Rather opt for the big guns

Finweek English Edition - - Marketplace Simon Says -

I have been watch­ing Delta, as it trades at a sig­nif­i­cant dis­count to its net as­set value (NAV) and it has a great yield – but that yield dropped as Delta cut dis­tri­bu­tion by 15.1%. This is the risk of a stock that’s ‘too good to be true’. It may not be true. The com­pany mostly owns build­ings ten­anted by govern­ment, with month-to-month leases. Now, govern­ment isn’t go­ing any­where soon, but Delta needs to get these leases to longer terms – some­thing the com­pany is work­ing on. The big­ger pic­ture here is that in this cur­rent mar­ket, even great stocks with great re­sults are be­ing pun­ished and, as such, we should not be fo­cus­ing on the sec­on­dor third-tier stocks yet. Let the large, qual­ity stocks run, then we can start look­ing at the rest.

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