Joel Litman is pretty well-known in the investment newsletter space, and I’ve looked into several of his presentations recently to find out what his latest stock picks are.
In short, many of Litman’s recent picks have centered around the biotech and healthcare space, and after looking into his clues, I’ve managed to uncover some of them.
Aside from that, my research suggests that there are several technologies Litman is bullish on, including 5G, IoT, and electric and autonomous vehicles. And by reading the Altimetry blog, I’ve gained insight into his outlook on things like inflation, rate hikes, and whether or not he believes we’ll see a recession in the near future.
In this post, I’ll show you everything I’ve learned about Joel Litman’s predictions and what he’s recommending for 2022, including the names of some of his latest picks.
Breaking Down Joel Litman’s Latest Picks
Before we get started, I want to point out that the only way to know for sure what stocks Joel Litman is recommending would be to join one of his services, like Hidden Alpha.
However, I’ve learned a lot by going through different stock teaser presentations he’s released. And the following is a combination of stocks that Litman has specifically named in different presentations and ones I’ve guessed based on the clues he has shared.
So with that said, let’s start by discussing his recent SynBio picks.
Synthetic Biology (SynBio) – “Steve Jobs’ Final Prophecy”
One of Joel Litman’s most recent presentations centers around what he calls Steve Job’s “Final Prophecy.”
In short, Jobs made a statement about the intersection of biology and technology in his final days. And according to Joel Litman, what Jobs was essentially talking about was synthetic biology (or SynBio for short).
What’s that? SynBio is an area of scientific research involving DNA sequencing, genomics, and computer science (among other disciplines), and it’s used for making (and remaking) “stuff” based on nature.
Here’s how Joel Litman describes SynBio:
“At the time, few knew what Jobs meant. His prediction received almost no attention.
But now we know that he was essentially talking about how a suite of technologies would allow us to engineer organisms’ genomes directly, and create an entirely new field of science, called SynBio.
SynBio is basically the combination of computer science with genomic analysis and gene editing, and is now being used to create new materials, new medicines, new food, new fuels, new tests, new products, and so much more.”Source: https://secure.altimetry.com/?cid=MKT615522&eid=MKT616962&assetId=AST228518&page=2
SynBio is a fascinating field with many potential applications beyond healthcare. And some of the specific examples of industries Litman believes SynBio will disrupt include textiles, agriculture, construction, healthcare, and memory storage.
What’s more, he believes it will “create the next big wave of billionaires.”
“SynBio will change the health care system and our agricultural system.
It will change the way we build roads, bridges, skyscrapers, and houses. It will change the way we manufacture clothes. It will change the energy industry. It will change the way we eat… in short… it will completely upend our economy as we know it today.
And it’s going to create the next big wave of billionaires.”
What are his SynBio stock picks?
During Litman’s SynBio presentation, he mentioned one stock he’s bullish on for free and teased four others that he only shares with subscribers.
The first (free) pick Joel Litman revealed was Illumina (ticker: ILMN), which he describes as his “#1 recommendation in the SynBio space today.”
“In short: Illumina is a company you want to buy today and hold for the long term. My recommendation is:
Buy Illumina (ticker symbol ILMN), my #1 recommendation in the SynBio space today, up to $510 per share.”
Illumina is a California-based biotech company that describes itself as a “global leader in genomics.” And the date stamp on the presentation where he recommended Illumina is February 2022, so that appears to be when he recommended it.
What other SynBio companies does Litman recommend?
Litman teased four other Synbio picks in the presentation, and the clues he shared were very limited, so I wasn’t able to uncover all of them. However, my research suggests that, aside from Illumina, one of his SynBio picks is Ginkgo Bioworks (ticker: DNA).
You can see my write-up of Joel Litman’s SynBio presentation for a complete breakdown of the clues he shared and why I think his pick is Ginkgo.
But in short, Ginkgo Bioworks is a Boston-based biotech company that’s building a platform to enable its customers to program cells. And after carefully going through the clues Litman shared in the presentation, this appears to be the company he’s teasing.
What’s he predicting?
Litman believes that investors could “make 100-times their money” over the long-term with the SynBio “platform company” he’s teasing (which I believe is Ginkgo).
