Let’s start with the stocks to avoid. Avoid Celestica $CLS. The company pivoted to industries that are faring poorly. Shares fell to a new 52-week low after reporting quarterly earnings. $CLS, Celestica, Inc. / H1 Speculation In the resource space, Watch Chesapeake Energy. $CHK. On Feb. 1, it completed its $4 billion acquisition of WildHorse Resource Development. After lowering its debt profile, CHK could not resist with a big acquisition. Plus, shareholders allowed for an increase in authorized shares, from 2B to 3B. $3 Share Price a key resistance point for the stock: $CHK, Chesapeake Energy Corporation / H1 User Vangel says it best: Take a company that engages in uneconomic activities and issue a lot of equity to fund them. Borrow a lot of money by using the debt markets. You then keep the uneconomic activities going for as long as possible as management and the underwriters keep getting paid as they spin metrics like total production and ignore free cash flows. The trick is to use the SEC rules to overstate earnings and turn losses into apparent profits. You take well data from the core areas and use it as the basis for the EUR calculations. Take the hyperbolic decline model and choose a 'b' parameter that will give you the highest EUR possible. Note that a reasonable value for 'b' is between zero and one. But the industry uses a value of 'b' that is greater than one and makes a few minor adjustments to deal with the fact that a 'b' > 1 is not allowed in the Arps formula that is used because it leads to infinity and a clearly observable divergence between the model and the reality. But it gets more interesting for me. The industry can rightfully argue that shale formations are heterogeneous so it should have a lot of room in how it calculates EURs and reserves. But the same industry also lobbied the SEC to permit it to assume homogeneity so that it could state reserves without needing to engage in infill drilling. The bottom line is that shareholders are not told that reality and models do not agree so the incomes being reported are not correct. A company like CHK has destroyed more than $12 billion in capital and cash and is now smaller than it used to be. While that does not matter today, the endgame is inevitable. Left for $7, $GE is no longer a value trap. The stock shot back to above $10 after markets finally embraced CEO Larry Culp’s visions. JP Morgan Analyst Tusa is at his usual bearish rant against the company. With liabilities quantified for GE and funded, unknowns are greatly reduced. Chinese New Year is this coming Tuesday. Will China spend any time talking business to the U.S. on a trade deal? Can it wait for 14 more days? If not and the two countries agree on a deal, load up on oil: $XOM, $BP $CVX, $COP. When the Nov-Dec 2018 panic selling picked up, the DIY Value Investor service chose Enbridge $ENB for the dividend income. The stock returned ~ 20%: $ENB, Enbridge Inc / H1