Hot Stocks for 2012: Part 1
That chick is pretty hot, but these stocks are even hotter. In part one of this twofer lets take a look at a few of The Bro's top picks for 2012: Apple, General Motors, J.P. Morgan, Magic Software Enterprises, Potash & Hess
Apple: Top 3 Christmas Gifts for 6-10 year olds this year: iPhone, iPad, iTouch. 'Nough said. Q4 '11 is going to be a blow out. Investors have remained cautious after last quarter's disappointing numbers, resulting in a lackluster performance for APPL the last few months. Even after the run up to new highs in the last few weeks, AAPL remains grossly undervalued. Look for a great earnings release later this month continuing through 2012 as the 4S continues to roll out worldwide and the iPad 3 is announced.
General Motors: American Auto is on a tear. Don't be intimidated by the fact this stock is up over 12% in the last 5 days. GM has delivered profitable numbers quarter after quarter, streamlined its corporate structure, reduced margins and continues to build its RIDICULOUSLY LARGE cash position. GM's net cash is over 20 Billion. Back that out of the share price and you get a P/E around 2.25. GM is set to rally, use any pullback as an opportunity to BUY BUY BUY.
Hess: After the holiday shopping season, you may have forgotten that Hess sells more than sweet-ass green toy trucks for 5 year olds. Hess will prove to be a force to be reckoned with in the oil sector in the coming year. HES is trading a 5 year expected PEG ratio of only .84 (compare that to Exxon at 1.14 and ConocoPhillips at 1.54). Hess has made some important strategic plays in the last year and looks to outperform in 2012 as it plays catch up to other oil producers' valuations. Picking the best stock is not always about pricking the best company - it's about recognizing value.
Magic Software Enterprises: Bros love Microcaps, these often overlooked stocks can offer super-sized returns if caught before gaining too much notoriety. MGIC is a great example, but this is not a stock for the faint of heart. Its low trading volume makes it especially vulnerable to market swings and the stock is easily manipulated by large transactions. If you look back at the chart for 2011, you'll get an idea for the type of volatility you might face again in 2012. MGIC has proved over the year that it has, and will continue to, grow earnings quarter to quarter with an expanding customer base. If you believe cloud computing will be the way of the future, buying MGIC gives you means to put your money where your mouth is. Take on the risk, buy the lows, sell the highs and make your wallet very happy in 2012.
J.P. Morgan: 2012: Year of the financial stocks, I'm not so sure...but I do know that whats goes down must go back up..I think. Bottom line, financials are risky, but high risk can yield high reward. My favorite in the bank bunch is JPM. With its high dividend and lower mortgage exposure it continues to be one of the best performers in the pack. I wouldn't want to miss this rally.
Potash: World population is going up, arable farmland going down. Solution? Increase crop yields. Potash is the number one supplier of the fertilizer potash. And despite the lack of corporate name creativity this company is ready to roll. The last few months POT has taken a beat down on speculation of lower Asian demand for the fertilizer in the near term. As a result, current valuation is now very attractive and the addition of POT can get your portfolio super high. The company is set to profit handsomely from increasing Indian demand in 2012, especially if proposed government subsides push though.
***Information on this site is for informational and entertainment purposes only and is not to be considered as a solicitation or recommendation. The authors do not guarantee the accuracy of any of the information presented on this site. Investing can be extremely risky.The authors of this site are not connected with the financial industry and nothing here should be construed as giving financial advice. The authors may and often will own the stocks they pick. The authors give no guarantee of the accuracy, truthfulness, candor, precision, sureness, strictness, definitude, legitimacy, verity, reliability, completeness, veracity or preciseness of any information presented and in no way are the authors responsible for any damages or loses incurred by using information contained in the site.*****
