Stansberry Research has released a presentation stating that one of the “biggest market bubbles in history” is popping, and there’s one “simple step” we can take to prepare.
The presentation features host Daniela Cambone and investment guru Dan Ferris, and it’s essentially a rehash of Ferris’ February 2022 stock teaser on inflation.
There are some differences, though, which prompted me to write this.
In short, this time Ferris is pitching a different service, Stansberry’s Investment Advisory, and teasing a different investment – his “No. 1 inflation protection stock.”
Ferris says his pick is a “royalty company” and refers to it as the “Best Oil Business On Earth.” He also says it’s his “highest-conviction energy idea today” and that it “could be a 10-bagger when all is said and done.”
Long story short, I looked into Dan Ferris’ clues to find out what company he was teasing and managed to uncover at least one of his oil-related royalty picks (and possibly his top pick). And in this post, I’ll show you everything I found.
But first, let’s unpack Ferris’ prediction.
What Is Dan Ferris Predicting?
What Dan Ferris is predicting in his updated inflation-related presentation is very similar to what he said back in February of this year.
In short, he believes that many people are going to lose “nearly everything” they’ve saved up in the next few years and that some could even get “wiped out” financially.
“The real story is that my heart is breaking because I believe a lot of people are going to lose nearly everything they’ve saved in the next few years.
People are going to be wiped out.”
Why does he have such a bearish outlook?
I can’t speak for Dan Ferris, but according to the presentation, his concern is related to what he refers to as a “long-term top” and “bubble” that he suggests is bursting. And he likens it to some of the biggest stock market crashes in history (1929, 2000, and 2008).
“What we’re seeing today is exactly what a big, long-term TOP in the markets looks and feels like.
We’re watching the bubble burst in front of our eyes, and people are just shrugging at it – which is terrifying.”
“There’s no mystery here about what will happen. This moment is so, so similar to 2008… and 2000… and even 1929.”
We’ve already seen a pretty significant sell-off in the market, especially in tech, but Dan Ferris seems to think it could get a lot worse overall.
“And I don’t know, of course, where the market will be when you see this. The volatility’s been so high, and we’ve had some brutal days… weeks… even months here and there.
But until this market falls 80% or more – in my view – the fat lady hasn’t sung.”
Aside from being concerned that stocks are “more expensive than ever before,” Ferris believes that inflation “isn’t transitory” and is predicting that if things play out how he expects, inflation could create a “financial disaster” even without a crash.
“Because here’s the key thing. If inflation over the next decade plays out the way I’m expecting, it’s a financial disaster even without a crash.
Think about that, even if I’m completely wrong – and most of your guests are completely wrong – and a crash doesn’t materialize anytime soon… which I seriously doubt, by the way – but even then if growth stocks sort of hold their altitude and the market as a whole is just choppy and moves sideways on average, you’re going to start losing money.
Inflation is going to eat the value of your cash, and it’s going to eat some of the value of every business on the planet.”
Inflation, recession, or a combination of both (stagflation)… I don’t think anyone really knows what will happen over the coming months and years.
But according to Ferris, his recommendations are “crash protection” and “inflation protection,” and he thinks they could “soar over the next decade.”
“And that’s why I’m begging you to get some money into the assets I’m recommending. Now. Without delay. It’s crash protection… it’s inflation protection… and it’s set up to soar over the next decade. I believe it’s the trade of the decade, without question.”
What’s he recommending?
Dan Ferris discussed a number of recommendations in the presentation, including hard assets like oil and gold to land and timber.
“Yes. This is what I’m here to show you. You absolutely must own the assets that benefit during inflation. That hold their value – first of all. And better yet that actually soar when all of this is happening.
That starts with so-called hard assets like oil… gold… land… timber… Things like our food supply… things like the real, physical mines that keep our world up and running.
Why? Well for one thing, no matter what kind of calamity strikes… we don’t stop needing food. We don’t stop needing energy. These things keep operating and keep generating cash, if they’re run well, or the world stops.”
