We’ve touched on a variety of topics the past couple of weeks… And today I’d like to discuss the sinking gig economy stocks… and whether any are a buy at these heavily discounted levels.
What exactly is the gig economy? Well, since the great financial crisis of 2008, the past decade or so has given birth to this new economy that includes jobs with companies like Uber and Lyft, the biggest ride-sharing platforms in the U.S.
The way it works is these people taking these “gigs,” or jobs, are legally considered independent contractors. Of course, some states like California have rebuffed these gig jobs, and some places overseas have made a big stink over it. New York City also tried to change the rules so these gig economy workers are considered employees.
That’s because there are a lot more restrictions on what employees can and can’t do versus gig workers, especially from a taxation standpoint. And there’s far more legal onus and liability on a company’s employees…
For example, say you walk into a Walmart and slip and fall on the floor because some employee left the floor wet. There’s typically more legal liability on the corporation or company in this instance, and it can be sued.
So the way these gig economy companies are structured is to keep them independent of the contractors. They also don’t have to pay taxes and the contractor is required to do so himself, as well as cover their own insurance…
But all things considered… would I buy any gig economy stocks right now?
The big recent news is people want to change how gig economy workers are classified, and for them to become employees…
And a lot of the gig economy stocks got whacked because of it. Uber Technologies Inc. (NYSE: UBER) is down 13% over the past week, and 16% over the past month. Lyft Inc. (Nasdaq: LYFT) is down 10% over the past week, and 17% over the past month (as of Friday afternoon)…
Both Uber and Lyft have crashed far below their 50-day moving averages and could easily fall to their 200-day MAs. Investors are selling these stocks because they just don’t know what’s going to happen. And what does the market hate? Uncertainty!
So are there profits to be made on stocks from the gig economy’s meltdown?
Check out my short video and let’s discuss exactly that. I have a few other tickers to show you as well, including one that I own a position in.
Be sure to check your inbox each Monday for my free Alpha Intel Weekly Watchlist. I’ll also send you free trade alerts pulled from my watchlist every couple of weeks just as a thank you for being a reader.
And as always, please like and subscribe to our YouTube channel and podcast, “Smart Money Circle,” where I interview some of the most brilliant minds in the business. You can also follow me on Twitter, and read more of my thoughts on the market at WealthPress and on Forbes, where I’m also a contributor.
We’ve all heard that buy-and-hold strategies are the surest way to make money in the stock market…
But I’m here to say that’s simply not true anymore.
In fact, I know the secret to making triple-digit gains on stocks like Facebook, Apple and countless other names — big and small… in as little as 24 hours.
These days, traders can stop waiting years for their investments to pay out and start enjoying potentially huge returns today.