Tom Yeung here with your Sunday Digest.
Several years ago, we at InvestorPlace and our partners at TradeSmith began working on AI-powered investing systems to bring Wall Street’s edge to ordinary investors. These AI algorithms crunched millions of data points and found connections between fundamental data and future returns that no ordinary human could.
In 2023, for instance, one of Global Macro Specialist Eric Fry’s systems helped us identify Sight Sciences Inc. (SGHT) before a massive 135% rally. Then, in 2024, our systems identified Nvidia Corp. (NVDA) before a 30% rally. Here’s what we said:
The quantitative system sees Nvidia’s recent 15% selloff as overdone… Shares now trade at 25 times 2026 earnings – not far from the average S&P 500 firm…
This weakness could be a long-term opportunity.
The best part is that our AI systems can be tailored to different needs. Some are designed for longer-term “buy-and-hold” investors, while others are crafted for swing traders seeking to compound their gains.
I’m bringing this up now for two reasons.
First, the past several weeks have shown the importance of keeping a cool head. President Donald Trump’s “will-he-or-won’t-he” tariff threats have shaken some of the most confident investors out of the market, even as our own analysts have urged people to stay invested. AI can help investors see through the roller coaster of emotions.
Second, trading today depends more on the news cycle than ever before. Bull markets can quickly turn to bear ones (and back again) on a single social media post. We foresee more of this happening over the next four years, which means AI and other quant tools will become essential in sorting through the daily deluge of information.
That’s why we’re reintroducing An-E, the top AI-powered algorithm from TradeSmith. This system has now been trained on over 1.3 quadrillion data points and is the work of dozens of Wall Street and MBA professionals.
In addition, the system is based on a short, 30-day holding period. That means it can react quickly to news, and allow gains to quickly compound over time.
And at TradeSmith CEO Keith Kaplan’s upcoming AI Predictive Power presentation, he’s going to walk you through how the upgraded “An-E” works – live, on camera.
Keith will demonstrate how to get your own forecasts and use An-E’s confidence gauge to stack the odds in your favor. He’ll even share a few of An-E’s latest predictions. Click here to save your spot.
Now, I’d ordinarily love to reveal An-E’s top picks for you right here. In fact, its current top 10 bullish picks have a historical target accuracy of 72%. That’s a phenomenal “hit rate” for any system… let alone one focused on short-term moves.
But I’ll have to leave Keith to do that unveiling in his presentation. In the meantime, I’ve been allowed to reveal five picks from Luke Lango Price Breakout quant system. These firms are equally promising, and give you a sense of the power that AI and other quant systems have in finding great investments in turbulent times.
Buying the (Garlic) Dip
Our first pick is a pizza company virtually everyone knows. The 41-year-old firm has grown to over 6,000 locations worldwide and has differentiated itself by targeting a higher-end clientele than that of Domino’s Pizza Inc. (DPZ) or Pizza Hut from Yum! Brands Inc. (YUM).
We’re talking about Papa John’s International Inc. (PZZA).
In ordinary times, Papa John’s trades in the upper 20X forward price-to-earnings range thanks to its capital-light business model. The company outsources the cash-intensive restaurant business to franchisees and collects an average of 5% to 6% of revenues. That means its returns on invested capital average 15% — twice the market average. Papa John’s also maintains a steady dividend that’s averaged a 1.7% yield over the past decade.
The market’s recent selloff now makes PZZA a dough that’s ready to rise. Shares of this high-quality firm trade at just 18X forward earnings after a 35% selloff, and this cheapness is also reflected in an ultra-high dividend yield, which now sits at 5.5%. (All else equal, a lower share price increases the dividend yield.) The last three times PZZA shares traded this cheaply were in May 2024, July 2018, and June 2012. In those instances, shares jumped between 15% and 35% over the following months.
Luke’s Price Breakout system sees a similar outlook this time around. Papa John’s maintains a strong brand and positive same-store-sales growth. And the firm remains far better capitalized than markets seem to think with a 3X interest coverage ratio.
Though market troubles are far from over, Papa John’s shares are now too cheap to ignore.
Serving Up Dividends
Our next pick might not serve fresh 14-inch pizzas… but its price is equally appealing.
Over the past several decades, SpartanNash Co. (SPTN) has pumped cash by supplying grocery and household goods to retailers and government entities. Its long list of customers includes the U.S. military, and more than 2,300 independent grocers.
This Michigan-based firm is usually not exciting… nor does it want to be. Earnings are relatively stable, and it has recorded only one year of losses in the past 20 years. Military bases, after all, always need food delivered.
Fortunately, this predictability makes SPTN an attractive target for quantitative systems. The stock tends to trade in a narrow band, and any system using machine learning (ML) eventually figures out they can generate consistent profits by buying these companies low and selling high.
The recent selloff has now put SpartanNash’s stock at its “buy low” point. Dividend yields have edged above 4.5%, and shares trade for 0.9X book value – a typical bottoming-out level. The last two times this happened were in June 2024 and December 2024; shares rose roughly 15% each time afterward.
For long-term investors, it’s a chance to buy a blue-chip firm for cheap. And for short-term traders, it’s a chance to score double-digit gains by investing in one of the most boring companies on Earth.
