Market Direction and Stock Trends

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The adviser who recommended Google before anyone else is now touting this stock
By Mark Hulbert

* December 6, 2016

Louis Navellier recognized Google’s long-term potential within months of its IPO in 2004



CHAPEL HILL, N.C. (MarketWatch) — How would you like to know which adviser was one of the very first to recognize Google’s long-term potential, within months of its 2004 IPO?

Of course you would. And I bet you’d also like to know what he’s recommending now.

Let me introduce you to Louis Navellier, editor of the Blue-Chip Growth and Emerging Growth investment newsletters. Navellier also is founder and chairman of Navellier & Associates, a Reno, Nevada-based firm with more than $2 billion of assets under management.

Navellier was among the first to recognize Google’s GOOG, -0.33% long-term potential out of 200 or so investment newsletters that were monitored by the Hulbert Financial Digest in 2004 and 2005. To put his achievement in context, recall that Google, which is now called Alphabet, went public in August 2004 at an initial offering price of $42.50 (when adjusted for splits). Today it’s trading at almost $800 a share, representing a dividend-adjusted gain of more than 1,700%.


Google was trading for a split-adjusted price of around $150 when Navellier recommended the stock in October 2005. (Please see chart.) Among the reasons he cited for his recommendation were the blistering pace of its earnings growth (which “continue to stun observers”), investor excitement over the company’s secondary offering exactly one year after its IPO, and the upside boost the stock would get when, and if, it became a member of the benchmark S&P 500 Index (which, it turns out, happened less than six months later).

To be sure, there were two other advisers on the Hulbert Financial Digest’s monitored list who also recommended Google about the same time in 2005. But the basis of their timely recommendations was technical, keying off the stock’s impressive momentum, and had less to do with a fundamental analysis of the stock’s longer-term potential.

Navellier’s new pick

All of which suggests that we pay more than the usual attention to the technology stock that Navellier currently recommends the most strongly. That would be Nvidia NVDA, +0.17% the Santa Clara, Calif.-based maker of computer-graphics chips. Navellier notes that not only are the company’s earnings growing at a very fast pace, it also pays a dividend — only “one of seven dividend-paying companies in the semiconductor industry” to do so, he says.

Navellier acknowledges that Nvidia’s stock has suffered in recent weeks because of concern about the impact of Apple’s AAPL, +0.42% slowing sales, since Nvidia is one of that company’s major suppliers. He considers that reaction “a classic case of throwing out the baby with the bath water,” since the company has “stunning sales and earnings potential, and these Apple rumors don’t change that.” Nvidia’s stock has surged 168% this year.

In the most recent quarter, the company reported adjusted earnings of 94 cents a share, almost double the 56 cents analysts had expected. Sales jumped 54% to $2 billion.

http://www.marketwatch.com/story/the-adviser-who-recommended-google-before-anyone-else-is-now-touting-this-stock-2016-12-06

http://www.marketwatch.com/story/the-adviser-who-recommended-google-before-anyone-else-is-now-touting-this-stock-2016-12-06

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