Best Teaser Stocks of the Year

By Travis Johnson, Stock Gumshoe, December 26, 2018

We have a couple traditions here at Stock Gumshoe… we call out one of the worst teaser stock ideas around Thanksgiving and identify the “Turkey of the Year,” and then, as the year comes to a close and holiday merriment washes all around us, we call attention to the best teaser stocks of the year.

The list is not an impressive one, I’m afraid… things didn’t look all that bad when we were compiling our Turkey of the Year results a little over a month ago, but everything has gotten a little dicier in the market in recent months (we cut off the “Turkey” picks in September or October)… so now we sit with a tracking spreadsheet that shows 31 stocks teased this year that have beaten the market since they were touted (and about 16 of them had absolute positive returns, versus just “better than the market” returns)… and 92 teased that have trailed the market.

That doesn’t change the bottom of the spreadsheet much — we’re still looking at the worst performers being mostly small and flighty stocks like Apricus Biosciences (APRI), Terra Tech (TRTC), Leading Edge Materials (LEMIF), and, of course, the Turkey winner Indivior (INVVY) is still down near the bottom.

But we’re not focusing on that — it’s the end of the year, and the markets are lousy enough that you can find pessimism wherever you look, so now we’re doing our Christmas season tradition: Identifying the best teaser picks of the year.

Mathematically, that’s easy… here’s the top ten from the spreadsheet (as of last Friday):

Date Company Ticker Newsletter Editor Publisher Buy Price Current Price Percent Change Stock vs. S&P
1/4/2018 The Trade Desk TTD Motley Fool Stock Advisor Dave Gardner, Tom Gardner Motley Fool $48.35 $106.55 120.37% 132.34%
3/12/2018 The Trade Desk TTD Motley Fool Stock Advisor Dave Gardner, Tom Gardner Motley Fool $57.95 $106.55 83.87% 96.88%
1/11/2018 Innovative Industrial Properties IIPR Crisis Investing Nick Giambruno Casey Research / Stansberry $30.25 $44.98 48.69% 62.09%
6/27/2018 Eli Lilly LLY Dividend.com Premium $85.49 $109.42 27.99% 39.14%
6/7/2018 Hershey HSY Stansberry’s Investment Advisory Porter Stansberry Stansberry Research $91.77 $105.91 15.41% 28.88%
6/14/2018 Verizon VZ Technology & Opportunity Jason Stutman Angel Publishing $48.06 $54.92 14.27% 27.42%
9/11/2018 American Tower AMT Near Future Report, The Jeff Brown Bonner & Partners $147.31 $158.00 7.26% 24.00%
10/11/2018 Aerojet Rocketdyne AJRD Crisis and Opportunity Christian DeHaemer Angel Publishing $30.49 $33.75 10.69% 23.47%
10/3/2018 Tencent TCEHY Motley Fool Rule Breakers Dave Gardner Motley Fool $38.62 $39.54 2.38% 19.22%
9/11/2018 Nokia NOK Near Future Report, The Jeff Brown Bonner & Partners $5.36 $5.49 2.43% 19.17%


And I’m a little bit reassured that I hold six of the ten in my Real Money Portfolio (OK, fine, a couple are duplicates), but what lessons can we learn from these stocks?

Well, first I should be fair and include the stocks we would have mostly bypassed when we looked at these numbers a year ago — the ones that were picked toward the end of 2017. Because of timing (the market surged in the first part of this year before coming back down), the best picks from late last year did a lot better than the best picks in mid-2018… here are the stocks that could have been included if we had gone back 14 months instead of 12…

Date Company Ticker Newsletter Editor Publisher Buy Price Current Price Percent Change Stock vs. S&P
10/2/17 Intelsat I Technology Profits Confidential Ray Blanco Agora Financial $5.37 $19.42 261.64% 266.45%
10/31/17 Innovative Industrial Properties IIPR Crisis Investing Nick Giambruno Casey Research / Stansberry $19.54 $44.98 130.19% 136.72%
11/8/17 Nearmap NEAPF Australian Small-Cap Investigator Sam Volkering Port Phillip Publishing $0.54 $1.23 127.78% 134.54%
10/31/17 Canopy Growth CGC Crisis Investing Nick Giambruno Casey Research / Stansberry $12.79 $26.22 105.00% 111.52%
11/30/17 BioTelemetry BEAT Forecasts & Strategies Mark Skousen Eagle Financial Publications $27.65 $53.48 93.42% 102.40%
10/23/17 The Trade Desk TTD Motley Fool Stock Advisor Dave Gardner, Tom Gardner Motley Fool $63.31 $106.55 68.30% 74.48%
12/7/17 Advanced Micro Device AMD Exponential Stock Investor Ryan Dinse Port Phillip Publishing $9.94 $16.93 70.32% 79.67%
12/5/17 AMD AMD Near Future Report, The Jeff Brown Bonner & Partners $10.00 $16.93 69.30% 77.86%
12/15/17 Five Below FIVE Cabot Growth Investor Mike Cintolo Cabot $68.29 $90.38 32.35% 42.60%
11/16/17 Elekta EKTAF Stansberry Venture Dave Lashmet Stansberry Research $8.55 $11.56 35.20% 41.86%


And to be fair, I don’t even think Ray Blanco actually picked Intelsat in his “Halo-Fi” ads — though that was one of the possible guesses.

