “bailout” became a household word.

Silicon Valley defense publications vie for his analysis. He’s worked for Defense Media Network and Signal Magazine, as well as The New York Times, American Enterprise, and The Wall Street Journal.

And even with decades of experience, Michael believes there has never been a moment in time quite like this.

Right now, medical breakthroughs that once took years to develop are moving at a record speed. And that means we are going to see highly lucrative biotech investment opportunities come in fast and furious.

To help you navigate the historic opportunity in biotech, Michael launched the Bio-Tech Profit Alliance.

His other publications include: Strategic Tech Investor, The Nova-X Report, Bio-Technology Profit Alliance and Nexus-9 Network.

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