Happy Ramadan…or as us Jews like to say…a great month to go to our favorite middle eastern restaurants.
To the markets…
I get excited about stupid things.
Today it is a big breakout confirmed in my ‘fashology‘ part of the portfolio.
Nike, LULU and Apple are all at all-time highs. Fashology is a big part of my 8 to 80 portfolio as all three stocks are in the current 14 stock portfolio.
I must insert the standard arguments against these three leaders:
1. There is no way that LULU, which sells overpriced gear with no visible logo, should be at all time highs.
2. Apple products are too expensive and there is nothing new.
3. Nike is too big and management is a mess!
On the macro side, we keep expecting this bull market to end because you know…length of expansion, valuations,Interest rates (see chart), Trump, Russia, China, trade deficit, health care costs, Penn Station, free trading, Bitcoin, 3rd world airports at LAX and JFK, global warming and of course ‘But Hillary’.
The problem/opportunity with all the fundamental negativity and the above specific opinions on Nike, Apple and LULU is these widespread negative opinions are public and already priced in to markets. Oh…and it is a bull market.
‘Fashology‘ companies will get hit, they always do, when they miss a season or product launch and that is always the risk with fashion and technology.
There are many other companies worthy of being in a ‘fashology’ index, but it’s my index and I want to select companies that are NOT too reliant on being brand rollups/conglomerates and those that are fashion leaders, not followers. Here is a list of companies I am considering right now:
Estee Lauder – $EL (I am pissed at all the women who read this blog including Ellen and Rachel for not connecting the dots for me 700 percent ago).
Canada Goose Holdings – $GOOS (too Canadian).
Adidas $ADDYY- (The shoes are obviously a smash hit, but I hate stripes).
Louis Vuitton – $LVMUY – (they seem very deserving and are continually on all-time high list).
America Eagle $AEO (too tween and teen, but great turnaround).
Ulta Beauty – $ULTA (not sure if the fashion AND tech are heavy enough, but one hell of a stock).
Deckers – $DECK (some great brands and a great stock, not sure about ‘fashion’).
Tesla – $TSLA (has it all but the financials are way too confusing – so will have to pay up later).
Luxottica – $LUX (too much of a roll up).
V.F. Corporation – $VFC (at $32 billion it is one hell of a rollup and Van’s is always great).
Hit me up with others that I am missing.
As Millennials work their way through the next 6 decades of working, living and spending.. a huge amount of money will be made riding the fashology trend.
Also published on Medium.