I’ve been writing for InvestorPlace for nearly six years and if I’ve learned anything, it’s that you win some and lose some. However, to transition from a merely good analyst to a great one, you’ve got to learn from your worst calls and not just rest on the laurels of your best calls. I think evaluating best and worst calls of 2020 is especially pertinent as we head toward an unknown future.
Since this will be one of the last stories that I’ll write for 2020 – thank goodness, we’re almost there! – it’s an opportunity for me to share my general forecast. First off, I’m not as optimistic as perhaps many of my colleagues are. That’s not to cast aspersions on them but rather, I simply fail to understand how we can resolve our eviction crisis and labor market disruptions when the money velocity is at record lows.
That signals that we have a culture of deflation. In other words, the government can inject all kinds of money into the system. But if the people end up saving it like they have during this crisis, those injections would be meaningless. Indeed, assumptions about the novel coronavirus has resulted in some great ideas but also some of my worst calls.
Second, I’m not uber-confident that I can continue ignoring some common sense fundamentals. Yes, some of my best calls of 2020 came from the assumption that as long as wealthy people do alright, we can somehow patch our economy up along the way. But it’s one of those questions that keeps me up at night – can our society function when small businesses are being gutted everywhere?
However, if there is one source of optimism, it’s that politically, we’re returning to a traditional platform of diplomacy. Look, I understand that President-elect Joe Biden isn’t everyone’s cup of tea. Personally, I find Democrats in general hard to deal with. But the chaos of the Trump administration was too much. So, we have something to look forward to as we now look back at my best (and worst) calls of 2020.
- Ford (NYSE:F)
- Nikola (NASDAQ:NKLA)
- Big 5 Sporting Goods (NASDAQ:BGFV)
- Camping World (NYSE:CWH)
- GameStop (NYSE:GME)
- Beyond Meat (NASDAQ:BYND)
- Mind Medicine (OTCMKTS:MMEDF)
- iBio (NYSEAMERICAN:IBIO)
- Bitcoin (CCC:BTC-USD)
- Ripple (CCC:XRP-USD)
Before you start typing an angry email to the editor, please note that I’m currently writing about 120 articles a month for various publications. By no means is this list conclusive. It is, however, a diverse (and hopefully entertaining) take on my best calls and absolute whoppers of this pandemic-disrupted year.
Best Calls of 2020: Ford (F)
Ford is hardly what I would term one of my best calls from a pure upside perspective. However, this idea is special to me in that for years, I’ve blasted American car companies as being the epitome of mediocrity and the acquiescence to defeat. But with Ford’s move to electric vehicles, specifically its Mustang-branded Mach-E SUV, I have finally embraced Detroit muscle.
Well, sort of. While it’s true that in my automotive portfolio, I have nothing but American car investments (including F stock), I’ll probably live my entire life never owning one of the underlying products. Look, I’m all for U.S. manufacturing and homegrown innovations. But I also want to be able to get from point A to point B in a reliable manner. Do you feel me? Or are you writing up that angry email to the editor?
Anyways, I also wanted to mention F stock because I think it has a realistic upside pathway. Sure, Tesla (NASDAQ:TSLA) has proven to be awesome, there’s no doubt about it. But even with the lowest-price Tesla, the Model 3 commands a consumer demographic that makes over $128,000 a year. I’m not sure if that’s sustainable, especially heading toward a possibly prolonged recession.
But Ford? We’re traditionally talking about the everyman car.
Worst Calls of 2020: Nikola (NKLA)
Nikola. Even the name is going to give me nightmares.
Therefore, I’m going to get the ugliest of my worst calls of 2020 out of the way. My liking of and subsequent speculative wager on NKLA stock was stupid. I’m not talking run-of-the-mill stupid, as in bumping your head as you’re trying to get into your car. No, I’m talking disturbingly stupid, like a presidential tweet at three in the morning.
What first enamored me was the exterior styling of the proposed Nikola Badger. Initially, it was scheduled to go into production near the end of 2022. In my opinion, it has all the right elements of being a successful electric pick-up truck, with a design that’s futuristic yet familiar. Further, the paper statistics suggested that the Badger can really tear up the drag strip if the driver wanted to.
However, there was just one problem: apparently, the whole thing was a sham. Frankly, I don’t need to repeat the story as it’s been covered up the wazoo. And with a scaled-down partnership with General Motors (NYSE:GM), the Badger dream appears to have ended.
Of course, the lesson for NKLA stock is that you’ve got to pay attention to the fundamentals. Ironically, that’s what I’m saying for the rest of the market.