“In short: I believe that over the long run, folks who get in at today’s ultra-low price could make 100-times their money or more in the long run, on this soon-to-be dominant SynBio platform.”
Of course, there’s no guarantee any stock will do that well, nor can I guarantee my guess is right, but Ginkgo appears to be the company he’s talking about there.
Several other well-known stock pickers have teased this company lately, too.
For example, Ginkgo appears to be one of the main biotech stocks Whitney Tilson is bullish on for 2022, and investment guru Luke Lango teased it in his “GCT technology” pitch.
In any case, SynBio is one of the main trends Litman has talked about so far in 2022, and Ginkgo appears to be one of his top picks, as does Illumina.
Litman’s 5 “Alpha Profit Code” Picks
During a recent presentation, Joel Litman used the term “Alpha Profit Code” to describe his system for finding stocks, and said there are five “Alpha Profit Code” stocks that “have the potential to be massive winners,” which are all healthcare-related.
Here’s a breakdown of Litman’s five picks…
Stock 1: CVS Health
Litman’s first “Alpha Profit Code” pick is CVS Health Corporation (ticker: CVS), and I know this because he gave this pick away for free in the presentation.
“One of the stocks that the Alpha Profit Code identified is a long-time favorite of mine.
And it’s a company I’m sure you’ve heard of.
It’s CVS Health – the retail pharmacy company with nearly 10,000 stores across the United States. The ticker symbol is ‘CVS.'”Source: https://secure.altimetry.com/?cid=MKT576876&eid=MKT578297&assetId=AST203086&page=2
CVS Health is a U.S. company that owns numerous individual healthcare-related companies, including a retail pharmacy chain called CVS Pharmacy.
And according to Litman, he’s bullish on this company because Americans are living longer, healthcare spending is increasing, and “healthtech” is “entering a massive boom.”
“With Americans living longer than ever before, with health care spending accelerating at a crazy pace, and healthtech entering a massive boom, I highly recommend buying shares of CVS.
As things accelerate, I wouldn’t be surprised if CVS shares doubled within the next 12 months.”
What is healthtech?
The term “healthtech,” at least in the context of Joel Litman’s presentation, is essentially used to describe health-related technologies. And some of the examples of healthtech he shared ranged from medical diagnostic tech to fitness and sleep tracking devices.
Litman also explained that the healthtech industry revolves around data and said that the companies supplying this data “stand to be the biggest winners.”
“See, every last bit of the healthtech industry revolves around one critical thing: Data.
Without huge amounts of data, these devices either wouldn’t work at all, or they’d provide only minimal advantages.
But with data behind them, they become extremely powerful tools.
And it’s the companies that supply the data that stand to be the biggest winners out of this entire revolution.”
Long story short, the “Alpha Profit Code” picks Litman shared in the presentation all centered around healthtech and healthcare data companies.
As with the SynBio presentation we discussed earlier, Litman only gave the first pick away for free – you need to join his service to find out the rest.
But I managed to uncover his picks by following his clues.
Stock 2: “The Data King’s Billion-Dollar Bet”
Joel Litman’s second pick is dubbed “The Data King’s Billion-Dollar Bet,” which is also the name of the research report he’s put together detailing his recommendation.
Here are the clues Litman shared about this company:
“As I mentioned earlier, if you want to know how healthy someone is, you need loads of data.
And the second company the Alpha Profit Code recently uncovered just made a $1 billion bet on it.
They’ve been providing electronic medical records for the past decade, with 3 million health care providers using their systems each day.
In all, this company has data on nearly 250 million patients worldwide.”
That’s not a lot to go off, but after researching what Litman said about his pick, my research led me to a company called Cerner Corporation (ticker: CERN).
Cerner Corporation is a U.S. company that supplies health IT services, devices, and hardware. And according to an April 2022 article on the company website, the company supports “more than 3 million users each day.”
What’s more, the clue about the “250 million patients worldwide” also seems to match Cerner, so this looks like a possible match.
Stock 3: “One Stock to Rule the $657 Billion Healthtech Industry”
According to Joel Litman, his third pick is a company that combines collected data and applies advanced analytics to help optimize it, which he says means a “more streamlined care process” for patients and increased revenues for businesses.
