One of many wackiest years on document for the inventory market is lastly coming to a detailed. From a human perspective, nobody goes to be unhappy to kiss 2020, and hopefully quickly the coronavirus pandemic, goodbye. However for traders, it has been a gangbusters kind of yr for growth stocks.
As we head into 2021, I will be relying on the next mixture of progress and worth performs to energy my very own portfolio greater.
For greater than 4 years, gold stock SSR Mining (NASDAQ:SSRM) has been my largest holding. Previous to that, it was Canadian mining firm Claude Sources, which SSR acquired in 2016. Over the previous eight years, I’ve solely minimally pared down this place, which is up a little bit over 1,300% from my value foundation.
I am positively excited to see what 2021 has in retailer for my largest holding. The outlook for bodily gold has arguably never been more lustrous, with an all-time document $17.05 trillion in world investment-grade debt bearing a unfavorable yield. When coupled with ongoing quantitative easing measures within the U.S., and the prospect of fiscal stimulus, the U.S. greenback ought to stay beneath stress. It is price taking into consideration that the greenback and gold have an inverse relationship.
Past simply benefiting from a better value for gold, SSR Mining not too long ago completed its merger of equals with Turkey’s Alacer Gold. This yr ought to yield effectively over 700,000 gold equal ounces of manufacturing and north of $450 million in free money circulate.
SSR Mining can be introducing a $0.05 quarterly payout in 2021 and will additional enhance its capital return program, relying on its money circulate.
First Majestic Silver
Much like SSR Mining, silver stock First Majestic Silver (NYSE:AG) has been my No. 2 holding for years. Initially, I had owned shares of Mexican gold producer Primero Mining however got here into my shares of First Majestic by way of an acquisition of Primero in Could 2018.
Although silver does not have the identical actual tailwinds as gold, it is sometimes a really sturdy play inside the first 12 to 24 months of an financial restoration. I will be in search of silver demand to stay sturdy, particularly with the necessity for silver rising within the photo voltaic and auto industries. Provide and demand economics would recommend a lustrous future lies ahead for silver, because it does for gold.
As for First Majestic, 2021 must be the primary time in a very long time its backside line sees marked enchancment. Along with greater realized promoting costs, the prices related to the upkeep of mines can be lowered, whereas working effectivity must be on the rise at its three energetic mines (San Dimas, La Encantada, and Santa Elena). I am anticipating actual enchancment within the firm’s efforts to decrease all-in sustaining prices in 2021, which is able to, partly, assist First Majestic pay a nominal quarterly dividend.
Teva Pharmaceutical Industries
For brand-name and generic-drug producer Teva Pharmaceutical Industries (NYSE:TEVA), it was one other tough yr. Teva’s shares are comparatively flat in 2020 after the corporate confronted lawsuits alleging it mounted costs on generic medicine and was a key participant in fueling opioid dependancy within the U.S. Nevertheless, I imagine my third-largest holding and deep-discount worth inventory can have a better 2021.
Teva’s not-so-secret weapon continues to be its turnaround specialist CEO Kare Schultz. Since taking up in November 2017, Schultz has lowered the corporate’s annual working bills by about $3 billion and helped to scale back web debt from north of $34 billion to beneath $24 billion. By 2023, it is doable Teva’s web debt might dip beneath $15 billion, with a mix of asset gross sales and working money circulate used to pay down its debt.
It is also possible that Schultz will assist Teva navigate its present cloud of lawsuits. Avoiding money fines should not be troublesome for an organization with a monstrously giant portfolio of generic remedies. Providing its therapies at a reduction over the long term ought to enable Teva and U.S. regulators to come back to an settlement on excellent lawsuits before later.
Within the progress division, social media platform Pinterest (NYSE:PINS) climbed from brand-new buy to the No. 4 place in my portfolio in simply 10 months. Although it is unlikely we’ll see such sturdy positive aspects in 2021, I am assured that Pinterest can high a $100 billion valuation, if not rather more, earlier than the last decade is over.
The Pinterest progress story revolves round two catalysts. First, it is a numbers sport that the corporate is having no hassle successful. Previous to the coronavirus pandemic, Pinterest’s month-to-month energetic person depend was rising by 30% yearly between 2017 and 2019. It is picked up much more in 2020 as a big variety of individuals are staying at dwelling to safeguard their well being. However the vital facet of this person progress is that it is primarily coming from worldwide markets. Abroad common income per person might be doubled many occasions over this decade.
The opposite main catalyst for Pinterest is its burgeoning e-commerce presence. With its customers willingly sharing the issues, locations, and companies that curiosity them, Pinterest might be the platform that connects small companies to those motivated customers. It is investing closely in its platform to maintain customers engaged and is giving small companies each likelihood doable to succeed.
Teladoc Well being
Rounding out my high portfolio holdings is telemedicine large Teladoc Well being (NYSE:TDOC) within the quantity 5 slot. I initially bought Utilized Well being Indicators firm Livongo Well being in March however got here into my Teladoc shares following the buyout of Livongo.
Much like Pinterest, Teladoc was a no-brainer beneficiary of the coronavirus pandemic. Physicians wanting to maintain doubtlessly contaminated and at-risk individuals out of places of work have turned in larger numbers to digital visits with their sufferers. In every of the previous two quarters, Teladoc’s digital go to depend has greater than tripled from the prior-year interval. With telehealth extra handy for sufferers and medical doctors, and customarily cheaper for well being insurers, demand is simply going to extend going ahead.
The acquisition of Livongo Well being can be going to pay big-time dividends. I bought Livongo as a result of I used to be enthusiastic about its potential to enroll individuals with power well being situations. Regardless of holding lower than a 1% share of the U.S. diabetes market, Livongo had already turned worthwhile on a recurring foundation previous to its acquisition. Now, with Livongo’s ability to cross-sell solutions with Teladoc, I view the sky because the restrict.