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After a 90% Gain, We're Getting Back In...By
Tuesday, February 18, 2014
We love it...
Many so-called "experts" are now worrying about a property bubble here in the U.S.
Meanwhile, home prices are still cheap. And our True Wealth Systems computers tell us it's time to buy homebuilders.
We'd bet on our computers over the "experts" any day.
Let us explain...
Longtime readers know we've been fans of homebuilders for years... And yes, shares of the iShares U.S. Home Construction Fund (ITB) – which holds a basket of homebuilder stocks – are up BIG since we first recommended them.
Our True Wealth Systems readers pocketed 90% gains in homebuilders over a 19-month period from 2011 to 2013. And now, our computers say it's time to buy again.
Based on history, this is a signal you don't want to miss... We've tested it over nearly 50 years of data. And when our system was in "buy" mode, your money would have compounded at a 29% annual rate... WITHOUT leverage.
Conditions are in place for similar gains today. It comes down to supply and demand...
You see, housing starts (the number of new homes being built) in the U.S. are still at ultra-low levels. Homebuilders simply haven't done their job over the past few years. And now, we have a supply-demand imbalance in housing.
In short, the U.S. needs more houses... and homebuilders are going to be the ones to build them!
The thing is, most people have no idea just how high shares of homebuilders can go when that happens.
Hundreds-of-percent profits have been the norm after housing starts bottom:
On average, opportunities this good have led to nearly 300% gains in less than three years. You can see it in the chart below... When the housing starts (the blue line) bottom out, homebuilder stocks (the black line) soar:
 Housing starts today are still very low. We are a long way from "normal." Today, we are roughly where housing starts have typically bottomed in the past. The U.S. needs more homes... and homebuilders are going to build them. Of course, more building leads to more profits... and more gains for us as investors.
Right now, our True Wealth Systems computers say homebuilders are a "buy." Our readers walked away with 90% gains the last time that happened. And thanks to housing's supply-and-demand imbalance, it could happen again now.
Sure, shares of homebuilders have gone up over the past few years. But it seems the move isn't over yet... Check out shares of homebuilders today...
Good investing,
Further Reading:
Read more on why Steve thinks housing is one of the best places for your money here:
"If your retirement plan is to sit and wait and hope to earn higher interest someday, you have no retirement plan. Because that day might not come..."
"I'm predicting a major boom and then a bust... The question is, what investment could do well in both?"
Market NotesNEW HIGHS OF NOTE LAST WEEK
Hershey (HSY)... chocolate
Burger King Worldwide (BKW)... fast food
Green Mountain Coffee Roasters (GMCR)... coffee
Google (GOOG)... search engine
Qualcomm (QCOM)... semiconductors
Facebook (FB)... social media
Yelp (YELP)... social media
Priceline (PCLN)... discount travel
TripAdvisor (TRIP)... discount travel
Expedia (EXPE)... discount travel
Royal Caribbean Cruises (RCL)... cruise lines
Wynn Resorts (WYNN)... casinos
Walt Disney (DIS)... entertainment
Netflix (NFLX)... movie rentals
Comcast (CMCSA)... cable television
Tesla (TSLA)... electric cars
O'Reilly Automotive (ORLY)... auto parts
AutoZone (AZO)... auto parts
Goodyear Tire (GT)... tires
Becton-Dickinson (BDX)... medical devices
Walgreens (WAG)... drug stores
Express Scripts (ESRX)... prescriptions
AstraZeneca (AZN)... Big Pharma
Merck (MRK)... Big Pharma
Union Pacific (UNP)... railroad
Applied Materials (AMAT)... manufacturing
Baker Hughes (BHI)... oilfield services
C&J Energy Services (CJES)... oilfield services
NEW LOWS OF NOTE LAST WEEK
Not many... it's a bull market!
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