There are clearly some things that pop out — first, that several of these teaser pitches were repeated many times over the past year (or even longer)… the Motley Fool has been gaga for The Trade Desk in lots of different ad pitches, Ray Blanco has blanketed the world with his “Satellite Internet” pitch for more than a year with few updates).

Second, a lot of marijuana stocks are still up nicely from last winter, even though they’re well off their highs.

Third, that some “safe” stocks are starting to stand out after the recent carnage in growth stocks — Eli Lilly, Nokia and Hershey would not have been on this list a few months ago.

And finally, which you’ll see some more info about in a moment, it’s interesting that several of these stock picks were part of a group of picks all teased at the same time (like Moog and Maxar along with Aerojet Rocketdyne, for example), and in most cases those pitches included some stinkers along with the strong performer.

But I’ll let you draw your own conclusions on why these might be the “best” — I’ll share below my “Quick Take” from each of those teaser solution articles, with the wording being what I posted at the time (hopefully they’re not too embarrassing, I’ll add a little extra note where needed to explain), and give  you the link to the article if you want to follow up or see what other readers were saying at the time.

MOTLEY FOOL’S “‘TOTAL CONVICTION’ STOCK LOOKS TO US LIKE FACEBOOK BEFORE ITS IPO” (The Trade Desk, 1/4/18)

This isn’t a 100% certain match, but it seems the Motley Fool folks are doubling down again on TTD as a growth idea in digital advertising. I do like the stock, and have been contemplating adding to my small position but haven’t done so yet — I may grow this holding a little before they report earnings in mid-February, I suspect that they will beat the low expectations they set last quarter and I do like the strategy and the CEO… his recent (free) interview with the Fool is worth reading.

FOOL’S “TICKING TIME BOMB FOR CABLE TV” PITCH (The Trade Desk, 3/12/18)

I like The Trade Desk and have bought a small position over the past six months or so… I think they have a good avenue for growth by collaborating with both advertisers and ad agencies to enable more efficient and effective programmatic ad buying (meaning, automated digital ad buying), and I like that they have a strong founder and insiders who hold a lot of shares and a clear strategy. No sure thing, not for a minnow in this business dominated by whales, so my position is small because of the risk… but I think you can rationally buy below $65 given the forecasts for 2019 earnings (that’s a forward PE of about 30). Likely to be volatile, current stop loss trigger is in the high $30s.

CASEY’S “5 TINY ‘POT’ STOCKS SET TO SOAR IN 2018 POT BOOM” TEASED IN “BECOME A MARIJUANA MILLIONAIRE IN 2018” (Innovative Industrial Properties was one of the five, 1/11/18)

It’s really hard to buy stocks that have surged this dramatically, as most pot stocks are climbing on huge optimism about the legal recreational markets of California and Canada that will emerge this year. I did buy shares of IIPR, which have been on my watchlist for a while, they’re a REIT doing sale/leaseback deals with medical marijuana facilities and have a chance at pretty dramatic dividend growth if their future deals are as good as their first couple purchases. Canopy Growth is the best company I’ve ever watched in the marijuana space, but trades at a ludicrous valuation and I’ve never owned it, GrowGeneration has some appeal as a retailer trying to consolidate the hydroponics supply business, but jumped 50% today thanks to Casey and that seems silly. Kush Bottles is a packaging supplier, I don’t understand why they would have any competitive advantage but they are at least profitable… and Cannabis Wheaton has a great-sounding business model as a streaming “financier” in the pot industry akin to the mining royalty and streaming companies, but the financials are nowhere near in place to justify the valuation — I think you’d have to have an incredibly optimistic view of marijuana pricing and CBW’s ability to access cheap capital to take that one seriously.

“RISING HEALTHCARE DEMAND ENABLES 100+ YEAR DIVIDEND-PAYING PHARMA GIANT TO ENTER BEST DIVIDEND STOCKS LIST” (Eli Lilly, 6/27/18)

They’ve added this to their “Best Dividend Stocks List”, and it’s probably a reasonable choice. Going by the financials and the forecasts I’d find Bristol-Myers Squibb (BMY) slightly more attractive at current valuations, with a higher dividend and growth, but LLY is likely to be more stable and has done better than their average pharma peers in recent years. All drug stocks have company-specific and drug-specific risks, which you can bypass with an indexed ETF like iShares US Pharmaceuticals (IHE), though you sacrifice some of the performance (and fun) that the best individual stocks can provide, and still face the overriding risk factor of U.S. drug pricing regulation that looms over all pharmaceutical stocks. I don’t currently own any big drug stocks and I’d generally find service providers, device makers and royalty investments in the space more appealing (I currently own LGND and some healthcare REITs in the Real Money Portfolio), but LLY and most of its competitors are priced fairly as long as price controls don’t blow up the industry — and given the might of the PHARMA lobbyists, that may be a safer bet than fearful investors expect.

(I was wrong on that, by the way, LLY has done dramatically better than BMY and the broader sector ETF, both of which are down ~10%)

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