To the Editor:
I like to invest in best-of-breed companies at reasonable-to-great valuations in a diverse set of industries and hold on to them for as long as possible (“Stocks Are Having a Terrible January. That’s Creating Buying Opportunities,” Cover Story, Jan. 28). In March 2020, I loaded up on the cyclicals because they were trading at once-in-a-decade valuations. Along those lines, I have been capitalizing on the Nasdaq correction to pick up the best-of-breed tech companies that are profitable, growing fast, with a wide economic moat, and net cash balance sheet. In my view, this is not the time to start buying hand over fist, but it would be prudent to add some high-quality tech names at these levels, especially if you don’t have much exposure to the sector.
Chris Bentsen, on Barrons.com
To the Editor:
I saw this drop coming a couple months ago and went to 30% cash. I’ve been nibbling at some tech and growth. This had to happen. The question now is whether the decline will continue. For sure, this is going to be an incredibly volatile year. We’re getting used to 1,000-point ups and downs in one day.
Ernest Montague, on Barrons.com
Vertex Pharma
To the Editor:
I agree with William Priest’s bull call on Vertex Pharmaceuticals (“20 Bargain Stocks to Buy Now,” 2022 Barron’s Roundtable, Week 3, Jan. 28). However, watch for a key coming catalyst from competitor AbbVie, which has a big data release for its triplet [medication] that would compete with Vertex’s Trikafta cystic fibrosis franchise. The bar for AbbVie is high, and the Street is generally of the opinion that it does not have a knockout product here. My sense is that Vertex shares will get hit harder if the AbbVie data are better than feared, and get a small pop if the AbbVie data are average, as the Street expects. Beyond that, Vertex is doing a much improved job of showing the Street some pipeline assets that analysts can begin to get excited about and build into their financial models.
Adam Schneiberg, on Barrons.com
To the Editor:
The annual Roundtable is the single most valuable source of investment ideas and rationales that I find. Scott Black, moreover, is the value investor’s friend. Thank you, Barron’s.
Nils Wessell, on Barrons.com
Meme Mania
To the Editor:
It was a fun ride on the meme-stock coattails (“A Year After It Began, Meme-Stock Mania Is on Life Support,” Jan. 28). It’s always nice to see new trends and how the market treats them. There is money to be made with disruption. I saw AMC Entertainment Holdings as a stock that was artificially depressed by the pandemic, and got in at $6. I was going to hold the shares until reopening in about 12 to 18 months. Boy, was I surprised when AMC spiked later that month to $72. I was out soon after.
Robert Blatter, on Barrons.com
To the Editor:
I seriously believe that the meme-stock frenzy and options plays started the downhill trend in the markets and destabilization, along with inflation mounting with too low interest rates and all of the free money that went into the markets.
Kathy Rubin, on Barrons.com
To the Editor:
Think of it this way: A group of people believe that GameStop is a good company. So they buy the stock, and they hold the stock. And then they buy some more. Since this group numbers in the hundreds of thousands, how long before the whole free float is purchased?
John Flahertyv, on Barrons.com
In Powell’s Defense
To the Editor:
I am no fan of Federal Reserve Chairman Jerome Powell or his board (“The Next Recession Is Coming. Here’s How to Time It,” Up & Down Wall Street, Jan. 28). Nonetheless, Powell may be playing a shrewd game of jawboning the economy down. He is talking tough, and the stock market is draining the wealth effect from the economy. Jawboning is a powerful tool. In the end, he may need to raise interest rates a little, say to 2%. Powell is a lawyer, and he may be skilled at manipulation.
Donald Barney, on Barrons.com
Moderna’s Edge
To the Editor:
Moderna is evolving into one of the most productive and important biotech companies in recent history (“Moderna Faces Challenges Beyond the Covid Vaccine. Its Stock Is Still a Buy,” Jan. 28). Messenger RNA technology will fast-forward from here. And yes, there is clearly competition for Moderna out there, regarding the use of mRNA sequencing and genomes to create vaccines and drug molecules, but there is plenty of room for many companies to profit from this wonderful evolution. But Moderna will clearly remain one of the stellar leaders.
Gary Frey, on Barrons.com
Chemicals Advantage
To the Editor:
Interesting thesis on U.S. chemical industry and its competitive advantages (“As Inflation Bites, the Old Economy Has Its Revenge,” Other Voices, Jan. 28). It wouldn’t take much growth in industrial production to create a sustained period of 15% earnings-per-share growth for these companies. Value stocks look likely to outperform.
Michael Meaney, on Barrons.com
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