Eric Fry of InvestorPlace is out with a new stock teaser.
He's calling this one "The Revenge of the Heartland" or "Made in America 2.0."
Fry claims a new "supercluster" of innovation is coming to an unexpected part of the country.
and that he knows a bunch of stocks that are going to benefit from this growth.
The best part is he left enough clues in the presentation to figure them out, and I reveal them below.
I'll give you some information on the stocks as well, so you can determine if they're a good investment or not.
Let's get started!
Revenge Of The Heartland Summary
Creator: Eric Fry
Newsletter: Fry's Investment Report
Stocks: Freeport McMoran, Novonix, Syrah Resources, Piedmont Lithium, Stem and Luna Innovations
This stock teaser revolves around the boom in electric cars and particularly the creation of EV batteries.
Fry believes a new "supercluster" of EV battery manufacturers will propel many states in the Southeast into prosperity.
Most of the stock picks in the presentation revolve around mining companies that will produce the materials needed to make batteries.
This includes Freeport McMoran for copper, Novonix for graphite anodes, Syrah Resources for graphite, and Piedmont Lithium for lithium.
Additionally, there are two companies he recommends that have nothing to do with resources.
They are Stem, which is a battery management software company, and Luna Innovations, which makes fiber optic sensors.
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Revenge Of The Heartland FAQ's
I bet if you watched the "Revenge of the Heartland" stock teaser, you have some questions.
Here are answers to any questions you might have about this presentation.
1) What is the theme of the presentation?
The idea behind "Revenge of the Heartland" is that capital is starting to pour into the Southeast.
This includes Kentucky, Tennessee, Virginia, Alabama, South Carolina, North Carolina, etc.
The reason for this is that automakers have been slowly moving into this region for decades now.
And with the EV boom on the horizon, many large automakers are opening up battery plants in these states.
When something like this happens, Eric Fry claims it's a "supercluster."
This basically means a bunch of businesses and suppliers related to EVs and EV batteries will open in these regions too.
He compares it to the auto boom in Detroit, the tech boom in Silicon Valley, the oil boom in Houston, the biotech boom in Boston, and the finance boom on Wall Street.
Additionally, Fry believes there will be a push to bring manufacturing home to America.
And because of all this, Fry believes certain companies are set to boom.
The stocks that Eric is pushing are related to the EV industry, and all will have a presence in the states mentioned in the "Revenge of the Heartland" pitch.
Most of the stocks have to do with mining, and from the natural resources, EV batteries need to be developed.
There are a couple of stocks that have to do with EV batteries in other ways.
2) What are the mining stocks?
So the first batch of stock picks has to do with mining and natural resources.
They are Freeport McMoran, Novonix, Syrah Resources, and Piedmont Lithium.
Here's some information on each company:
Freeport-McMoran is a large mining company that is the largest copper and gold miner in the world.
Copper is needed when making EV batteries, and that's how this company is connected to the electric battery market.
This company's stock trades pretty closely with the price of copper; when copper prices fall, the stock falls, and when copper prices go up, the stock goes up.
So you're essentially betting on copper prices going higher if you invest in Freeport-McMoran.
Many people believe copper will be more in demand in the next decade, and this could cause a shortage.
This would drive the price of copper up, which would benefit Freeport-McMoran.
Additionally, they have a small dividend as well.
Novonix is the next company pitched by Eric Fry.
This is a company that makes synthetic graphite, which is necessary to create lithium ion batteries.
Novonix was apparently linked to Tesla a few years ago, which made the stock go crazy.
And many stock pickers were pitching this company furiously.
However, the hype from the stock pickers never came to fruition (many such cases!).
This caused the stock to rise quickly and crash back down to earth quickly.
Novonix is a small company that doesn't make a ton of revenue, which is why it trades so low.
It has government grants to build new plants and some deals in other places.
But this is supposed to impact Novonix's revenue for years.
Maybe it gets caught up in a hype train again and sends the stock soaring.
If not, don't expect a return on investment for many years.
Syrah Resources is the next stock being pitched, and it also has to do with graphite.
There are very few graphite mining operations in America, and Syrah Resources mostly mines out of Mozambique.
However, they have a processing plant in Louisiana where they turn the flake graphite into high-grade anodes for batteries.
This plant has a deal with Tesla to produce these anodes (Tesla will be buying 70% of their production).
Other companies, like Ford and LG, are also interested in their products.
However, the plant is not done yet and won't be fully functional until 2025.
The next natural resource stock to watch is Piedmont Lithium, and they have a lithium processing plant in Tennessee.
This company is a little confusing and has operations in Ghana and past deals with Tesla.
Their goal is to supply their Tennessee plant with spodumene from Ghana.
However, reports have come out about their corruption in Ghana, which could have an impact on their grants in America.
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3) What are the non-mining picks?
Lastly, there are two more picks from Eric Fry that have a connection to EV batteries but aren't supplying natural resources.
The first is stem.
This is a company that makes battery management software.
It's used in the EV charging grids and moves around power when needed.
Basically, it stores energy when the price of charging is low, and when the price is high, it returns energy back to the grid.
The last stock pick is Luna Innovations, which makes microsensors using fiber optic technology.
These products are used in 5G networks and assist with autonomous driving.
This is a small company, and there's some big competition in this space.
But people I trust seem to like the moves they've made recently, and they're expected to grow in the future.
4) Is the Fry Investment Report worth buying?
So now that we've covered all the stocks, there's one last question to answer:
Is the Fry Investment Report worth buying?
I did a whole review of this newsletter before and gave it a decent score.
I don't think this service is a must-have or anything like that.
But Fry seems to have a decent ability to pick stocks.
Does he beat the market?
Most stock pickers don't.
However, the newsletter is cheap, and if you can resist the aggressive upsells, it might be worth checking out.
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Wrapping Things Up
So that's the end of my post summarizing Eric Fry's "Revenge Of The Heartland."
There's a lot of stock picks here and they range from size, function and risk.
Overall the play is about EV batteries which a lot of stock pickers are betting on.
These products need resources and the most of the stock picks in this presentation have to do with companies supplying these resources.
The smaller mining companies are very risk, though.
They typically go through boom and bust cycles and you only bet on them if we're in the beginning of a boom.
There's definitely money to be made if you pick the right mining operations if EV takes off like some people believe.
However, there's a lot of risk too and these smaller investments could lose you the majority of your money.
What do you think?
Do you want to gamble on the companies pitched by Fry?
Let me know below in the comments!
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