Bank of America Corp (BAC), Ford Motor Company (F): Kids Won’t Stay At Home; They Will Buy a Home

Page 1 of 2

I found myself laughing at this Yahoo! Inc. (NASDAQ:YHOO) article that depicts those who are 16 to 34-years of age. The millennial generation (me being one of them) is a a group of kids who live in front of four inch screens, has to screen shot everything that goes on (Instagram,) and live at home with parents (this actually sucks.) Now, that doesn’t mean all millennials live at home with mom and dad, but a lot of them do.

Bank of America Corp (NYSE:BAC)

Trends in teenagers

I think the most interesting things that the author, Rick Newman, brings out is the fact that the percentage of 16 to 24-year-olds with driver license declined below 70% for the first time since 1963. The point is, kids are not buying cars and not buying homes. Much of it may have to do with the fact that the unemployment rate is 16.1% for 16 to 24-year-olds. So these younger consumers are substantially more budget conscious, and have to adhere to better spending principles.

The up-trend

Source: Ycharts

So the data seems a little crazy. But basically over the past three years we have seen three trends emerge: Durable goods new orders are on the rise as shown above. The overall population has grown by about 2.2% over the past 3 years, meaning that the increase in demand for durable goods is primarily driven by older laborers returning to the labor force and buying things like cars, homes, and etc. This is excellent news because in a trickle-down-economy, older people will eventually lift the younger people into the workforce. So for now, durable good demand is primarily driven by people who were unemployed and now re-employed. If anything, the younger generation will eventually be a part of the labor force and will increase consumption of durable goods.

Buy property, lending, and cars

I believe that the housing market is unquestionably on the mend, and it is likely to turn around. KB Home (NYSE:KBH) should be a compelling investment opportunity that investors should pursue. The company grew Q1 2013 revenues to $405 million versus the $254 million in revenue in 2012. The growth in revenues was drive by a strengthening economy paired with an increase in the average selling price of homes. The company’s selling price of homes jumped from $219,000 to $271,000 between the first quarter of 2012 to the first quarter of 2013.

Analysts on a consensus basis anticipate the company to grow earnings by 136% in fiscal year 2013, implying substantial upside potential for those who are patient enough to buy into this homebuilder.

Page 1 of 2

Biotech Insider Alert - $6 Stock To Hit $40

$200 Million Dollar Healthcare Hedge Fund's #1 Best Idea Right Now

The best healthcare hedge fund out there right now is one of the largest shareholders in this biotech stock. The fund returned more than 20% in each of the last 2 years with a virtually fully hedged portfolio, and it's sending out a BUY signal on this biotech stock. Get your FREE REPORT today (retail value of $300)

This is a FREE report from Insider Monkey. Credit Card is NOT required.
Click here to Read Comments
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 74 percentage points in 2.5 years. Our beta is only 1.2 (download a FREE newsletter and see the details inside)

Lists

Best Selling Magazines in the World

Shortest People in History

The Most Celebrated Holidays in the World

Most Expensive Handbag Brands in the World

Top Selling Comic Book Issues of this Century

The Most Powerful Women in Politics

Best Paid DJs

Most Rebellious Female Artists

Best Paid TV Actresses of 2014

Best Paid Actors of 2014

Most Expensive Horses in the World

Tallest People Ever

Most Encouraging Feminist Celebrities

Best Paid Supermodels of 2014

Top 10 Suburbs for Retirement in 2015

10 Wealthiest Cities in America

Top 10 TED Talks for Entrepreneurs

Best TED Talks on Education

25 Most Dangerous Places to Live in America

Top 10 Ski Resorts in the United States – 2014 List

Top 10 Most Remote Places in the World

Most Visited Museums in the United States

Wealthiest Photographers in the World

Most Famous Gay Athletes

The World’s Most Famous Circuses

Best Hair Stylists

Most Popular NASCAR Drivers

The Best Romance Movies of all Time

The Most Wanted Drug Lords

The Oldest Money Managers

The Greatest Directors in the World

Largest Animals in the World

World’s Most Expensive Desserts

Best Selling Comic Books of All Time

A-list Actors who Sabotaged Their Career

Rappers With a College Degree

The Best Jazz Albums of all Time

The Most Influential Jazz Musicians

The World’s Most Famous Photographers

The Best Oscar-Winning Songs

Most Influential Choreographers Ever

Most Expensive Department Stores in the World

The Most Expensive Stolen Paintings in the World

The World’s Most Expensive Teas

Top Oscar Record Holders

The Most Expensive Flowers in the World

Countries With a Booming Film Industry

Most Expensive Cupcakes in the World

Uncommon European Escapes

The Most Stolen Artists in History

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 129% in 2.5 years!! Wondering How?

Download a complete edition of our newsletter for free!