Tech Money Mastery: How 1 Analyst Earned 46% In Just 4 Days

IMMEDIATE ACCESS: You can find the transcript of the beginning of Episode 1 of the Monthly Milestone podcast below.

Nikia Wade: Hello all, and welcome to the very first episode of the Monthly Milestone podcast. I am your host Nikia Wade. And, with me, I have our very own Gianni Di Poce. He has over a decade of market analysis and trading experience.

He demonstrates a history of applying technical, cyclical and economic analysis to provide investors and traders an additional edge in the market. So I definitely wanted to give you a shoutout, Gianni. Thank you so much for making time for the first episode. 

Gianni Di Poce: I’m really glad to be here, Nikia. Thank you for having me. 

Nikia Wade: For our listeners, here's what you can expect from Monthly Milestone. You'll get boots-on-the-ground insight from Benzinga Research's analysts. They'll reveal what's hot in the market, what you need to keep your finger on the pulse, and (even more important) where the opportunities are. You need to know where the money is hiding. If you want to know, you want to talk to the best in the business. So that's why we have Gianni here today.

Why Some People Love Tech But Don't Score Big Profits

Nikia Wade: Gianni, tech is all the rage. From Bitcoin to non-fungible tokens (NFTs) and artificial intelligence (AI), tech is by far one of the most fascinating industries right now. Could it be that tech evolves at such a quick pace? Why do you think tech is so hot right now for investors? 

Gianni Di Poce: Well, that’s a really good question. You know, we had a pretty rough 18 to 24 months in the tech space. There were a lot of supply chain disruptions that began with the fallout of the COVID lockdowns and all that stuff. We went from a shortage of chips and tech components to an oversupply. So there were a lot of supply side issues that had to be resolved within tech.

Then you had that big wave of inflation. Coupled with the supply chain issues, that created a tough time for the consumer. So you didn’t see as much discretionary spending for that little window. Since June 2022, Nikia, inflation has come down quite a bit. Now, it’s still hanging around, but it’s been about a year now.

So I think the consumer has been able to recuperate, and we’re seeing a little bit more discretionary spending.  A lot of that money out of consumers' pockets is flowing back into tech. And not just that. To the point you just raised, there’s a lot of innovation. And with that comes the potential for an increase in profit and earnings. And that’s what really attracts money in the financial markets. 

Nikia Wade: That makes total sense. Right now, you can't go on any financial news site or look at any major headlines without there being some kind of mention of AI. It is everywhere, whether it’s the surge in ChatGPT usage or updates on social media.

The thing is, everyone isn't actually making the profits they want when they do invest. There's obviously a huge interest, but not everyone is getting those double-digit or three-digit gains.

So where do you think that many investors are falling short, and what are some of the challenges with investing in even today's tech market, especially with AI and semiconductors? Where are investors going wrong? 

Gianni Di Poce: I think a big part of it is access to the right information. There is no shortage of information on the internet, but I think it comes down to the quality of that information. Now, when it comes to tech, it’s a leading sector in the market. So we tend to see it top out before the rest of the market. We also tend to see a bottom up before the rest of the market.

Coming into this year, there were a lot of people who were really scared and concerned for the direction of the economy. But, we have the receipts Nikia. We can go back and look at those Benzinga Insider Pro reports in December and January. And we were not very bearish coming into this year. We thought it was a good buying opportunity, and we were looking at a lot of these tech names in the first quarter and really doubled down on it in the second quarter because we knew they were on sale.

Let’s just face it: Tech is by far, in a way, the most important sector in the overall market. So if tech does well, a rising tide does really lift all the ships, and it’s going to help the overall market. And hopefully we do see some follow-through here. But I’m really encouraged by the strength that we’re seeing from the tech sector and that it could turn into other sectors of the market as well.

The Tech Stock That Soared 46% In Mere Days

Nikia Wade: Yes, I love it. I’m sure that’s really good news for the listeners. Everyone, at the end of the day, you get in the market because you want to make money. So speaking of making money … You’ve had some success with investing in the tech industry. I know there was a very recent win that you had with one tech company. We won’t give the name up quite yet, but tell us about that. What drew you to the company? How did you identify the opportunity? Give us the details!

Gianni Di Poce: Well, it’s a semiconductor stock. And it kind of ties into that whole chip story with respect to the supply side that I shared a little bit ago. Here's what I like to do. Whenever I see an emerging theme coming from the stock market, I like to look at related and associated industries. I focus on something that’s upstream on the supply chain, I consider things that are going to benefit on the secondary or tertiary effects with respect to emerging economic trends.

