Even though the market continues to perplex investors, our subscription based investment service EPIC Insights Premium continues to show strength. Since the portfolio's inception in late 2008 subscribers have realized a 27.8% return versus a gain of only 12.7% for the S&P 500.
Below I have the scoop on two of Sean's most recent successes which were both shorts. After reading up on the trades please feel free to email us and start a free one week trial run of the Premium service (three total reports)!
Whole Foods Market (WFMI)
Although most of the short sales in EPIC Insights are based on technical analysis, Sean also uses fundamental factors to influence his decisions. His recent short of Whole Foods Market (WFMI) is a prime example.
A purveyor of high-end groceries, WFMI appeared to be a company that would be hurt by an uneven economic recovery as consumers decided that frugality trumps luxury. In the November 1st newsletter, Sean argued that investors were overly optimistic about the company's future. Then trading at a P/E of 36, Sean recommended a short position in WFMI heading into earnings.
After the company posted strong numbers but a weak outlook the stock's shares fell over 15% in one day then proceeded to slip thereafter. This past Sunday Sean recommended covering this short position and walking away, netting subscribers over 20% in returns.
Goldman Sachs (GS)
After Goldman Sachs (GS) reported third-quarter earnings, the stock traded in what Sean called an erratic manner which ended up creating an island reversal (black circle). This bearish pattern coupled with overvalued fundamentals lead Sean advising subscribers short on October 26th near $180.
After increasing the position size around $175, GS continued to trend downwards. By the end of November the stock had reached Sean's initial price target of $165 (red box) leading Sean to recommending readers cover their short positions in this past Sunday's Newsletter. The result? A nice 8% return in just over one month.
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(Disclosure: Sean Hannon and Blain Reinkensmeyer are partners in the EPIC Insights Premium service.)