Value Stocks, Valuations, Volatility, Earnings and AAII Sentiment

The Prudent Speculator Weekly Commentary is expertly curated every week as a valuable resource for stock market news, investing tips, business insights, and economic trends as it relates to value stock investing. In this week’s Market Commentary, we discuss A.I Trade, Value, Economics, Earnings and more Stock News. We also include a short preview of our specific stock picks for the week, the entire list is available only to our community of loyal subscribers.

Executive Summary

Trades – 1 Sale in 1 Account

Week – Terrific Thanksgiving Run

Value – Winners Won More than the Losers Lost in November

Valuations – Reasonable Metrics and Solid Dividend Yields on our Portfolios

Volatility – Ups and Downs but Long-Term Trend Has Been Up

Earnings – Solid Growth Still the Forecast

Econ – Mixed Numbers; Fed Still Expected to Cut Rates

Sentiment – History Shows it has Paid to be Greedy When Others are Fearful

Stock News – Updates on seven stocks across five different sectors

Week – Terrific Thanksgiving Run

Thanksgiving week’s big rally, the 236th best for the S&P 500 over the last near-century,

turned what had been a November frown upside down…for those of us who favor Value-oriented stocks,

with the month living up to its historical propensity for top-tier performance for the kind of stocks we have long championed since the launch of The Prudent Speculator in March 1977,

and offering a reminder that just because some of the high-flying Tech companies suffer a setback in price does not mean that all stocks must perform poorly.

Value – Winners Won More than the Losers Lost in November

Happily, even as we have some A.I.-exposed names that gave up a little altitude, our winners won more than our losers lost last month,

Valuations – Reasonable Metrics and Solid Dividend Yields on our Portfolios

and even with our portfolios at or near their all-time highs, we remain very comfortable with our reasonable valuation metrics and relatively generous dividend yields.

This is especially true as returns on Value stocks over the last 10 and 20 years, while still very good, have been below the long-term norms, suggesting to us that there is still plenty of upside potential.

Volatility – Ups and Downs but Long-Term Trend Has Been Up

To be sure, we must always be braced for downside volatility,

as 5% setbacks have happened every three months, on average, 10% corrections have taken place every 11 months, on average, and ‘official’ Bear Markets have occurred 27 times since 1927,

with an ‘unofficial’ one hitting less than 8 months ago.

As always, the key to success in stocks is not to get scared out of them, as history shows that all disconcerting events have been overcome in the fullness of time,

and lengthening the measuring stick goes a long way in reducing the risk of loss or even the risk of a worse return than the risk-free rate.

Earnings – Solid Growth Still the Forecast

It is also important to remember that an investment in stocks, unlike some other asset classes popular with risk takers today, represents ownership in real businesses that over time see their intrinsic values increase as corporate profits grow,

and dividend payouts rise.

Certainly, the future is not assured, but Q3 EPS turned out to be very good, and the outlook for Q4 and 2026 is for continued growth,

Econ – Mixed Numbers; Fed Still Expected to Cut Rates

even as the economic data out of late has been mixed with consumer confidence for November,

and retail sales for September, coming in below expectations,

while pending home sales for October,

and first-time filings for unemployment benefits for the week ended November 22 were both better than consensus estimates.

Corporate America’s profit reports already told us that inflation-adjusted Q3 GDP growth was pretty good, but the latest projection from the Atlanta Fed stood at a robust 3.9%,

while the most recent set of estimates from the Federal Reserve showed decent GDP growth projections in 2026, 2027 and 2028.

GDP forecasting is fraught with peril and we will get a new set of guestimates from Jerome H. Powell & Co. in 9 days, but the Fed appears likely to lower its target for the Fed Funds rate several times in the year ahead to support economic growth,

with an accommodative Fed another positive factor in favor of equities.

Sentiment – History Shows it has Paid to be Greedy When Others are Fearful

And we will end with the reminder that history shows it has, more often than not, paid to be greedy when others are fearful,

which somehow seems to be the case today, given the preponderance of Bears on Main Street,

and the record level of cash parked on the sidelines in money market funds.

Stock News – Updates on seven stocks across five different sectors

Keeping in mind that all stocks are rated as a “Buy” until such time as they are a “Sell,” a listing of all current recommendations is available for download via the following link: https://theprudentspeculator.com/dashboard/. We also offer the reminder that any sales we make for our newsletter strategies are announced via our Sales Alerts. Jason Clark, Chris Quigley and Zack Tart take a look at earnings reports and other market-moving news of note out last week for more than a few of our recommendations.