I haven’t looked at Eifrig’s Income Intelligence in a long time, so it caught my eye when I saw the latest pitch for this Stansberry newsletter that is promising big gains in the very near future because a pick of theirs is likely to be added to the S&P 500.
So let’s take a look and see whether the Thinkolator can ID that stock, shall we? This offer, like so many others in recent years, is both high-priced and completely nonrefundable, and I’m sure a great many of you are unwilling or unable to cough up the $1,200 lifetime subscription fee (plus $99 annual “maintenance” fee) that is required. And, of course, wouldn’t commit that kind of money just out of curiosity about this “secret” stock.
This service from Eifrig has generally been a lower-risk dividend-stock service, though it also recommends other income investments, and it was the service that older subscribers to the cheaper 12% Letter were funneled into many years ago when that letter went defunct — it was from the 12% Letter that we first heard the pitches for “World Dominators” many years ago, and this pitch brings back that term… here’s a taste:
“Our Income Intelligence has pointed us to an elite World Dominating business that’s been quietly churning out billions of dollars in payouts to shareholders for the past 10 years.
“I call this company a sleeping giant because it’s big, safe, and currently pays a huge dividend.”
So that seems reassuring — “safe” is a trigger word for many investors now, in what feel like quite uncertain times, so I’m sure that stood out for some of you.
But it’s not just that this is a good and high-yielding company, apparently, it’s that this stock also has a hidden catalyst that has historically provided a nice pop for stocks. More from David Eifrig:
“… my team and I have been tracking a world-dominating stock that isn’t part of the S&P 500 Index… despite being a well-known, Fortune 500 company.
And based on our research, I can tell you with total confidence.
This stock will be added to the S&P 500 Index – and soon.based on our research, I can tell you with total confidence.
“This stock will be added to the S&P 500 Index – and soon.
“Which presents a HUGE opportunity for you – IF you can get in first.”
OK, so that’s the basic backdrop — it’s a big, safe, dividend paying company that’s not in the S&P 500 — but Dr. David Eifrig is convinced that it will soon be added to that index. What other clues do we get about which specific company it might be?
“… this company dominates its industry.
“It’s THE best of its class in the world.
“Right now it pays a whopping 6%+ annual dividend — about triple what the average S&P stock pays. And the CEO has the ear of all the major players on Wall Street… not to mention the President of the United States.”
OK, so that narrows it down a bit and might allow us to guess. Any other clues?
Thankfully, yes… here you go:
“This one company… along with the other 127 firms I’ve been tracking have one thing in common:
“They’re all MLPs – Master Limited Partnerships….
“… thanks to the recent change in U.S. tax law, more and more of these MLPs are restructuring.”
MLPs can’t be in the S&P 500, which is restricted to just corporations, so it’s that conversion that triggers the possible addition to the widely-followed index… and therefore causes a substantial increase in demand for the stock because of all the index funds and closet indexers that follow the S&P 500.
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The ad thinks it’s likely to jump right away, then continue to do well for a longer period of time — here’s how they put it:
“The moment their press release hits the newswire, its stock is likely to jump 10% to 20%. And as more money continues to funnel in, it could easily double or triple.
“But if you want to take full advantage of this opportunity, you must take a position before the announcement – which my team expects any day.”
We get a couple examples of other stocks this has happened to recently…
“… on February 6th, a former MLP called Ares suddenly popped and gained as much as 12% in a single day… then went on to gain another 15% in 4 weeks….
“The same thing happened for a second company, called KKR. They announced in early May… and now their stock is up 20%.”
And then we get one more little clue…
“… the company in question is MUCH bigger than KKR or Ares.”
So we feed that into the Mighty, Mighty Thinkolator for you, set the switch to “pulse” and crunch it up a few times — In the Fortune 500, MLP, 6% yield, and a near-certain answer comes tumbling out the other end: This must be Blackstone Group (BX).
Blackstone is a gigantic publicly traded partnership, an asset manager that’s nominally a private equity firm but really has the scale and influence of a major investment bank. It dominates large swathes of the investing world, particularly in real estate, and has been publi