Best Calls of 2020: Big 5 Sporting Goods (BGFV)
Since the novel coronavirus pandemic caused a complete disruption in American society, I’ve been talking frequently about gun stocks. Around late May was the first time that I presented a gallery article exclusively discussing the firearms, ammunition and self-defense industry. At that time, you could have bought shares of Big 5 Sporting Goods for under $2.
At time of writing, BGFV stock is approaching $12, easily making this one of my best calls from a fundamental and technical perspective. I’m going to leave the latter part alone since you can do the math yourself. But the former component is what investors should focus on. When the next crisis hits this nation, you should probably think cynically. It can possibly make you a quick buck.
Ordinarily, BGFV stock wouldn’t be something to consider, not in the slightest. Even during the mad rush for firearms, Big 5 didn’t exactly appeal to everyone due to its lack of a robust selection; just shotguns, hunting rifles and rimfire caliber guns. In other words, no handguns or AR-15 “black” rifles – don’t you dare call these assault rifles or you’ll get your own angry emails to the editor.
But Big 5 does carry ammunition, which is what every Second Amendment-loving American needs.
Worst Calls of 2020: Camping World (CWH)
Back during the immediate fallout when the coronavirus truly became the serious threat it is today, it seemed that we were headed toward the zombie apocalypse. Years of CQB training and listening to Alex Jones kicked in, putting me into the proper frame of mind. And that meant WWSKL: what would Senator Kelly Loeffler do?
Naturally, this translated into “sell, sell, sell!” or at the very least adopting a cautionary approach. Easily my most popular article in my InvestorPlace career was “30 Stocks on a Deathwatch.” It attracted so many readers and you know what the weird part was? I don’t think I ever got hate mail for it and that has the freakin’ Grim Reaper as the main art. Go figure.
Anyways, I had Camping World on this list, and it became one of my worst calls. CWH stock is one of those ideas where I don’t think you can blame me. Come on … who’s going to go RVing around the country during a pandemic? The answer turned out to be rich people who were scared of getting sick but were too cabin fevered to shelter in place.
Honestly, part of me is still confused about CWH stock. But the lesson here is never underestimate American wealth (or is that stupidity)?
Best Calls of 2020: GameStop (GME)
Typically, I don’t recommend going against the grain of sage advice. When you look at InvestorPlace stories including GameStop over the past seven months, you’ll notice that most of them are bearish. But among those suggesting that GME stock can move higher, most of them are written by me.
I’m not bragging because frankly, this ship could have sailed in either direction. But I personally gambled that it would sail toward the bulls. I was right. In fact, I’d say I was righter than I could have imagined, making GME one of my best calls for 2020. Here are two paragraphs that sum up my thesis:
To no one’s surprise, alcohol consumption during the dark days of the national lockdown went up, as did other vices. As I just mentioned, the pressure on mental health has been crippling for millions of Americans. They need an outlet, and many have chosen alcohol.
But such behaviors are obviously not great for long-term health nor are they beneficial to the wallet. But cheap, secondhand video games? That’s a relatively easy way to cope with the pressure. Plus, physical console purchases are one-time only. Naturally, this represents a pivotal contrast to subscription-based entertainment services, such as Netflix (NASDAQ:NFLX) or Disney (NYSE:DIS).
Truth be told, I’d probably consider taking some off the table given the explosive gains. But fundamentally, I still like the narrative here.
Worst Calls of 2020: Beyond Meat (BYND)
Even though Beyond Meat has been demonstrably confirmed as one of my worst calls of this year, I still have skepticism toward it. Who knows? Maybe my disbelief could make BYND one of the best calls for 2021. But for now, I’m going to do what a leader of great authority would: complain that the market is rigged and say that all my calls are the best calls in history.
No, I’m just joking. While I didn’t see the appeal in plant-based meat, many people did. Further, the pandemic presented a fundamental catalyst for BYND stock. As Covid-19 disrupted supply chains in an unprecedented manner, meatpackers warned that the outbreak could lead to meat shortages. In some terrible cases, animals had to be put down because there was no market for them.
While it’s hard to quantify how much of this dynamic affected BYND stock, even a skeptic like me had to admit that this whole situation was grotesque. If anything, segments of the human population need a culling. Animals are innocent. They don’t steal others’ work and property, as one of many examples.
Still, the biggest risk factor moving forward is that the plant-based meat market will become commoditized. But for now, Beyond Meat is leveraging its brand, which makes this one of my worst calls of the year.
Best Calls of 2020: Mind Medicine (MMEDF)
After getting burned badly by the cannabis sector, I was a little hesitant to consider psychedelic stocks like Mind Medicine. If weed is a stretch for some folks, I’m not sure if shrooms are going to be any better.