Other than that, these are the only tangible clues he shared:
“Right now, they manage 498 million records…
And they just inked a $925 million deal with two other companies that could help bring their technology to an entirely new level.”
This is a tough one, given the lack of clues.
But if I had to guess, I’d say this pick could be Boston Scientific (ticker: BSX).
Why? Because this company manufactures medical devices, and it acquired Preventice in 2021, a company that develops health technologies for smartphones, tablets, and the web. And the deal involved an upfront cash payment of $925 million.
So, while I’m far from certain, Boston Scientific could be the one.
Stock 4: “The Future of Medicine and the End of Cancer”
To keep the theme running, Litman didn’t share many clues about his fourth Alpha Profit Code pick, but the clues he did share were very specific.
“They just pulled in $1 billion in a single quarter this year, driven by insane demand for their gene sequencing tech for everything from diagnosing rare diseases to tracking the spread of the coronavirus.
Even with this incredible success, they’re still growing.
They’re currently on the verge of an unprecedented technology that can detect early signs of 50 types of cancer by analyzing DNA.”
The only company I could find that matches Litman’s clues is GRAIL, which has developed a test called Galleri that the company says “can detect over 50 types of cancers.”
GRAIL is not a public company, though, so it’s not possible to invest in it directly.
However, Illumina acquired GRAIL last year (2021). Illumina is also in the gene sequencing technology space and the clue about the “$1 billion in a single quarter” lines up.
So this is most likely Litman’s pick based on the clues.
Stock 5: “The Great Hospital Shakeup”
Last but not least, Joel Litman teased the following company that he suggests takes healthcare-related data and combines it with hospital care.
“However, there’s one company that’s taking all this newly available data and combining that with hospital care.
Already, they have 185 hospitals and 2,000+ sites of care all across the United States.
Each year, they treat 32 million patients.
And they take that data to develop technologies and improve patient care on a massive scale.”
To figure out what this pick could be, the first thing I did was run a search for healthcare data companies that work with 185 hospitals in the U.S.
And that led me to a company called HCA Healthcare (ticker: HCA).
How is it a match?
According to this Fact Sheet the company released, the company has over 2,000 sites of care, including 186 hospitals. And the same document states that HCA Healthcare has “more than 32 million annual patient encounters.”
So, this looks like Litman’s fifth “Alpha Profit Code” pick.
What Else Is Joel Litman Predicting?
So far, we’ve discussed a handful of companies Joel Litman has teased in recent presentations, all of which are in the biotech and healthcare space.
However, those aren’t the only companies he recommends.
Litman recommends a variety of companies in different industries, which he and his team identify using the “L.O.C.K. system” he developed.
What’s that? I’ve published a full write-up of the L.O.C.K. system if you want to know what it is and how it works. But the short version is that L.O.C.K. stands for Locate, Operations, Calls, and Kick it or Keep it. And it’s a system that Litman and his team use to find the stocks that are shared with subscribers of his flagship service, Hidden Alpha.
So my point is that Litman doesn’t just recommend healthcare or biotech stocks; what he recommends depends on what his system uncovers at any given time.
And according to a recent presentation, Litman believes that we are still in a bull market for technology, especially technologies like 5G, the Internet of Things (IoT), and EVs.
“You see, Jared, we are still in a bull market, particularly in technology.
Things like the metaverse and virtual reality may be years away still.
But 5G, the Internet of Things, electric and even autonomous vehicle technologies are right here and now.
In fact, these industries alone could be worth trillions of dollars over the next couple of years.
And the companies involved in these technologies will continue to grow their revenues – rate hike or no rate hike. It doesn’t matter.”Source: https://secure.altimetry.com/?cid=MKT621365&eid=MKT624703&assetId=AST232318&page=2
What is Joel Litman’s overall market outlook for 2022?
It’s no secret that 2022 has been pretty disastrous for stocks, but Litman’s outlook appears to be somewhat contrarian to some of the prevailing “doom and gloom” narratives out there. And his approach seems to be grounded in critical thinking and data analyses.
For instance, in a May 2022 post on altimetry.com, Joel Litman addressed some common concerns people have regarding inflation, rate hikes, and a potential recession. And he made a pretty compelling case as to why some fear-based narratives may be overblown.
To me, articles like that highlight how different Litman’s approach is from other well-known stock pickers that have made far more bearish predictions lately.
