As with most new beginnings, the New Year inspires most to contemplate the past and set goals for the future.

I won’t dwell on the past for too long but to say I’m quite happy with the performance of the Profit Catalyst Alert portfolio and with the evolution of the service overall.

I offered 16 new stock trades in 2017. Of those still open, the average unrealized gain is 6%. For those that I suggested closing, the booked gain was a resounding 42%. This is a pattern you will see. If a stock or option has a huge run, I will often book the gain.

I closed 14 stock trades that had been opened in 2016. Those averaged a gain of 29%, a profit well above the 20% move in the S&P 500.

One of my goals last January was to increase the number of options trades recommended as many subscribers voiced their desire to trade more options.

Profit Catalyst Alert surpassed my internal expectations on this count. I suggested over 40 options trades, 9 of which are still open. Booked gains averaged just above 25% with some over 100%.

Of course, the flip-side is that some options expired worthless, a frustrating but real risk in buying puts and calls. I endeavor never to have this happen, but if my timing is off or if I am simply wrong on a call, it is a possibility.

Here’s to a prosperous 2018.

Despite the above average gains enjoyed last year, I still expect solid stock performance this year. The turning of a page on the calendar does not put an immediate brake on stock prices.

In fact, the average gain in a year following a high double-digit increase in the S&P 500 is quite high. Historically the following year rises almost 13%, significantly higher than the market’s average of 8.5%.

I do expect an increase in volatility, which should help our options performance. One of the inputs to options prices is the level of market volatility so this jump is bullish for option prices.

I also expect rotation out of some of the more expensive sectors of the market (industrials and chemicals for example) into less hyped groups that are pivoting towards growth (some retail and drug groups).

Investors will need to be particularly careful about which stocks to buy. With valuations stretched there is little wiggle room in stock prices for missed expectations. I think this will be a great year for stock pickers who focus specifically on the fundamentals of each stock as opposed to blindly buying indices.

Lastly, I expect a robust IPO market. The recent down-step in Uber’s valuation in the private sector should be a warning bell to companies expecting unlimited valuation via private equity investments.

Also the solid performance of many IPOs this year should welcome young companies looking for new capital and liquidity in their shares. I expect to find many new stocks for us in this corner of the market.

As always, if you have questions, please post them on the Profit Catalyst Alert message board, and I will answer as quickly as possible. I appreciate any comments or suggestions to help improve the service.

Around the portfolio:

ANI Pharmaceuticals (NSDQ: ANIP) purchased four new drug applications (NDAs) from AstraZeneca (NYSE: AZN) for $46.5M  It acquired the NDAs and U.S. rights to market ATACAND, ATACAND HCT, ARIMIDEX, and CASODEX. AstraZeneca will continue to market and supply The purchase was funded through a combination of cash and debt.

Semiconductor supplier stocks Applied Materials (NSDQ: AMAT), Ichor Systems (NSDQ: ICHR) and Lam Research (NSDQ: LRCX) sunk with the rest of tech due to fears that Apple’s next iPhone would not live up to expectations.

Shares of Apple (AAPL) slid 2.5% after a Taiwanese newspaper reportedly said the tech giant is telling suppliers that it is trimming its first-quarter production expectations. Some notable Apple suppliers were weak following the report.

I still expect robust demand for new semiconductor equipment and supplies (made by AMAT, ICHR, and LRCX) as the semiconductor manufacturers gear up for the next generation of chips.

Smart Sand, Inc. (NSDQ: SND) announced the completed construction of its rail facility served by the Union Pacific Railroad in Byron Township, Wisconsin. The Company moved its first unit train from the site on December 26, 2017.

“With construction completed, we now have the capacity for several hundred railcars and the optionality to ship unit trains on both the Union Pacific and Canadian Pacific railroads from our flagship Oakdale, Wisconsin mining operation,” stated Charles Young, Chief Executive Officer.

“Combined with the expected completion of our previously announced drying capacity expansion by the end of March 2018, we believe that our Oakdale, Wisconsin operations are well positioned to take advantage of the improved flexibility, service reliability and freight pricing that rail competition will provide. We are confident that having these choices in rail carriers will allow us to remain competitive while driving down costs and improving efficiency.”

Systemax (NYSE: SYX) jumped almost 10% on news of a special dividend. The company announced a special $1.50 dividend after the close December 26. It will be payable January 12th to holders as of January 8th.

This one-time payment is fresh evidence that the company’s balance sheet is in great shape.

Executive Chairman Richard Leeds, commented, “We are pleased to return capital to shareholders through this special dividend, which reflects the exceptional performance of our businesses as well as the strength of our balance sheet.  As we enter 2018, we will maintain our strong balance sheet, and remain well positioned to execute on our business plan, invest in our growth opportunities, and explore strategic M&A.”

Steve Madden (NSDQ: SHOO) today announced that the Company will be presenting at the 20th Annual ICR Conference held at the JW Marriott Orlando Grande Lakes in Orlando, FL, on Monday, January 8, 2018, at 4:00 pm Eastern Time.

I’ll be reviewing the transcript and watching the stock to see if the company gives any hints to how its holiday season performed.

Vulcan Materials (NYSE: VMC) got a boost from an analyst at Citi who sees ‘great stocking stuffer’ in a recent Vulcan Materials settlement  Analyst Scott Schrier called attention to Vulcan’s settlement with the Justice Department, which gave the green light to its proposed purchase of Aggregates USA following 17 divestitures. The analyst believes there can be “significant synergies” from the deal and keeps a Buy rating on the shares with a $144 price target.