How to Make Sure You're Not Buying Blindly
Editor's note: Everyone needs an edge in the current market...
With inflation and a global trade war weighing on stocks, it's easy for investors to make rash decisions in the desperate pursuit of profits. But Marc Chaikin – founder of our corporate affiliate Chaikin Analytics – stresses that there's more to investing than just solid earnings reports and flashy names.
In today's Masters Series, adapted from the March 4 and April 15 issues of the Chaikin PowerFeed daily e-letter, Marc emphasizes the importance of having a "guiding light" for the market...
How to Make Sure You're Not Buying Blindly
The nurses all knew about the bats. They could hear them scratching inside the walls of the hospital...
At Rockledge Regional Medical Center, the bats caused a big problem.
With roughly 300 beds, it's the second-biggest hospital along Florida's "Space Coast" region east of Orlando.
By the spring of 2023, its bat problem was out of control.
After a nurse caught a bat clinging to a curtain in the intensive care unit, the hospital had to move the entire unit to a different floor.
It also hired pest control. The company found roughly 3,000 bats living in crawl spaces in the building.
The media also got ahold of the story. So Rockledge's management put out a statement...
We are working closely with the Florida Department of Wildlife, Department of Health, the State Epidemiologist, and a pest control company. They have assured us that there is no risk to patients or staff. With their help, we will proceed with mitigation efforts.
The local Fox News channel noted that the hospital would need to hurry...
Bat mating season was about to start. And under Florida law, it's illegal to disturb bats from April 15 to August 16.
In the end, Rockledge spent nearly $1 million to get rid of the bats. But unfortunately, its problems continued...
Later that year, two elevators stopped working. The hospital had to hold off on repairs due to a lack of cash on hand.
In December, some of the hospital's sinks got clogged with black sludge. A patient's granddaughter posted pictures of one of them on Facebook. She also noted that it smelled like sewage.
Rockledge's problems weren't a coincidence. They stemmed from one simple fact... It was poorly run.
After years of mismanagement, the hospital's parent company – Steward Health Care – was in terrible financial condition.
In fact, it never paid the bill for its bat removal. The pest-control company ended up suing Steward for $1.6 million in unpaid services. That number included $936,320 for its work at Rockledge.
Steward operated about 30 hospitals in eight U.S. states. And they all had problems...
One of the company's other Florida hospitals couldn't get its elevator fixed. The repair company refused to come due to outstanding unpaid bills. And instead of paying up, the hospital hired someone else.
Notably, most of the problems we've discussed didn't put patients' lives at risk. But that's not the case for another one of Steward's hospitals...
In Massachusetts, St. Elizabeth's Medical Center had a bunch of its medical devices repossessed. Last year, a woman died after the hospital didn't have the embolism coil needed to save her life.
And across Steward's system, nurses complained about chronic shortages of basic supplies.
Unfortunately, this story doesn't really have a happy ending... Steward declared bankruptcy in May 2024. Its 30 hospitals were sold off to a handful of regional hospital systems.
Rockledge Medical Center is set to be demolished. Its new owner says that renovating the hospital would be too costly. Instead, it's going to build a new facility.
The takeaway here is... Beware of mismanaged businesses.
Folks, if you're like me, you spend a lot of time looking at charts. And you also pay attention to market trends. But at the end of the day, those lines on the page represent real companies and real people.
Put simply, good management matters.
Companies that perform well do so because of good decision-making. Don't forget that.
Even a company with a good product can't escape a management team that's determined to make bad decisions. And you always want to be on the lookout for companies that chronically make the wrong choices.
Folks, my point is simple... You need to make sure you have a guiding light for the market.
The market is currently fighting through a period of elevated volatility. And as I explained yesterday, that will likely continue in the coming months.
You need to know where the danger is. And you need to know when it's time to step aside.
Now, I created the Power Gauge specifically for this purpose...
With custom alerts, you can get updates on your most important positions. And by following the ratings system, you can avoid the market's most dangerous areas.
But no matter what tool you use, I implore you to have a plan in place...
A small investment – in time, tools, or both – can make a big difference. It can be the deciding factor between great returns or an investing disaster.
Good investing,
Marc Chaikin
Editor's note: If you're hiding your money on the sidelines to avoid today's market turbulence, Marc stresses that this won't be enough to protect your wealth. According to Marc, we're on the brink of a huge market shift that will wipe out investors who aren't prepared.
That's why he just went on camera to explain exactly how to position yourself – including a unique setup to potentially double your money. Click here to catch up on the full story...