And even though there’s no guarantee that one “guru” will be right over another, I think it’s good to get different perspectives on this sort of thing, especially when the information is presented objectively, which I’ve found it is with Joel Litman.
In any case, that pretty much sums up what I’ve learned about Litman’s most recent picks and market outlook. Next, let’s discuss who Joel Litman is, what his track record is like, and the different ways you can access his latest recommendations.
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Who Is Joel Litman?
Joel Litman is the CEO of Valens Research, a professional research firm that provides investment research. He also runs a financial publishing company called Altimetry, which sells different stock advisory services and investment-related software.
Unlike most stock-picking “gurus” I come across, Litman doesn’t have an extensive Wall Street background. Instead, he’s a forensic accountant that has developed a system for analyzing a company’s financials to figure out what the “true” numbers are.
In short, Litman says that he and his team of accountants and analysts have identified over 130 “potentially meaningful inconsistencies” between reality and the reported financials of U.S. public companies. And they essentially “reconstruct” these numbers to figure out what the “true” numbers are and load the data into the company’s Altimeter software tool.
According to the Altimetry website, this, along with looking into a company’s operations and analyzing earnings calls, is how he and his team find potentially worthwhile stocks.
Litman’s flagship service is called Hidden Alpha, but the Altimetry website sells two higher-tier services (High Alpha and Microcap Confidential) and the Altimeter software tool, which is essentially a stock screening tool you can use to research different stocks.
Aside from Valens Research and Altimetry, Litman teaches at different universities, and he has been featured on numerous well-known financial sites over the years.
Does Joel Litman Have a Good Track Record?
According to different Joel Litman presentations I’ve looked into, Litman has recommended numerous winning stocks over the years. And from what I can gather, one of his best picks was Advanced Micro Devices, which he says saw “gains as high as 2,247%.”
Not all of Litman’s picks have done that well, and there’s no telling how his future recommendations will perform. But he seems to have a decent track record overall.
Here’s a snippet from his recent SynBio presentation to give you an idea of how his picks have worked out for his followers:
“Across all the research I’ve been publishing over the past few years, we’ve closed out partial positions for gains including 859%, 148%, and 132%. And we’ve got open gains today as high as: 272%, 211%, 204%, and 151% just to name a few. In just over two years, we’ve already had 16 100%-plus winners.
Of course, these are some of my best recommendations and no guarantee for how other picks will perform. Our average gain since publishing Hidden Alpha is 36%, which is much better than investing in the S&P 500 stock index over the same period.”
At the end of the day, there’s no guarantee you’ll make money following Litman’s stock picks, no matter how good his track record is.
But Litman has recommended some great stocks, his approach appears to be data-driven, and while he is selling newsletters like every other stock picker, his promotional methods come across as more ethical and less overhyped from what I’ve seen.
How Do You Get Litman’s Latest Picks?
There are essentially two main ways you can access Joel Litman’s latest stock picks and investment research.
One method is to read the Altimetry Daily Authority blog, as this is where you can get Litman’s day-to-day take on the market at no cost, and maybe learn about different companies he’s tracking from time to time. You can sign up for the email newsletter version if you prefer to read Litman’s emails instead of visiting the blog.
Either way, the main benefit of this method, other than providing you with useful insight into what’s going on in the market, is that it won’t cost you anything.
However, the best way to access Joel Litman’s latest picks would be the second method; joining one of his paid services, like Hidden Alpha, where he shares his favorite new investment recommendation each month and updates you on any existing picks.
The main “drawback” is that it’s not free; Hidden Alpha normally costs around $200 per year. But I’ve seen it advertised for $49 through different presentations. And aside from joining one of his higher-priced services, this is the best way to get his latest stock picks.
Joel Litman recommends a variety of different stocks, and since the markets never stand still, the best way to get his latest recommendations would be to join one of his services.
However, after sleuthing through his latest stock teaser presentations, I’ve learned that at least some of his 2022 picks center around SynBio and healthtech. He also seems to be bullish on technologies like 5G, IoT, EV, and autonomous vehicles.
That’s what my research has uncovered, anyway. And I’ll strive to keep this post updated as I come across new Joel Litman presentations in the future. Thanks for reading.