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Trade of the Day: Splunk (SPLK)

SPLK still rates a buy


For today’s trade, I wanted to reiterate my buy recommendation for a stock that held steady through the selling we’ve seen over the past couple of days: Splunk (SPLK).

Volatility was intense over the past five days, and it served to shake the foundations of what investors felt that they understood about the fundamentals and underpinnings of the global economy circa 2013.

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If you thought that central banks were going to be your “sugar daddy” forever and ever, you were mistaken. If you thought bonds only go up in value, you were mistaken. If you thought that the Federal Reserve could communicate its policy effectively through its Princeton don at the helm, you were mistaken.

However, big-data stock SPLK didn’t seem to be much affected. The company came to the forefront as scandals have wreaked havoc in the intelligence arena, from Edward Snowden’s leak to the NSA’s shady data collection practices. However, Splunk’s business is in the private sector. Its powerful software helps IT and business clients to manage, search and analyze the data they collect and produce.

Since Bernanke’s announcement, SPLK is five percentage points ahead of the S&P. In fact, it’s hardly budged. I still recommend this as a buy and maintain my $46.50 target.

InvestorPlace advisor Jon Markman operates the investment firm Markman Capital Insight. He also writes a daily swing trading newsletter, Trader’s Advantage, which aims to capture profits of 15% to 40% and often as much as 100% to 200% in less than 90 days. 

Professional traders and hedge funds make huge profits off volatility.  Now, Jon’s service CounterPoint Options levels the playing field with the first service geared towards helping individual traders make steady, consistent profits with the VIX.  Get more information on Trader’s Advantage and CounterPoint Options today.

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