However, he also discussed some specific recommendations, one of which was The Sprott Physical Gold Trust (PHYS).
“Even if you just did this and nothing else you’d be way ahead compared to most people. The ticker symbol is P-H-Y-S, as in ‘physical’ and it’s a much higher-quality way to own gold in my opinion.”
And Ferris’ main recommendation was his “No. 1 inflation protection stock,” which he didn’t reveal in the presentation. However, I looked into his clues and managed to uncover at least one of his picks (and possibly his top inflation-related oil royalty pick).
What “No. 1 Inflation Protection Stock” (AKA Best Oil Business On Earth) Is Dan Ferris Teasing?
According to Dan Ferris, he and his colleagues at Stansberry Research have identified what they believe is the “No. 1 Inflation Protection stock in the world.”
“We’ve identified what we believe is the No. 1 Inflation Protection stock in the world. Hands down.”
Dan Ferris says that he considers it to be one of the best opportunities of the next five years and that it could “climb by hundreds of percent.” He also said it’s their highest “highest-conviction energy idea today” and that it could be a “10-bagger.”
“We consider it one of the best opportunities of the next five years… and one of the best stocks we’ve EVER found in more than 20 years of publishing research.
In this environment, it could climb by hundreds of percent if things go right.
We call it the Best Oil Business on Earth – and with good reason.”
“It’s our highest-conviction energy idea today.
And probably better than any similar inflation pick we’ve ever recommended.”
“Longer term, with the turmoil we’re seeing across the world… the supply shortages… and of course what inflation’s doing to oil prices… we think it could be a 10-bagger when all is said and done.”
What could it be?
Based on the above clues, we know that the company is in the oil industry. And according to Dan Ferris, it’s also a royalty company.
“It’s a royalty company. One of the best setups we’ve ever found… in what’s probably our favorite type of business that we’ve ever shared with readers.”
From what I understand, a company with a royalty interest holds ownership rights to a developable oil field and receives some of the revenue that resource generates without the ongoing costs associated with exploration, drilling, and production.
For example, an “oil royalty company” may own the land on which an oil drilling company operates and, in return for letting that company drill, gets a cut of the profits.
Regarding Ferris’ pick, one of the main clues he shared was that it’s “very similar” (except “one-fifth the size”) to a Texas-based company that owns a “huge swath of oil-rich land.”
So in order to figure out what his “Best Oil Business On Earth” (AKA No. 1 inflation) pick was, I first had to figure out what the company he was comparing it to was.
Here are the clues he shared about it:
“Then there’s an extraordinary company in Texas. I can’t mention the name because I have to protect it for subscribers.
All it does is own a huge swath of oil-rich land. This is key. It doesn’t do any of the work of building rigs and extracting oil. And it doesn’t take any of the associated risk, either. Instead, it lets other folks do that, and simply collects a stream of royalty payments in exchange.
So while Exxon has 63,000 employees… this company has less than 100, because essentially all they do is cash checks.
And, Dani, this company is up as high as 4,000% since 2011.”
To figure this pick out, I searched for publicly listed oil companies based in Texas that collect royalty payments, which led me to Texas Pacific Land Corporation (ticker: TPL).
Not only does this company earn oil and gas royalties, but it is one of the largest private landowners in Texas. What’s more, it appears to have less than 100 employees, and its stock has rallied as high as roughly 4,000% since 2011.
So, Texas Pacific Land Corporation matches Ferris’ clues.
However, as mentioned, that’s NOT his “Best Oil Business On Earth” pick; it’s just a company he likes that he compared his top pick with. According to Ferris, his top pick is much smaller, “around one-fifth the size” of that company.
And since Texas Pacific Land Corporation’s market cap is around $12.6 billion as of writing, that means his “No. 1 inflation” pick must have a market cap of around $2.5 billion.
So at this point, what we know is that Ferris’ pick is an oil company similar to Texas Pacific Land Corp with a market cap of around $2.5 billion. Aside from that, the ONLY other clue he shared was that it pays a dividend of “more than 6%.”
