Question:
We are looking at either First Solar, Inc. or Canadian Solar. We think solar power will be picking up in the future. What do you think of these two stocks?
Answer:
Solar power is a growth market for clean energy. First Solar, Inc. (NASDAQ: FSLR) makes solar panels for power companies. The company meets Henssler’s strict criteria for investment. It is growing at 11% a year, but it trades at 27 times earnings, which is expensive. The company has 3% debt. Canadian Solar, (NASDAQ: CSIQ) is considerably smaller, and nowhere near the company of First Solar. If you are interested in this industry, First Solar is worthy of consideration.
Question:
I like the innovation Samsung has had with their phones recently, I think they have really made a push to compete with Apple over the last few years. I am thinking of buying some of the stock, I think it looks pretty good, but wanted to see what you thought first?
Answer:
Samsung is a great company with a wide range of product offerings. It is in the top 15 in market capitalization worldwide. However, Samsung does not trade as an American Depositary Receipt (ADR) on U.S. exchanges. Your best option is to gain exposure through an exchange-traded fund. iShares MSCI South Korea Capped ETF (NYSEARCA: EWY) seeks investment results that correspond to the MSCI Korea 25/50 Index. Samsung currently makes up 20% of the ETF.
If you wanted a direct investment in Samsung, you would have to find a broker that trades on either the London Exchange or the Korean exchange. Shares may be more expensive and the trade volume may not be as high as what you traditionally see on American exchanges. When you buy shares on a foreign exchange, your dollars are first converted to a foreign currency then you buy the stock. However, in addition to general market risk, you have added exchange rate risk. You could easily lose your gain on your investment because of the currency exchange.
Question:
What is a DRIP?
Answer:
DRIPs are dividend reinvestment plans offered by companies whose stock you invest in. The reinvestment plan automatically invests your dividend payments into new shares of the stock, allowing you to increase your holdings with little effort. Often, companies will waive brokerage fees or offer additional shares at a discount. Investors may also receive fractional shares, which are not available on stock exchanges. Tax reporting for dividend reinvestment plans can be complicated, but they are still a good way for an investor to grow their holdings. However, investors need to be aware that while a DRIP makes investing easy, they only allow you to buy shares of one company. You still need to diversify your portfolio.
Question:
I really like GoPro. Their first earnings report was not that great, but I think they will do better in the long run. So my question is how do I gauge the risk I would take in investing in the stock for the long haul?
Answer:
GoPro, Inc. (NASDAQ: GPRO) develops hardware and software solutions for capturing, managing, sharing and enjoying video content. The company trades at 400 times earnings and 200 times sales. We feel GoPro is a risky endeavor because the barriers to entry for the industry are low. There is not any compelling technology that gives the company an advantage over other camera manufacturers. We recommend avoiding this stock right now.
If you have questions regarding your stock holdings the experts at Henssler Financial will be glad to help:
- Experts Request Form
- Email: experts@henssler.com
- Phone: 770-429-9166.
Disclosures
This article is meant to provide valuable background information on particular investments, NOT a recommendation to buy. The investments referenced within this article may currently be traded by Henssler Financial. All material presented is compiled from sources believed to be reliable and current, but accuracy cannot be guaranteed. The contents are intended for general information purposes only. Information provided should not be the sole basis in making any decisions and is not intended to replace the advice of a qualified professional, such as a tax consultant, insurance adviser or attorney. Although this material is designed to provide accurate and authoritative information with respect to the subject matter, it may not apply in all situations. Readers are urged to consult with their adviser concerning specific situations and questions. This is not to be construed as an offer to buy or sell any financial instruments. It is not our intention to state, indicate or imply in any manner that current or past results are indicative of future profitability or expectations. As with all investments, there are associated inherent risks. Please obtain and review all financial material carefully before investing. Henssler is not licensed to offer or sell insurance products, and this overview is not to be construed as an offer to purchase any insurance products.