But I’m glad that someone took the time to explain the benefits of psychedelic investments and specifically MMEDF stock. At one point – shares have come down significantly in recent sessions – it was a true ten-bagger. So yes, this was one of my best calls.
Assuming that psychedelic medicines will integrate itself into the mainstream – and I believe this will be the case – MMEDF stock will go down as one of my favorite among personal best calls. That’s because if you scroll all the way down on InvestorPlace’s quotes list for Mind Medicine, who was the first person to mention psychedelics?
That’s right. Yours truly. And yeah, I’ll admit it. If I’m going to brag about something related to InvestorPlace, it’s probably going to be this.
Having said that, I’d wait until the volatility dies down before engaging. But when it does, here’s the key point to remember: “Yes, psychedelics are dangerously addictive narcotics. But when administered by medical professionals, they offer effective solutions where standard medicines have failed.”
Worst Calls of 2020: iBio (IBIO)
Although iBio has become one of my worst calls, I need to be fair to myself. No, this isn’t a cop out, as I’m going to take responsibility for the good and the bad. But I was also one of the early voices in media that urged people to take the coronavirus seriously. Hence, I suggested in March of this year that IBIO stock could have a longer runway than arguably most people would have thought at the time.
Therefore, if you had bought IBIO when I wrote the article and sold on its July peak, you would have made out like a bandit. However – and here’s where the responsibility part comes in – I still suggested that shares presented a speculative buy opportunity around mid-September.
Bad move. At time of writing, IBIO stock is lower than it was when I wrote about in March.
For me, the lesson is that you’ve got to know when it’s time to quit. As well, with other Covid-19 vaccine and treatment players making far greater clinical progress, it wasn’t time to come up with cute, contrarian ideas. While I did go bearish late November, I still regret writing positively about it in September, no matter my caveats at the time.
Sadly, I’m going to have to close my iBio narrative on a sour note.
Best Calls of 2020: Bitcoin (BTC)
For my final pick among my best calls of 2020, I’m going to go with, what else? Bitcoin, baby! To be quite blunt, I will say that my call on cryptocurrencies require a grain of salt. Chances are, if it’s related to the blockchain, I’m probably going to say something good about it.
Thus, I have a broken clock effect going on here. I’m just keeping it real with you all.
But this broken clock really hit the sweet spot recently when BTC topped $20,000, only to keep on surging to ultra-fresh plateaus. At time of writing, the king of cryptos is approaching the $24,000 level. I’m not sure if it will break above that psychological marker given how wild this sector is. Here’s the thing – never say never with bitcoin.
As you might guess, I’m bullish heading into 2021. Just in case we may not have another chance to “talk” again, just know that barring a nuclear attack from the Chinese, Russians or the North Koreans, I’m going to be bullish in 2022, 2023, 2024 … you get the idea.
Quite simply, cryptocurrencies offer the convenience and flexibility that stocks can’t provide. With the baby boomers retiring en masse, we’ll probably see an increasing rotation into the blockchain.
Worst Calls of 2020: Ripple (XRP)
Finally, my friends, not every cryptocurrency is a winner. Ripple provides a painful reminder of this, dropping sharply while bitcoin and other altcoins (alternative cryptocurrencies) enjoyed meteoric profitability. Just what in the heck happened?
The Securities and Exchange Commission, that’s what. As a vanguard of the federal government, the SEC has a vested interest in protecting the sanctity and viability of the U.S. dollar. From this perspective, it wasn’t terribly surprising – though I must say it was incredibly disappointing – that the regulatory agency filed action against Ripple Labs Inc. and two of its executives.
At the heart of this issue is whether XRP is a security or not. Admittedly, cryptocurrencies trade like they’re securities, with global exchanges providing a hub for day traders 24/7/365. Perhaps, the federal government’s argument is that if it quacks like a duck, it must be a duck.
It’s a complicated issue. But the prosecution of Ripple seems to contradict SEC Chair Jay Clayton’s 2018 guidance on blockchain reward tokens. “Cryptocurrencies: These are replacements for sovereign currencies, replace the dollar, the euro, the yen with bitcoin. That type of currency is not a security.”
However, if it’s determined that XRP specifically is a security, then we could have serious reverberations. For now, Ripple is a reminder that cryptocurrencies still have a Wild West theme to it.
On the date of publication, Josh Enomoto held a long position in F, NKLA, GME, MMEDF, BTC, and XRP.
A former senior business analyst for Sony Electronics, Josh Enomoto has helped broker major contracts with Fortune Global 500 companies. Over the past several years, he has delivered unique, critical insights for the investment markets, as well as various other industries including legal, construction management, and healthcare.