This week's Alpha Trader podcast features hosts Aaron Task and Stephen Alpher talking with Scott Martin, head of research at Kramer Capital Research.
What might have been an episode focusing on the ramifications of last week's elections instead was dominated by Monday morning's vaccine update - Pfizer and BioNTech announcing positive preliminary data for their Covid-19 candidate. That news sent the Dow higher by more than 5% and the S&P 500 more than 3.5% at the time of recording. The Nasdaq - which housed many of the pandemic-favorite, work-from-home names - was in the red.
Martin reminds that the Pfizer news might not be the golden bullet that ends the pandemic, and suggests the market may be over-reacting (indeed, by the close on Monday, the S&P had more than halved its early gain and the Nasdaq closed down 1.5%). He also notes that e-commerce isn't going away. A stock like Chewy (CHWY) - which fell nearly 12% on Monday - might be thought of as a pandemic stock, but it's really the future of pet supplies. Investors who missed the rip this year might be getting a buying opportunity.
Treasurys are trash, says Martin. Why lock in an (inflation-adjusted) loss, says Martin, when names like Pfizer (PFE), General Mills (GIS), Johnson & Johnson (JNJ) - practically as safe as the government - yield plenty more?
Getting to an election-related idea, the hosts and Martin discuss how to play the potential national de-criminalization of cannabis. Stay away from the growers, says Martin, as that's a commodity business. Instead, look for ways to invest in the consumer angle - gummies, edibles, soaps. Procter & Gamble (PG), Unilver (UL), General Mills may all get involved. As for pot names, Martin has been and continues to be a fan of Aphria (APHA) - medicinal, growing market share, into conventional pharma sales in Europe, and nearing profitability. Under any circumstances, Martin believes marijuana investments should be minor positions around one's major holdings.
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