Technology stocks are tumbling once more…
Driving the fall was a major drop in Meta Platforms’ (FB) share value. In FB’s fourth quarter, the company reported its user base declined for the first time ever.
This sent shares of FB spiraling, which plummeted by 27% following the social media giant’s press release. It also reversed the broader technology industry’s brief Netflix (NFLX) and Spotify (SPOT) fueled rally.
In turn, a variety of companies have once again seen a hit to their share values – as the sector was already facing increased pressure due to inflation and the likelihood that the U.S. Federal Reserve will raise rates over the course of 2022.
And it could get even worse for the industry as investors sell off tech and growth stocks over fears that their portfolios may further struggle amid ongoing market volatility.
Still, it’s not all bad news for investors. When one aspect of the market struggles, we tend to see other areas benefit. This is particularly true for value stocks, commodities, and cyclicals.
And as investors shift their portfolios to more defensive plays, companies like Scotts Miracle-Gro (SMG) are anticipated to benefit.
That’s because the company operates in a space that will almost always see strong demand – particularly in the spring and summer seasons.
This is due to the fact that Scotts Miracle-Gro is a lawn and gardening company best known for its brands Roundup and Ortho. And these products help it generate strong revenues and profits during peak lawn-care seasons.
However, it also benefits from its exposure to the marijuana market, as the company’s Hawthorne business manufactures and sells hydroponic farming tools and equipment to cannabis producers.
And while the marijuana industry has struggled in recent months, its Hawthorne division has grown more than 100% over the past two years thanks to the fact that it has exposure to the sector without any of the risk.
This trend may continue as well. Despite volatility in the space, legalization is gaining steam all across the U.S. But even on a less marijuana-related note, the pandemic has pushed many Americans to move to the suburbs – increasing demand for lawn-care products as we inch closer to warmer weather.
And with a dividend yield of 1.95%, Scotts Miracle-Gro also offers shareholders consistent passive income to help shore up their portfolios.
Billionaires are cashing out of stocks at a record pace right now.
The disturbing reason behind this move could soon accelerate the market's downturn. Tech stocks are already off to their worst start since 2008.
Consider Tesla, for example.
Though it's still a beloved company by many, Elon Musk recently dumped $12 billion of his own shares, for a selfish motive that could soon rock the market.
And he's not alone.
The wealthiest Americans have recently sold more than double the amount of stock as they did in all of 2020, a trend that could soon worsen.
If you own any “brand-name” stocks, take action now.
The market just saw its worst week since March 2020 – and what's happening among the wealthiest CEOs could soon cause a disaster.