Investor's Playbook

📖Today’s Agenda

• Stock Market : Tracking-Chip Maker Impinj Secures Beat-and-Raise Report, Propelling PI Stock Up

• Entrepreneurship : TOP 3 AI TOOLS OF THE WEEK

• Personal Finance : Navigating Market Volatility with High-Dividend Yield Stocks

📈Stock Market

Tracking-Chip Maker Impinj Secures Beat-and-Raise Report, Propelling PI Stock Up

Tracking-chip maker Impinj (PI) delivered a big beat-and-raise earnings report, which gave PI stock an adrenaline shot on Friday. Impinj was one of several semiconductor stocks moving on earnings news.

Seattle-based Impinj late Thursday reported better-than-expected fourth-quarter results and guided higher than views for the current period.

Impinj earned an adjusted 9 cents a share on sales of $70.7 million in the December quarter. Wall Street had expected earnings of 2 cents a share on sales of $68.3 million. However, on a year-over-year basis, its earnings dropped 78%, while sales slid 8%.

For the current quarter, Impinj predicted adjusted earnings of 11 cents a share on sales of $73.5 million. Analysts were modeling earnings of 2 cents a share on sales of $70.8 million. In the year-earlier period, it earned 30 cents a share on sales of $85.9 million.

"As we continue driving our bold vision to connect every item in our everyday world, we remain confident in our market position and energized by the opportunities ahead," Chief Executive Chris Diorio said in a news release.

PI Stock Gets Price-Target Hike

On Friday, PI stock rose 3.5% to close at 110.04.

Impinj makes tiny tracking chips that can connect items to the internet cloud for customers in retail, transportation, logistics and other industries. Its wireless chips track such things as retail store items, luggage, automobile parts and shipments.

Piper Sandler analyst Harsh Kumar reiterated his overweight, or buy, rating on PI stock and upped his price target to 130 from 105. He said Impinj is a "top small-cap pick."

"The company is seeing tremendous amounts of activity in retail which should continue to provide tailwinds through the second-half 2024 time frame," Kumar said in a client note.

Winners And Losers In Semiconductor Stocks

Semiconductor stocks have been a mixed bag this earnings season.

Chipmakers exposed to the boom in artificial intelligence, such as Arm Holdings (ARM) and Monolithic Power Systems (MPWR), jumped last week on AI-fueled quarterly results and guidance.

Meanwhile, chipmakers that provide components for smartphones also have done well. Audio-chip maker Cirrus Logic (CRUS), which gets 89% of its revenue from Apple (AAPL), popped after posting better-than-expected December-quarter results late Tuesday.

Semiconductor stocks falling on earnings reports last week were those mostly tied to weak industrial, communications infrastructure and consumer electronics markets. They included Alpha and Omega Semiconductor (AOSL), Diodes (DIOD) and Rambus (RMBS).

Meanwhile, automotive chip producers NXP Semiconductors (NXPI) and Onsemi (ON) guided lower for the current quarter, but analysts described their outlooks as "better than feared."

🎯Entrepreneurship

TOP 3 AI TOOLS OF THE WEEK

1. Yoodli

AUDIO TO TEXT / VIDEO TO TEXT

Enhance your communication skills with Yoodli, an AI-powered tool offering text, audio, and video analysis. Experience real-time feedback and personalized coaching to communicate effectively and confidently. Yoodli's user-friendly interface and judgment-free feedback make it invaluable for refining presentations, improving language skills, and analyzing digital content.

2.Crystal.ai

DATA TO TEXT / TEXT TO DATA

Crystal.ai offers transformative capabilities for businesses through AI-powered text analysis, creation, data analysis, and visualization. This cutting-edge platform employs data science, machine learning, and conversational AI to provide immediate, secure, and relevant insights that drive intelligent decisions and enhance business proficiency. With features like text analysis, creation, data analysis, and visualization, Crystal.ai simplifies complex data sets, empowers employees, and revolutionizes decision-making processes.

3. WIXSTUDIO

TEXT TO WEBSITE

WIXSTUDIO offers exceptional website creation and web design capabilities tailored for agencies. With streamlined web creation, innovative design tools, and versatile usage across sectors like web design, marketing, communication, and SEO, WIXSTUDIO simplifies complex processes for maximum efficiency. Ideal for tasks ranging from web design to SEO, WIXSTUDIO empowers users to stay ahead of technology trends, consistently produce top-notch results, and effortlessly scale their operations.

💸Personal Finance

Navigating Market Volatility with High-Dividend Yield Stocks

In the ever-shifting landscape of financial markets, the allure of high-dividend yield stocks shines bright, offering investors a beacon of stability amid the tumultuous seas of volatility. With Treasury yields on the rise, scaling heights unseen since the 2008 recession, the allure of fixed-income securities may tempt some away from the potentially choppy waters of individual stocks. However, the resilience and growth potential inherent in dividend-paying equities cannot be overlooked, especially in times of market turbulence.

As of January 29, 2024, the yield on the 10-year Treasury bond stood above 4.0%, peaking at 4.8% in October 2023 – its loftiest since June 2007. Despite these enticing yields, the average dividend yield of stocks in the S&P 500 index remains competitive. Indeed, for investors seeking a balance of income and potential growth, dividend-paying stocks present an appealing alternative.

One strategy that has garnered attention in navigating these volatile markets is AAII's High Relative Dividend Yield model. This approach, rooted in the analysis of dividend trends and financial metrics, has demonstrated a commendable annualized return of 8.4%, outpacing the S&P 500's 6.1% over the same period.

The significance of dividends extends beyond mere income generation; they serve as a bulwark against market downturns, cushioning losses and providing a degree of stability in turbulent times. However, not all dividends are created equal. Investors must exercise prudence, scrutinizing management's commitment to dividend payments and monitoring dividend growth trends.

High Relative Dividend Yields

At the heart of AAII's strategy lies the concept of high relative dividend yields, a metric that juxtaposes a stock's dividend yield against historical norms and industry benchmarks. This screening process seeks out companies with a history of rising dividends, above-average earnings growth, and manageable liabilities.

By identifying stocks with attractive dividend characteristics, investors gain insights into potential value opportunities. A seven-year dividend payment history devoid of reductions serves as a cornerstone criterion, signaling a commitment to shareholder returns even in adverse market conditions.

Applying the Screen

The screening process begins by excluding over-the-counter stocks and prioritizing companies with a consistent dividend payout history. Preference is given to those whose current dividend yield surpasses their seven-year average, indicating a potentially undervalued asset.

Further evaluation entails analyzing the payout ratio and financial strength, crucial factors in assessing dividend sustainability. A payout ratio between 0% and 85% for utilities and 0% and 50% for other sectors is deemed optimal, ensuring a balance between dividend distributions and retained earnings for future growth.

Conclusion

In summary, the High Relative Dividend Yield screen offers investors a roadmap for navigating market volatility with confidence. By identifying stocks with robust dividend credentials and growth potential, this strategy provides a path to stable income generation and potential capital appreciation. However, success in this endeavor requires diligent analysis and a nuanced understanding of dividend dynamics in fluctuating market conditions. Armed with these insights, investors can navigate the choppy waters of volatility with greater resilience and conviction.