More hoops and stock picks! The NCAA basketball tournament resumes tonight with four great games (Go Loyola!) and Real Money is also back today with four more tantalizing stock picks.
Before we get to our "Midwest Region" of Tim Collins, Skip Raschke, Jim Collins and Bret Jensen, let's review the rest of the brackets from our "Sweet 16" Stock Picks:
Can the Midwest picks match up with the rest? Let's check and see.
Jim Collins: Sony (SNE)
When I looked for an entrant in Real Money's Sweet 16 contest, my initial thoughts went to the underdogs -- reflexively, I checked the NYSE short interest page -- but for this contest I'm going with "chalk."
As a proud alumnus of Duke University, I am comfortable picking favorites in my brackets, and recommending Sony shares after a 58% jump in the past year feels a bit like choosing a top seed. With SNE shares trading at only 13-14x consensus earnings per share for fiscal year 2019 (March), though, I believe this company is still wildly undervalued.
The raft of M&A in the media space shows that content is king, and Sony has it in abundance through its Pictures and Music divisions. The content produced in those two divisions is a perfect fit for its "cable-killing" delivery product, the PlayStation; its potential as an over-the-top conduit is just being scratched.
Sony's earnings release in late April should be yet another positive catalyst for the stock, and hopefully April will be the un-cruelest month for favorites both in the markets and on the hardwood.
Bret Jensen: Achaogen, Inc. (AKAO)
Achaogen is a name I have profiled a couple of times so far in 2018. Let's recap why I think the stock will do well in the quarters ahead:
-- The company's first antibiotic, plazomicin, should be approved by the FDA at the end of June.
-- The stock was cut in half in the last few months of 2017 but has been bottoming here in 2018.
-- A beneficial owner has taken advantage of this drop in price to up his stake in the company from approximately 6% to over 14%.
-- Recent analyst price targets on the stock have been the low-to-high $20s range, with the stock currently trading around $13.
Tim Collins: Aquantia Corp. (AQ)
For my Sweet 16 pick, I want to go with the no-name underdog for the win in 2018: Aquantia.
Aquantia's focus is building hardware for high-speed Ethernet networking. Its hardware is at the top of the Ethernet game, boasting speeds of 10,000 megabytes per second, fast enough to download an entire movie in a little more than the blink of an eye.
Aquantia is providing Multi-Gig networking support for Action Alerts PLUS holding Nvidia's AI computing platforms starting in 2018. According to the companies, Nvidia DRIVE AI car computers use deep learning to process data from multiple cameras, radar, LIDAR and other sensors throughout the vehicle.
To deliver Level 4 and Level 5 driving -- which is categorized as a fully autonomous vehicle -- hundreds of trillions of deep-learning operations per second (TOPS) need to receive and process sensor data and immediately communicate critical decisions throughout the vehicle's systems. Aquantia's Ethernet products then communicate the data and decisions back and forth throughout the system at 10Gbps over automotive Ethernet cables to help provide a seamless autonomous experience.
Speed is everything. This a huge step to achieve a truly self-driving vehicle and puts AQ as my top trade idea for 2018 during March Madness.
Skip Raschke: Pfizer (PFE)
Game Plan: Buy Pfizer for the long term:
1) Pfizer has a solid back-court thanks to its P/E ratio of just 10 and a dividend yield of 3.7%.
2) A strong front-court that is composed of a balance sheet of $20 billion in cash, a market-penetrating drug portfolio and a quality line-up of drugs in their R&D pipeline.
3) Management looks forward to utilizing the major gains garnered from cuts in Pfizer's corporate tax rate down to 21%. Pfizer should also repatriate billions of dollars from its vast overseas business funds pool.
4) PFE offers excellent "D" (defense) when the market runs into trouble thanks to its very low P/E ratio and ample dividend yield.