Wyatt Research Week in Review: Jan. 31-Feb. 6

The Silicon Valley search king ascended the Wall Street throne Tuesday, only to see its crown stolen back Wednesday by the longstanding titleholder.
I refer to Google – ahem, Alphabet (NASDAQ: GOOGL) – and Apple (NASDAQ: AAPL).
On Monday afternoon, the crown jewel of the Alphabet empire reported annual revenue growth of 14% in its core Internet operations, with operating income up 23% year-over-year.
The Street liked what it saw, sending Alphabet shares up 3% in early Tuesday trading. That was good enough to lift its market capitalization past Apple to become the world’s most valuable company.
But in Wednesday’s rematch, Apple – which had seen its fortunes wane since forecasting a current-quarter revenue decline last week – eked out a 2% share-price gain, compared to Alphabet’s 4% drop, and once again topped its challenger in the market cap prizefight.
In the long-term scheme of things, those percentage fluctuations mean nothing among companies whose market caps are both around $500 billion. It could very well continue to be a seesaw battle throughout 2016 – which might actually be a good thing for the companies’ respective shareholders.
As Steve Mauzy pointed out in Wednesday morning’s issue of Income & Prosperity, “Microsoft (NASDAQ: MSFT) was the first company to see its market cap exceed $500 billion, in late 1999. Given the immense popularity of most everything technology related, pundits speculated that it was only a matter of time before Microsoft’s market cap exceeded $1 trillion. But just as the speculative fervor hit its crescendo, Microsoft ran out of steam.”
While Microsoft never jumped that elusive $1 trillion hurdle, the last time I checked the world’s third-largest company is doing just fine.
So while Google bulls might bemoan its slip from the market-cap summit, sometimes it’s better to slip under the scrutiny that comes with the Wall Street limelight.
Here are some of my other favorite Wyatt Investment Research articles of the week:
Top 5 Dividend Increases for February – We’re less than two months into 2016 and things have been quite rocky, with the S&P 500 index down 8% year-to-date. But companies that offer investors consistent dividend increases continue to outperform the S&P.
Will J&J Take M&A Action in 2016? – Johnson & Johnson (NYSE: JNJ) has sat out the merger-and-acquisition frenzy that has been going on in the health care sector since 2014. But with its huge cash pile and low debt, J&J is poised to take significant M&A action in 2016, most likely in its pharmaceutical division.
Time to Buy This Dividend Aristocrat and Its 4% Yield – If past is prologue, whenever a Dividend Aristocrat goes on sale, it’s nearly always a worthwhile buying opportunity. We’re seeing one of those opportunities now in a company that has increased its dividend each year for the past 59 years.
Canadian Oil Sands Industry in a Sticky Mess – On Jan. 18, Suncor Energy (NYSE: SU) finalized a $4.6 billion takeover deal for Canadian Oil Sands Ltd. (OTC: COSWF). At the moment, this deal makes Suncor a very brave and very lonely company. That’s because investment into Canada’s energy is falling off a cliff.
A Cheaper Way to Buy Cheap Oil – Wyatt Research analyst Andy Crowder is a contrarian investor at heart. So when he sees the United States Oil Fund (NYSEArca: USO) down roughly 75%-80% since its highs in mid-2014, he’s not passing up the opportunity. But Andy’s not just placing a market order. Instead, he’s doing this.
Should You Buy European Stocks on Stimulus Hopes? – If you trust European Central Bank President Mario Draghi’s stated commitment to economic stimulus, you may want to take a closer look at European stocks.
Gold Prices Trying to Break Long-Term Downtrend – Gold prices have been stuck in a downtrend, falling from an all-time high of $1,923.70 in September 2011 to below $1,050 an ounce in December 2015. However, a rally in the last few weeks has the precious metal facing resistance, and if it can break through it will end the downtrend.
Is the AIG Reorganization Enough? – American International Group (NYSE: AIG) announced a major reorganization last week, but will it be enough to finally push the stock above $65 a share – something the company hasn’t seen since before the 2008 financial crisis? Carl Icahn doesn’t think so.
Have a great weekend!