VIDEO: A Sector With a Fighting Chance at Long-Term Profits
If one word could sum up the investing atmosphere right now, “tense” comes to mind.
But tension isn’t just a presence across financial markets … at this moment, it’s a central theme of global affairs.
Understanding tense undercurrents and their effects on investments is a decades-long specialty of Senior Analyst Tony Sagami.
Tony is the editor of Disruptors & Dominators and Weiss Ultimate Portfolio.
Both trading services focus on breakthrough technologies and trends, and stocks that prioritize safety and profitability.
Tony has been leading investors to gains by stacking his portfolios with stocks leveraged to tension, so to speak.
What’s a big source of some of this strain? Inflation!
When the Consumer Price Index data was released just days ago, it showed inflation at a punishing 9.1% — the worst since 1981.
Over the last 12 months, the food-at-home index rose 12.2% and gasoline has skyrocketed 59.9%.
Inflation isn’t just a problem in the U.S., but a growing one around the world, and Tony notes other pressures to contend with:
In the U.S., we have tension about inflation and high gas prices.
In Ukraine, there’s tension about escalating violence from Russian incursions.
In China, we have increasing tension there.
The Chinese navy is expanding their presence in the South China Sea. Just a couple of weeks ago, they launched their third aircraft carrier. Think about that: they went from zero to three aircraft carriers in less than 20 years.
What do you think the U.S. is going to do? Are they going to sit back and watch China gain maritime supremacy? Not a chance.
That could mean even more momentum to a bullish trend: profitability in defense stocks.
In fact, military defense is an industry that’s guaranteed to see a rise in spending for the foreseeable future … and U.S. contractors have little competition.
Among the top reasons the market is expanding: escalating violence in Ukraine, and two Nordic countries inching closer to being North Atlantic Treaty Organization members.
At the recent NATO summit in Madrid, allied leaders formally agreed to invite Finland and Sweden — both historically neutral — to join.
Part of joining NATO is agreeing to operate in the U.S. defense ecosystem, which translates into more money for America’s major defense contractors.
Regardless of the alliance gaining new members, the sector will benefit from congressional funding and bills passed to aid Ukraine against Russian attacks.
As Tony points outs, “even before conflict breaks out, the lead-up to the conflict is always to stock up on military hardware,” and you can bet that many companies in the sector are already backlogged.
Over the next few years, expect the manufacturing of more tanks, high-mobility multipurpose wheeled vehicles (known as Humvees), personnel carriers, artillery, guided anti-tank and anti-aircraft missiles, helicopters, drones and more.
In today’s special five-minute video segment, Tony highlights profit-making opportunities in a sector viewed as a major economic force in the U.S.
He says successful companies are bound to soar to meet increasing demand:
At its root, the stock market is based on earnings, earnings, earnings.
The real key thing about these military defense stocks is that their earnings are going to explode.
So, no matter what happens to the stock market, I think you have the opportunity to make some significant gains because when the orders come in, that translates into revenues and into profits.
I think that’s one of the recession-resistant areas because war doesn’t know about recession. War just knows about tension.
In this insightful video, Tony discusses:
- A stock that’s been heating up since February.
- The most liquid exchange-traded fund in the defense arena.
- What he calls “the military drone of the future.”
- What investors should expect for the rest of 2022.
And much more.
The information in this short segment couldn’t be timelier. Just go to the video box above to watch it now.
Happy investing!
Jessica Borg
Financial News Anchor
Weiss Ratings
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