Why SM Energy (SM) is a Growth Stock to Watch

Most investors know that growth stocks can be some of the most exciting stocks on the market. The reason is that they tend to catch the attention of other investors and thus produce big gains. Everything that goes up must come down however and, when the growth is over and the downside begins, finding companies that still have strong growth prospects is the most important factor for an investor looking for a good stock that will provide top-notch long-term gains.

SM Energy Company (SM) is one of those companies, and it appears to be very well-positioned for excellent earnings growth in both the near and outlying future. With an EPS growth just shy of 260% last year, this Oil-US Exploration and Production company is looking good for 2014 as well. As a matter of fact, current growth estimates for 2014 are calling for a 55.6% earnings per share growth which is very strong.

At 17.77%, the long-term growth rate that SM Energy Company now has is suggestive of excellent long-haul prospects.  Add that to the 1.67% rise in estimates over the past month for the  current fiscal year and you have an excellent stock on your hands with a very high potential for outperforming the industry.

If a fast-growing stock with a lot more opportunities in the future is the kind of stock that you are searching for, SM Energy Company should definitely be a stock that you consider purchasing soon. Right now it not only has  and earnings growth prospect in the double digits but most analysts predict that it will do quite well in the future.

Keep in mind that while SM Energy is no longer a growth stock, analysts believe that it will do quite well in the long run, making it a stock that should fit well into any investor’s portfolio.

Earlier in the year one of the first major signs that Samsung might significantly underperform near-term expectations came when it warned investors about a huge 24% decline in their operating profits. Citing challenges with currency, cannibalization of its smaller tablets by phablets and headwinds against the sales of their other smartphones, news about the company since then has continued to worsen.

One of those bits of news is the fact that the iPhone 5S, which Apple released nearly 8 months ago, is still outselling their flagship smartphone, the Galaxy S5, even though it was released just recently.

In fact, the iPhone 5S was still the best-selling smart phone in the world as of May, going directly against what was predicted by most analysts. The Galaxy S5 might have come in second place but, in even worse news for Samsung, it was a very distant second.

Not only that but the total amount of smart phones overall that Samsung is selling declined in the second quarter of 2014 as opposed to sales from last year’s second quarter.

It’s widely believed that Apple is one of the main reasons for the poor results that Samsung is now having, and that probably won’t change with Apple’s third fiscal quarter earnings report that’s coming out soon. Analysts have predicted it will show a 12% increase from a year ago, which would be a third-quarter record.

With all signs pointing to the release of two new, bigger iPhones in the very near future, it’s likely that Samsung is going to feel the pinch from Apple in the near future as well. Right now Samsung is benefiting from the fact that Apple is absent in the large screen smart phone category, but the launch of the iPhone 6, which reportedly will come in both 4.7 inch and 5.5 inch screen sizes, will quickly put an end to that.

This is likely to appeal to both fans of the ubiquitous iPhone and fans of the new, larger size ‘phablet’ phones. For example, a recent survey by Counterpoint showed that nearly 40% of all smart phones sold globally in May were the bigger screened phablets, a huge increase in the last year. It’s predicted that the 5.5 inch iPhone 6, if rumors are true of course, will be an instant hit among fans of these bigger smart phones.

Apple investors are thus in a very fortunate position, since consumers have already proven that smart phones with larger displays are in demand. After taking advantage of Apple’s absence and riding the recent success of phablets, Samsung will find itself in a much tougher position going forward, especially as it appears that sales of their smart phones have peaked.

Why you should invest in Stocks

This quick little blog is going to explain why, if you want to invest, investing in stocks is one of the best choices you can make.

The fact is that, over the past 100 years or so, any long-term savings that you invested would have done much better in the stock market than anywhere else you could have invested, including real estate, gold, bonds and definitely collectibles.

Now, before you begin, and before you enter any ticker symbols, track the Dow or look deeply into a specific company’s cash flow, you should definitely set some expectations for yourself.

One of the very best rules of thumb when it comes to investing in stocks is to invest money that you’re not going to need for at least 5 years and, if possible, much longer. Any money you won’t need for the next 5 years should definitely be invested into the stock market for your best chance of a great return.

Any money that you’re going to need in the next one, two, three, four or less than five years, money for your son’s college tuition, a down payment on your first home or to open your first business, should be put into something like a money market account, a CD or simply a savings account. In other words, a short-term savings vehicle where you can access your cash quickly and with few, if any, fees.

And by the way, if you have high interest credit card debt of any kind, you should definitely pay this debt completely down before you start investing in stocks, no question.

Now, here’s the best, strongest, no questions asked reason why you need to put your long-term money into stocks; history.

Historically speaking, there was no better place where you could have put your money in the last hundred years, and gotten a better rate of return, then in the stock market. Since 1926 the historical average annual S&P return has exceeded 10%. Even though the S&P 500 only had a 6% annual return from 1997 through 2007, due to the bear market of 2000 through 2002, you simply can’t argue with historically excellent returns like these.

If you look at history, and you look at everything that’s happened in the last hundred years including depressions, bull markets, elections, recessions and so forth, the stock market has undoubtedly been the best place to put your money for excellent long term returns

And that, simply put, is why you should invest in stocks.

Risk Free Lesson on Investing

If you’ve just started investing the truth is that you’re probably scared to death about putting your hard-earned money at risk. After all, investing is risky and, as a newbie, you have anxiety that you won’t do it “right” and lose some of your hard-earned money.

The truth is, a little bit of fear is absolutely normal. That being said, today we’re going to give you some great advice about how to learn some investing strategies, and give them a practice run, before you actually begin to invest your hard earned money “for real”. Enjoy.

Create a mock portfolio online

Okay, let’s say that you gotten comfortable with the basic mechanics of investing, like researching the company whose stock you want to purchase and deciding how and when to place your orders for buying and selling. If that’s where you are, you can create a mock portfolio online and see how any decisions you make play out, even if it’s just over a short period of time. One caveat however is that you can’t draw a lot of “big conclusions” based on how your stock choices did, and how the market behaved, over a few weeks or months.

Setting up an online portfolio to use as your mock portfolio can be done on sites like AOL or Yahoo finance for free. You can enter mock details as to when you purchased shares, and at what price you purchased them. Then you can track the performance of the shares and see how your holdings behave over a few weeks or months. This is a great technique to learn more about yourself and your own investing habits and skills.

For investors who are a little bit more experienced

Even if you are what most would consider a seasoned investor, a mock portfolio can assist you in a number of ways. For example, if you’ve just read about an investment strategy that you think looks good, and you’ve seen a few reports on back testing showing that it worked well for others, you can do a trial run using your mock portfolio to see how it works when you do it.

You can use this strategy to see what happens with any stocks that you invest in and, if the strategy seems to be working, start investing with real money. If it’s not, at least not for you, then you save yourself some time, headaches and money that you didn’t risk.

Frankly, the thought of all of this work creating mock portfolios might be enough to give you a headache and, if it has, you can actually skip this altogether and simply invest in a few low-cost stock mutual funds instead. It’s relatively easy, low risk and over time you can add to it too. For a beginner investor there’s certainly no shame in doing it this way, and it’s low risk to boot.


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