Oxymoronically pounding the table here for CALMThere are a lot of reasons I like the trade I entered into yesterday at the close here. I'll start with some reasons I'd like CALM regardless of my trading style.
I think everyone can agree we are in an overvalued market right now. That inherently creates risk with any stock you buy right now. Not saying we are gonna go down, but the more overvalued the market gets, the greater the risk that creates. CALM has several things going for it in that regard.
1--it has a TTM P/E of 4.12. Not 41.2 - FOUR!!! This is good even for a value stock.
2--their current yield is 8.11%. Give your head a second to wrap itself around that one - this stock has a yield that is twice its P/E. To put that in perspective, NVDA has a P/E of 50. If its yield were 2x its P/E, it would be paying a 100% dividend. This is not really an anomaly, either. It has always been a high dividend stock.
3--in the event inflation picks up again, foods are an area where costs can be passed through to customers better than in other areas. Eggs will still be eaten, even if they cost more. We've already proven that once. People will complain, but they still buy them.
Now for the part that really intrigued me here. 18-2 on trade signals in 2025 with an average gain of 3.5% and an average holding period of 9 days (including that 109 day marathon). That includes the two losing trades recently, and works out to a gain of .39% per day held. Note: trade returns on the chart are basis points (.01% per bp)
Those are beyond tech stock level daily returns on a stock that has been flat overall on the year, that sells something Americans bought 108 BILLION of last year (while griping about prices) that has a low P/E and if the trade goes sideways, pays me 2% a quarter to hold onto. That's .03% per day just to hold it, not including any gain on the trade itself. The average historical daily gain of SPY is around .04%, for comparison.
Why is this stock not being talked about? I don't know and I don't care, but I went long at yesterday's close at 103.01 and it's trading just below that as I put the finishing touches on this post.
As always - this is intended as "edutainment" and my perspective on what I am or would be doing, not a recommendation for you to buy or sell. Act accordingly and invest at your own risk. DYOR and only make investments that make good financial sense for you in your current situation.
