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2 Stocks Poised to Break Out Despite the Supply Chain Bottleneck

by | Oct 25, 2021 | Stocks

Earnings season is giving a nice lift to the markets, and I have my eye on two stocks to watch for the holiday season 2021. More on those later…

The major indexes closed higher for the third straight week this past Friday…

The S&P 500 is churning ahead, breaking the gap-down-Monday trend we’ve seen since mid-September.

The Nasdaq is also running hot as traders get ready for the rest of the FAANG stocks to release earnings.

While momentum has been good, we started to see cracks brought on from supply chain issues with the massive miss on Snap Inc. (NYSE: Snap)

That means traders need to watch Facebook Inc. (Nasdaq: FB) carefully when it reports after Monday’s close.

Any kind of negative update on guidance there could send markets lower.

But tech is only one of several industries reporting in a week with a packed slate of earnings…

Between now and Oct. 29, semiconductors, food and beverage, energy and biotech all have big reports that can shake things up. And I have my eyes on two tickers reporting Tuesday that could be the top stocks to watch for the 2021 holiday season.

The Global Supply Chain Bottleneck

Take a quick look around the headlines and it’s easy to see the markets are scared of the global supply chain bottlenecks moving into the shopping season.

The ports of Los Angeles and Long Beach are in the middle of a record high backlog of ships waiting to unload, largely due to the pandemic-driven labor shortage as there just aren’t enough truckers to get things moving.

The shipping hubs handle around 75% of all goods bound for West Coast markets, and about 31% nationwide.

As of Oct. 22, there were 80-some-odd ships waiting off the Southern California coast, with more on the way.

All of this has spooked Mr. Market, with analysts expecting the situation to cause higher prices heading into Black Friday as supplies come up short.

 

But with unemployment andCOVID-19 cases down, and wage growth up above last year’s levels, this holiday season won’t be doom and gloom for the retailers, the manufacturers that can supply them and the companies facilitating those payments as profit margins grow — making them the stocks to watch for the 2021 holiday season.

2 Stocks to Watch for the 2021 Holiday Season

For those reasons, I’m bullish on companies like Hasbro Inc. (Nasdaq: HAS) and Visa Inc. (NYSE: V) as my top stocks to watch moving into the 2021 holiday season. 

Hasbro reports Tuesday before the bell. In its July 26 earnings call, former CEO Brian Goldner, who died on Oct. 12, announced HAS would expand its shipping ahead of holiday supply chain issues. 

“Hasbro expects some toys will be delayed, arriving in the beginning of the fourth quarter instead of the end of the third, but toys will be on shelves in time for the peak shopping season,” Goldner said at the time.

If his assessment holds, it means Hasbro products will be on the shelves and facing a reduced presence from several competitors this quarter. 

And with retail sales looking strong in September and delta variant cases on the decline, things are looking up for Visa through the end of 2021. 

Visa stock has seen big options buying in the November 5th expiration and December monthly calls ahead of its report after Tuesday’s close. 

If shares break above the 100-day moving average of $233.30, the stock faces its next level of overhead resistance at the $240 level. 

P.S. Don’t miss out on Tuesday’s emergency trade alert!

 In addition to those retail names, there are several big names in biotech reporting this week.

Historically November is when we start seeing a rotation into certain corners of the biotech markets.  

Not only do you have earnings, but also industry conferences and regulatory events that can serve as catalysts for a breakout. 

In fact, aggressive “Desk Clearing” FDA approvals have been fueling some of the easiest profits of 2021…

And the next 61 days are poised to be even bigger!

But one ticker could explode in the next week, which is why I’m issuing a rare Emergency Trade Alert live on air… COMPLETELY FREE!

Tune in live and discover how one “100M” FDA decision could supercharge just one $28 stock by the end of this month!

Click here to get the name.

WRITTEN BY<br>Lance Ippolito

WRITTEN BY
Lance Ippolito

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