A version of this article was published on January 13, 2020, when Mampilly’s ads first called this his “#1 Stock for 2020”, and though the ad is unchanged we’re seeing it a lot again now — most recently, the ads from Banyan Hill now say that this “$10 Stock Gets ‘All In’ Buy Alert on Coronavirus News.”
Which is a little tough to stomach, if only because Mampilly’s boosterism helped drive the stock to $11 or or so back in January when this ad started running, but the latest ads I’m seeing this week make no mention of the fact that the stock just hit 10-year lows during the crash last week, near $5.50 or so. In fact, despite the fact that the latest emails say this is an “all in” buy alert because of “coronavirus news”, the actual ad itself still carries a January 2020 date and is unchanged.
Here’s some of the updated stuff from that email from Jessica Cohn, quoting Mampilly:
“I believe what’s going on in the market is temporary… we’ve done this before in 2003, 2010, 2014 around Ebola, Sars … scares come and go …
“I believe money will come roaring back into the stock market and one of best investments you can make now is a $10 stock ‘immune’ to Coronavirus.”
Of course, if it was completely immune it would still be a $10 stock… but most stocks are not immune to fears of a major recession or the open-ended fears that we don’t really know how long the economy will have to be on “pause,” or how much worse it will get before it gets better. Yes, the market’s gyrating attempts to find the “bottom” will be temporary, eventually we’ll get a better understanding of where the world is going and markets will have a chance to settle and figure out what businesses are worth again… and no, we won’t be able to tell until months or years after when exactly the “bottom” was in.
So no stock is really immune to coronavirus, because stocks trade in a market that is on a wild emotional ride as it tries to figure out what the future will hold — but will the actual business be immune from coronavirus? That’s the question we should all ask ourselves — not when the stock will recover, since that’s pretty much unknowable, but whether a business will keep chugging along, recover from the economic “pause”, and get back to hopefully growing. Find businesses that will survive and thrive a downturn, whether it’s a few months or a year or longer, and then think about what a rational valuation for that stock might be based on the world we’ll be in after the coronavirus outbreak is no longer a major economic event… whenever that might be.
With that in mind, then, what is the stock? Since the ad has not changed I’ve left this next section of the article unchanged as well… and I’ll get back to you at the end with some more thoughts and updates about the actual company.
Paul Mampilly is out with a teaser pitch headlined “America 2.0” that I can only describe as “big patriotic optimism” — he thinks we’re at the point of beginning a new huge wave higher for the US economy as demographics, capital availability, and the “economic velocity” in the economy converge to generate big growth.
Which he thinks will bring the Dow Jones Industrial Average to 50,000 and eventually 100,000, and will help real estate double “in the months to come.”
He may end up being right, I have no idea [ed. note: so far, he wasn’t — unless “months to come” means “more than three months”], but what piqued my interest was his pitch about a special report that he’ll be providing to new subscribers:
“It reveals my No. 1-rated stock. It’s a little-known company that isn’t just positioned to profit from America 2.0 … it will be essential to building America 2.0.”
So that’s what we’re looking for today… what clues does he drop for us in his “special presentation?”
“… tell us more about this company, and why you think it will soar 1,000%.
“Paul: Sure. It’s a relatively small company based in South Carolina … valued at just $1 billion… But, it’s disrupting a $2.2 trillion industry… manufacturing.
“Manufacturing is the backbone of any economy, really. America is no different.
“Here’s the thing … since Henry Ford introduced the assembly line to the auto industry a hundred years ago … manufacturing has really remained the same. Sure, we’ve had robotics and computers make advancements … but there hasn’t been a disruption.”
I don’t know if I agree that the past 100 years have seen “no disruption” in manufacturing… but we’ll leave him to that opinion. What is this company doing?
“This company is disrupting the auto industry … making better cars, faster. Housing is becoming cheaper. Even the health care industry is seeing massive advancements.
“It already employs 2,000 hardworking Americans who are churning out almost $700 million in annual sales.
“And the stock is about to take off.
“Right now, it’s trading right around $10.Are you getting our free Daily Update
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“But I think it could soar to $50 … and then potentially even $100…. within the next few years…. As little as three years.”
And a few other hints:
“BlackRock just bought 514,000 shares of this company.
“Vident just added 404,000 shares.
“And Invesco Advisers just bought 8,000,000 shares.”
So who is this, dear friends? Thinkolator sez it must be 3D Systems (DDD), a stock that, along with its major competitor Stratasys (SSYS) went through a massive hype cycle about 6-7 years ago, when there was investor exuberance about 3D printing taking over the world (and when pretty much every newsletter publisher was teasing one 3D printing stock or another).
Things have been very, very quiet since that hype cycle fizzled out — 3D printing has continued to improve, of course, and has gotten dramatically cheaper (particularly at the low end, where you can now confidently give a clumsy 13-year-old a $100 3D printer that works better than the super-se