“We think ‘the Best Oil Business on Earth’ could triple your money. Not only that but it’s going to give you a fat dividend along the way. More than 6% at current prices.”
That still wasn’t a lot to go off given the sheer number of companies in the oil and gas industry that pay high dividends. However, I stumbled across a list of oil and gas companies and checked the dividends paid by each company within the (ballpark) market cap range of $2.5 billion. And that narrowed it down to the following two companies:
- Brigham Minerals (MNRL) and;
- Black Stone Minerals LP (BSM).
Either of these companies could potentially be his pick.
But if I had to choose one, my guess would be Black Stone Minerals, a Texas-based company that, according to its website, became the largest publicly traded mineral and royalty company in the U.S. after going public in 2015. And according to Reuters, it owns millions of acres of royalty interests.
There’s no guarantee I’m right, and given the lack of clues, I’m less confident about this one than some of the other stock picks I’ve looked into over the years.
But Black Stone Minerals does match Ferris’ description in terms of what it does, it’s similar to Texas Pacific Land Corporation in that it earns oil and gas royalties and owns a huge chunk of land, and its market cap is in the (rough) ballpark of what Ferris alluded to.
What’s more, its current dividend is over 6% as of writing.
So, that could be his pick, but there’s no guarantee, either. If you want to know what company Dan Ferris is recommending for sure, the best thing to do would be to check out his report called “The No. 1 Stock on Earth to Beat Inflation,” which comes with a subscription to Stansberry’s Investment Advisory.
Recommended: Go here to see my #1 rated stock advisory of 2022
What Is Stansberry’s Investment Advisory?
Stansberry’s Investment Advisory is Stansberry Research’s flagship monthly stock advisory that, according to Stansberry, “shows you how to make money from the most promising emerging trends and the most influential economic forces affecting the market.”
The lead editor of the service is Alan Gula, a former Goldman Sachs financial database expert, but the service was originally launched in 1999 by the company’s founder, Porter Stansberry.
What do you get if you join?
As a subscriber of Stansberry’s Investment Advisory, you get monthly issues of the newsletter, which contains research and investment ideas. You also get access to the model portfolio, updates on the recommendations, and research reports.
These research reports include “The No. 1 Stock on Earth to Beat Inflation,” “The 5-Stock Inflation Protection Portfolio,” and lots of others.
How much does it cost? A subscription to Stansberry’s Investment Advisory normally costs $199 per year, but it costs $49 for the first year if you join through the presentation and automatically renews at the full price every year after that.
Is it worth it? As with any service, there’s no guarantee you’ll make money following the recommendations inside Stansberry’s Investment Advisory. And I’m not a member of it myself. But it looks like a pretty decent service for the price.
Who Is Dan Ferris?
Dan Ferris joined Stansberry Research a year after it launched in 2000.
And he’s the editor of a service called Extreme Value, which is a higher-tier service focused on “great businesses trading at steep discounts.”
According to his Stansberry Research profile, Ferris has appeared on numerous popular finance shows, including Fox Business News, and his work has been featured in Barron’s.
And aside from his running the Extreme Value newsletter, Ferris hosts the Stansberry Investor Hour podcast, where he does interviews and shares his market insights.
Dan Ferris’ latest presentation centers around a potential market crash, rising inflation, and his recommendations on how to navigate the situation he sees unfolding.
The only pick he revealed for free was a gold-related investment, but after looking into the clues he shared, I managed to uncover two of his picks.
The first pick I uncovered, Texas Pacific Land Corporation, matches his clues well, so I’m confident about that one. And while I’m less sure about his second pick, the so-called “Best Oil Business On Earth,” my research uncovered a couple of possibilities.
Of course, I can’t guarantee any of my guesses are right, so the best way to find out for sure would be to join Stansberry’s Investment Advisory. That way, you can see exactly what his picks are and get all the details about his recommendations.
Anyway, that’s my take.
Hope it helps, and thanks for reading.