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How to Profit on Innovation

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    Cabot Money Management CIO Rob Lutts on sectors where major innovation is occurring.

  • Duration 4:08
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Welcome back.

Innovation revolution be taking place without investors in real I think it -- want money manager -- -- absolutely rob.

What's Cabot money management CIO and president says there are some industries undergoing significant change in animation to present.

Real good growth opportunities for a lot of investors she's got the innovations and the specific companies could benefit rob joins us.

-- is a great subject I love the fact that some of the most innovative.

Companies we have now started in the doldrums of the 1970s like FedEx like Microsoft like -- so.

I think you're right on on the -- you mention one industry energy and of course we've seen this -- incredible technology with regard to fracking and other techniques to get oil and gas.

What company is perfectly positioned to take advantage of this.

Well as you know you know volumes of drilling -- really expanding I think natural gas is gonna expand about five to seven fold.

From what it was just five years ago.

So I think some of the companies and we selected of the -- in these really productive areas Kodiak the other way -- want to Kodiak oil and gas go ahead.

Caught Kodiak oil and gas KOG is the symbol.

It's nine dollar stock we think they have the potential to earn well over a dollar a share next year so we think it's about 2030%.

Undervalued they have volumes are gonna go up about 4050%.

In the next two -- three years since the great way to play that.

Innovative fracking and at what it is really amazing our economy.

Is the most adaptive resilient and innovative and this is just one industry that is renovating and reinvigorating himself.

That's it no it is another one there and when you say productivity -- mean you mean security and data think of all the Chinese hack attacks that we've been talking about so companies involved in this sort.

Of industry.

Private right companies are now putting lots -- more data are on line the networks -- very important in those networks need to be protected.

So source fires the company we've selected the air FIRAs assemble.

It's growing about 3040%.

A year and it's really about protection of data are that the company has available on their networks.

Do you need to have much better protection.

If you look at what.

CIOs are interest -- in the information officers say it's really.

Keeping that data data are away from the bad guys and there's more bad guys looking forward today -- -- -- have been.

Rob I'm gonna push -- -- Israel us archer but Biotech -- you know Biotech is one of those things -- we -- a lot of small but not a lot of fire yet.

But there's one company -- not make health I don't know if I'm Jean comic health letter -- -- you're not you're you're no mention Genomic Health -- why do you like that is an example of Biotech is about to take off.

We're working hard.

Define the leading companies taking advantage of this new DNA data mapping data and it's really taking the data and looking at it and figuring out how to treat people that are so for example cancer in this company works in cancer they really have some great products in the of breast cancer area and -- developing colon and prostate.

But they help doctors -- -- what's medicine to use to come up with a better results for patients.

And finally let's talk transportation and hybrids and Tesla motor and I have a standing did it's can want to jump in here -- Yeah test -- test certain well first off the auto -- you know most.

Vehicles out there are still using combustion engine the same one Henry Ford.

Brought out about ninety years ago.

Tests -- really we think come up with our new way to develop that electric vehicle.

And we think god they're going to do one point eight billion in revenue this year.

2.5 billion next year and it's really all -- -- battery innovation.

They figured out how to take that battery and make it last longer make a more efficient and drive that cost down.

We think we're at the beginning of a major change and and automobiles.

Bob I let you push (%expletive) I I don't know is down 5% today a lot of those projections you mentioned.

Lot of investors doubting whether they'll make them but we got to leave it that we can argue that one another they are -- great suggestions so thank you very much thank you Robert what's good to see you my friend appreciated -- --

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