Taking the Show on the Road
Rising tariffs on Chinese goods have battered e-commerce companies that sell to Americans. Shares of Amazon.com Inc. (AMZN) have slipped 8% in the past month, and those of Temu owner PDD Holdings Inc. (PDD) have plummeted 23%. Fewer
affordable goods to sell means lower profits for e-commerce marketplaces.But not every e-commerce player is affected by the trade war. In fact, some may even benefit.
That’s likely why Luke’s Price Breakout system has chosen South Korean e-commerce giant Coupang Inc. (CPNG). The “Amazon of South Korea” is the country’s largest retailer, responsible for more than 1 in every 8 Korean won spent on consumer goods. Its “Rocket Delivery” network is unbeatable, providing same-day or one-day delivery services to roughly 99% of the country.
American tariffs on Chinese goods will now create a pent-up supply of products seeking a place to go. Much of it will end up in Southeast Asia or the European Union – China’s two largest trading bloc partners. And a large chunk will also find its way to South Korea, which has traditionally been China’s fourth-largest trading partner behind these two blocs and the United States.
That would prove a windfall for Coupang, which generates profits based on the volumes of goods sold. Analysts have upped their 2026 earnings-per-share forecasts for CPNG to $0.83, up from January’s estimates of $0.78, and they foresee topline growth in the mid-teens for the next several years. CPNG might also benefit in the short term from nervous investors seeking to diversify.
American markets might be trending down… and our AI system says looking beyond the U.S. might be the key.
More Belt-Tightening?
In December, I named Dollar General Corp. (DG) as my top stock to buy for 2025. The stock had dropped to irresistibly low levels, and shares appeared ready to bounce on a new administration.
Though the past four years might have been difficult for Dollar General, the changing tide of rural consumer sentiment makes DG my No. 1 pick for 2025.
Shares of the rural-focused retailer have since risen 17%, compared to a -10% decline in the broader S&P 500 index.
Luke’s quant system believes there’s still time to get into this conservative play. This week, the AI system ranks DG in the top 5% of all companies to buy.
One reason could simply be an investor pivot toward defensive stocks. Companies like Dollar General tend to do well during periods of belt-tightening (since they provide essential goods), and shares will often rise during periods of economic strain. The stock surged 36% in the middle of the Covid-19 pandemic.
The other reason is that Dollar General is still wildly cheap relative to other retailers. Companies like Costco Wholesale Corp. (COST) and Walmart Inc. (WMT) continue to trade at over 35X forward earnings, leaving DG (16X earnings) as one of the few “value” stocks left among its class.
Shares have an enormous upside on “multiples expansion” alone, and Luke’s quant system is sensing an opportunity.
Buying the Tariff Bounce
Finally, our last recommendation includes JBT Marel Corp. (JBTM).
In January, Chicago-based John Bean Technologies merged with Iceland-based Marel Corporation, creating a global manufacturer of food service machinery. The two firms now have one of the broadest portfolios in the industry, covering everything from industrial citrus juicing machines to extrusion blow-molders for bottle-making.
According to Luke’s system, JBTM’s recent 25% drop in share price now puts the company in oversold territory. The stock trades at a reasonable 17X forward earnings, and is essentially back to where it was pre-merger. This is despite the combined firm having far better protections from U.S. tariffs than before. JBT Marel now has factories in over a dozen countries, and earns 50% of revenues from aftermarket parts and services, which are less affected by tariffs.
To be sure, JBT Marel is still exposed to some tariffs because it must import steel and other raw materials to produce its machines. It’s also sensitive to changes in industrial demand; shares sank as much as 45% during the Covid-19 pandemic.
Still, Luke’s quant system suspects the selloff has finally gone too far. So, it’s making a contrarian bet on a JBTM bounce.
Using AI to Forecast the Future
It’s hard to overstate how close the investing world is to a full-blown AI revolution. What once took months of analyst meetings, financial modeling, and “boots on the ground” research can now be replicated in seconds.
It’s also about accuracy. These AI models don’t get tired. They don’t suffer from emotional bias or cognitive dissonance. And they don’t worry about the things that should not matter.
The results speak for themselves.
An-E predicts the moves over the next 21 trading days of thousands of stocks… and its “Confidence Gauge” signals its conviction level of its own projections. TradeSmith’s editors then scan An-E’s readings to find where its highest projected price gains match with its high-conviction “Confidence Gauge” signals.
This kind of AI system is made for this kind of market.
The recent tariff news caused a sharp market correction.
Some stocks will rebound – but others are headed for a steeper fall. And here’s the thing: Most investors won’t know which is which until it’s too late.
But with An-E on your side, the odds of you finding more winners and avoiding more losers are higher than before.
That’s why TradeSmith is holding an emergency briefing on Wednesday, April 16, 2025 at 8 p.m. Eastern – called The AI Predictive Power Event. During this event, you’ll discover exactly how this tech works… and how it can guide you through today’s market storm.
And just for signing up, you’ll get five of An-E’s most bearish forecasts – stocks it’s projecting to drop hard in the coming weeks.
Bottom Line: We’re in the middle of a dramatic global trade shift – and the markets are feeling the heat.
But An-E can still find winning trades in a down market.
Whether you’re playing offense by targeting winners or defense by avoiding losers, An-E gives you the clarity you need when it matters most.
Click here to sign up for The AI Predictive Power Event now and get five of An-E’s most bearish forecasts immediately.
Until next week,
Tom Yeung
Market Analyst, InvestorPlace