Brenda Buttner and was joined by: Gary B. Smith, RealMoney.com columnist; Pat Dorsey, director of stock research at Morningstar.com; Tobin Smith, founder and chairman of ChangeWave Research; Scott Bleier, president of HybridInvestors.com; and Charles Payne, CEO of Wall Street Strategies.
It was a sweet November for stocks. The Dow gained 6 percent and the Nasdaq really took off-up 11 percent. Stocks went up even as UN inspectors went into Iraq and Usama gets louder.
Last week Scott said to get out of tech because it's ready to tank. But he doesn’t think investors should get out of the market because the Dow has some catching up to do.
Gary B. warned that investors should not forget that any rally we have is still a bear market rally and that it is very unlikely the rally will clear the downtrend the Nasdaq has been in since 2000.
Charles advised short-term investors to buy on any dip at least through December to benefit from the market’s enthusiasm. He thinks the Nasdaq will lead the way.
Pat thinks investors should not get swept up in the market’s recent gains and keep your expectations low. He thinks the next bull market will gain 10-11 percent a year, not 30 percent a year.
Tobin said the business cycle has bottomed after being bad for three years. The good thing about this is that things can grow, and grow quickly. He believes things are starting to ramp up and the market will consolidate, which means higher highs and higher lows.
It's the best of times… and the worst of times for the Bulls & Bears because it was time to look at their best and worst calls.
First we reviewed their best picks.
In August, Tobin said AOL (AOL) was at a bottom and that it would be up 50 percent in a year. And three months since his prediction, the stock's about halfway there, up 28 percent. He recommended holding onto the stock and thinks it won’t need a year to gain 50 percent because advertising will pick up.
Last month Scott said Macrovision (MVSN) was ready for a comeback. And comeback it has! Making a huge gain of 46 percent since the middle of October. He advised to sell the stock due to the recent run it has had.
Once in a blue moon the planets align and Gary B. and Pat can both agree on a stock. This was the case when the two were bullish on payroll processor, Paychex (PAYX). It’s up 23 percent in that time. Pat owned Paychex then and still has it in his portfolio because he believes it is a great company. Gary B. was not as certain this time about the stock. He thinks it can make a run, but it must clear $30 first.
Lastly, it was Charles’ turn. At the end of May, he said the Nasdaq would get whacked from a downgrade deluge. Charles must know Tony Soprano, because when he says something's gonna get whacked, it does! Even with the great November the Nasdaq enjoyed, it's still lower by 11 percent from when he made his prediction. And it was down over 500 points at one time in October. He said it looks much better now, but it’s gone up too fast too soon. He thinks it will pull back, and when that happens, it’s time to get in.
Next we reviewed some of their not so stellar calls.
Gary B. and Pat blew it in a rare case when the fundamentals and the charts both got it wrong. At the end of July they said to stay away from Martha Stewart Living (MSO) and since that call the stock’s been a good thing for investors. A really good thing-up 59 percent! But the two are still in agreement and both do not like the stock. Gary B. said the stock is just too risky and he’d stay away from it. Pat added that the company is Martha Stewart, and if anything happens to her like the ImClone scandal, your investment is gone.
About a year ago we looked at some travel and leisure stocks that were taken down by the threat of terror attacks. Charles said Six Flags (PKS) was a good stock to buy and put away. But the stock has been on a bad roller coaster ride, falling 51 percent. He said the company has had some problems, however it will do much better going forward.
In late May Tobin said buy JetBlue Airways (JBLU) when it dropped below $40. It did drop below $40…unfortunately it kept falling! Tobin thinks JetBlue will take off again because its earnings will grow when the economy does. He owns the stock and believes it will go to $45 by the end of next year.
And we don't forget about long-term predictions! In November of 2001 Scott said Gateway (GTW) would double in a year. No such luck! Instead it's been cut in half, down 49 percent. Scott does not like the stock at all now. He said the company was unsuccessful at taking any business from its competitor Dell Computer (DELL) and recommended selling the stock if you own it.
Pat: Home Depot (HD) now cheap; up 20 percent by the spring
Gary B: Philip Morris (MO) up 25 percent next three months!
Charles: Best Buy (BBY) is a best buy! Up 30 percent in early '03
Scott: People shop! Electronics Boutique (ELBO) up 30 percent by May
Tobin: Zoran (ZRAN) digital picture perfect; up 20 percent by Jan. 1