The stock that I was looking at had some pretty good technical pictures. I’m a big technical guy. I do like chart patterns, and I was checking off all my boxes in that regard. During my research, I saw some pretty good evidence of accumulation. And there are ways that you can look for those signals to see if there's money flowing into a stock and if that's translating to strength in that stock just yet.

This one came up on my radar because it was exhibiting some relative strength, meaning that it was outperforming the index. And when that happens, it’s usually a sign that if the overall market starts to rally, then a particular stock will outperform to the upside. So that’s always something I’ll look for as well. With this technical pattern that I saw in this stock, it was indicative of a reversal in trend.

I recall a few minutes ago when I said, you know, tech went through a transitional period between 2021 and 2022 where it underperformed after years of outperforming. But it’s looking like, in hindsight, that was really a good time to start accumulating.

So I thought the stock was on sale. It had really strong cash flow. We actually saw cash flow. Its free cash flow increased almost 70% compared to the previous year. And this stock is also heavily involved in the AI space, creating a lot of those chips and components for all the computers and programs that need to exist to create the neural network for artificial intelligence.

Not only that, but the stock is heavily involved and invested in the 5G infrastructure development. So I think there’s a lot of demand for this company's services. And when I saw that it was significantly off its all-time high from a couple of years back, I thought it was on sale. So I shared it with our readers, and we had a really nice pop in a short period of time. 

Nikia Wade: So for those who are listening, I was crunching the numbers. So for this particular stock, the entry price was $45. You recommended it on May 22. Four days later, it popped from $45 to $65.65. So we’re talking about a 46% increase in just days. So if I would have gotten in on your recommendation … If I bought 112 shares at $45 a piece, I would have walked away with an additional $2,300 in just a few days. Is that right? 

Gianni Di Poce: Yes! That does seem correct, Nikia.

Nikia Wade: I told you that I was crunching. That’s really incredible. What are your thoughts on that? Have you gotten any other feedback after that pop in price for that stock recommendation?

Gianni Di Poce: I had an upside target of around $60 initially. So we put out the alert, like you said, on May 22. Then, that day the stock opened at $45.04 and we had a sell target of $60. Its earnings report was a couple of days later. It gapped up significantly after hours, and it opened almost 20% higher the day after its earnings report. And that would have been on May 26. And then in a matter of two days, the stock ran up over 40%, like you said.

So [the company] had good guidance. They kind of talked through the headwinds the industry has been working with. And they said, "Hey, we might have some certainty when it comes to sales and other revenues in the near future. But ultimately, we think this high demand that we’re seeing from a plethora of industries is going to power us through that." And that was enough for the market to bid it up 40% or so in just a couple days. Obviously, our earnings reports don’t always end up that way. But, as I like to say, the trend is your friend. And we saw signs that the trend was changing.

The good news is, there were technical signs that the bulls were starting to shift momentum back into their favor. And it’s just amazing, time and time again, Nikia, when you see these patterns unfold before these big moves and all you have to do is manage risk and make sure that you’re not going to get caught with your pants down. 

Sometimes, you get those big moves in a short period of time. And it’s really nice when that happens. It allows you to walk away with that nice profit in a short period of time.

The Big Reveal

Nikia Wade: I think that I was even being a little on the conservative side, right? I thought if I dropped $5,000 upfront ($45 a piece for 112 shares), I'd have a nice return. But if someone had a little bit more pocket change, (s)he could have gotten up to five grand in gains…There’s so much that somebody could do with that. That could be your next vacation with your family or you could go ahead and reinvest in the next recommendation that you send out.

So I think that really just reaffirms that comment that you made earlier; there’s obviously a demand. People want to invest in tech, but not everybody’s getting the results that they want. And it’s because there’s so much information on the internet, but it’s not necessarily the right information.

Gianni, you've managed to find a way to locate so many different stocks. You’re giving out quite a few different stock recommendations on a weekly basis. And it’s common that we’re seeing strong two-digit returns.

So that’s what the people are looking for. So I guess we can go ahead, right? I feel like we've shared enough, so we can go ahead and reveal! So what was this company that you recommended? What’s its name? What’s its ticker symbol? We can let the readers know all about this recent success story…

Gianni Di Poce: Okay, if you say so! It was…

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