Most money managers will tell you to buy and hold.
Not Jim Woods.
Woods looks for the winners—the big winners—and likes to trade, not buy, hold, and wait for dividend checks.
“This isn’t investing, this is trading,” Woods says. “I don’t want to marry her, I just want to date her. When we fall in love, we get too emotional and make bad decisions.”
Woods, a self-described radical for capitalism, has covered the economy and stocks for nearly two decades. His varied experience as a financial journalist, stockbroker and money manager provides him with unique insights into the complex world of investing.
As the Editor-at-Large at Money Threats and Next Month’s Winners, Woods typically picks five stocks that will be winners in the next four to six weeks.
At Tip Ranks, he’s regarded as the No. 2 expert of the more than 8,000 the site ranks.
Oh, and he’s also a former U.S. Army paratrooper.
“I like action,” he grins.
So, instead of looking for boring long-term gainers, Woods says to find the stocks that are poised for quick gains, then get rid of them when they do.
“We’re looking for stocks that are in the top 10 percent of all stocks out there,” he says. “Then, we want that price to be backed up by earnings.”
1.) A high earnings-per-share rank. Woods only picks those that are in the top 90 percent range for earnings. “When it comes to big money—big pension funds, big traders—they want that backbone,” he says.
2.) A strong relative price.
3.) Good press coverage. If the company is getting lots of good press, that’s a sign that something big is on the horizon.
Woods’ current picks?
Bank Of The Ozarks, Inc. (NASDAQ: OZRK)
This bank not only has an EPS ranking of 95 percent, but it also just wrapped up an acquisition and is posting strong earnings. Also, since the Federal Reserve is mulling a rate hike in December, that will improve the margins for all banks.
O’Reilly Automotive, Inc. (NASDAQ:ORLY)
Have you noticed there’s a ton of older cars that need parts on the road? So has O’Reilly. With that, the company has raised its earnings forecast. “That’s something I like to see,” says Woods. “That means they have plenty of upside left in the earnings department.”
Ryanair Holdings plc. (NASDAQ:RYAAY)
Strong earnings, strong ranking, strong growth and a profitable holiday travel season add up to one big winner.