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I often hear people say, “well it’s too late for that stock - it ran its course straight up with no money left to be made from it” but that is not usually the end of that stocks story. The moral of this article is to… just get started!
It's extremely common for individual stocks, and the overall market, to pull back from their highs. This is a normal and healthy part of stock market cycles.
Even the strongest of companies will take a dip of 10% to 15% or more on their stock price. You have heard me talk about “pull backs” in previous articles before, but here is a different look and approach with them.
There are 100s of possible stock examples, but let’s use Uber, the taxi service and food delivery company. Uber has made some traders good money on multiple occasions in the past 60 weeks. The stock price has ranged from:
$60 in March of ‘24
$82 to April ‘24
$65 in May ‘24
$93 to Oct ‘24
$61 in Nov ‘24
$93 today June 26th, 2025
Like the limbo dance - Uber has moved at least three times up and down in a little over a year. So, if you played it (bought and sold) during the past 15 months using 100 shares by this set of parameters you would have made north of $7,000 gain.
Here is where we adjust the approach from trader to long term investor (over a year or more period). Take the final profits and then buy and hold the shares the next time around at $93. You should now be on a trajectory to benefit from a long-term hold on the stock of Uber, as it likely will be taking off soon above $100 as the robotaxi world begins to look like a hockey stick on a graph in the next 12 - 24 months.
I know it can sound easy, and I also agree it is not. It also isn’t tough, with a little attention paid to the process.
If you applied the same strategy with the defense stock Palantir, you would be near term wealthy, for all the up and down gyrations the stock price has done. Palantir is tougher, because it is harder to track the “why the ups and downs?” compared to Uber. Uber tends to move in a tight cycle with Tesla and the semiconductors that represent the Full Self Driving (FSD) tech that robotaxis need.
Palantir has many younger fans because of their CEO who is blunt, intelligent, provocative and talks about being socially responsible. They also have cool tech (mostly platform software) for the defense of this country. Alas, they also have too little revenue for the high price points, with a P/ E that is currently at 621 as of today - yikes! Remember, for long-term investing we want a P / E around 15 but 27 is acceptable and 35 is not but still buyable in certain situations. Palantir has begun an enterprise-based product approach to mid-sized businesses, so they do not rely too much on the pentagon for their livelihood in future.
I sold 200 shares pf IBM last year, after my personal 27% gain, at a price of $195. I will not do any crying in my soup, but today IBM is on the threshold of $300 a share - oops. My mistake wasn’t selling at that moment; I should have removed “just my original costs (shares worth $28,400) off the table” and let the rest ($10,600) run to $300. Now, you are betting with house money - you cannot be hurt if the shares fall in price. The fundamentals that drove me to buy IBM at $142 were still there, still in place and were damn fine. IBM is probably a good bet still at $300, as some analysts see it getting to $350 before year end (a 17% profit) or even $400 by 2027 / 2028 (a 33% uplift), due to its reawakening with its AI consulting and product lines. At least I put those IBM earnings immediately towards more Nvidia shares, so I am doing fine.
The key here is to get comfortable with the process. Instead of using 100 shares use 10 (or even 1 share) to see how you do. There are two ways to go swimming - jump in and get that shock of the cold-water to your system. Or you can go swimming by dipping your toe in the water to get used to the temperature.
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