One of the most popular sessions at the Better Investing National Convention (BINC) this year was a panel session called “Talking Stocks.” The selected panel members pick stocks (I didn’t count, but I believe they each picked 4 stocks) with an eye to see who would pick the best stock by next year’s convention. Their choices are made with a commentary and a lot of good-natured kidding between the panel members.
The funny thing is the panel picks numerous stocks that don’t meet Better Investing standards. Some of the choices did not have positive earnings, with some be speculative choices.
While I was not a panel member, I think it would be an interesting exercise to make my own picks and compare my selections to those made by the panel.
Catalyst Health Solutions
Catalyst Health Solutions, Inc. is a full-service pharmacy benefit management (PBM) company. The Company operates under the brand name Catalyst Rx. The Company provides its clients access to a contracted, non-exclusive national network of approximately 63,000 pharmacies. It also provide its clients members with timely and adjudication, while controlling pharmacy spending trends through customized plan designs, clinical programs, physician orientation programs and member education.
Analysts consensus expect earnings to grow at 20% over the next five years. Their March 2010 quarter EPS grew 21.9% over the same quarter in 2009. Annual revenues grew 13.8% in 2009 while net income grew 29.3%.
Catalyst should continue to thrive even in the face of Obama-care.
Current price: $38.09
Apple
Apple Inc. (Apple) designs, manufactures, and markets personal computers, mobile communication devices, and portable digital music and video players, and sells a variety of related software, services, peripherals, and networking solutions.
I have previously written about Apple on this blog. They should continue to be a dominant force in the mobile phone market. Initial sales of the iPad have total 1 million units per month, and more can be expected from new product lines.
Current price: $253.51
Kinder Morgan Partners
Kinder Morgan Energy Partners, L.P. (KMP) is a pipeline transportation and energy storage company in North America. KMP owns an interest in approximately 28,000 miles of pipelines and 180 terminals. It has five business segments: products pipelines, natural gas pipelines, CO2, terminals and Kinder Morgan Canada. On October 1, 2009, KMP acquired the natural gas treating business from Crosstex Energy, L.P. and Crosstex Energy, Inc.
Analysts expect KMP to grow at only 3.1%, but the stock also currently yields 6.6%.
I originally purchased KMP at a lower price/higher yield point leading to some very nice returns. However, this stock fall a bit short of a typical Better Investing stock.
Current Price: $64.49
Baidu
Baidu, Inc. (Baidu) is a Chinese-language Internet search provider. The Company conducts its operations in China principally through Baidu Online Network Technology (Beijing) Co., Ltd., its wholly owned subsidiary in Beijing, China. It also conducts its operations in China through Baidu Netcom Science Technology Co., Ltd., which holds the licenses and approvals necessary to operate the Company’s Websites and provide online advertising services.
This is a “swinging for the fence” stock pick, with analysts expecting BIDU to grow by 41.5%. Their last quarter of EPS reported an increase of 150%.
With a current PE ratio of 93, this stock is definitely NOT a Better Investing stock. I figure if the panel can make speculative choices, I can pick one for my set too.
Current Price: $72.85
What four stocks would you pick? I thought about picking Altria with a 7% yield that could possibly withstand any stormy markets, which may face us as investors when significant tax increases hit the American taxpayers in January 2011.
By the way, BINC was a great experience. If you have never attended a Better Investing convention or an InvestEd convention, you should consider going to InvestEd 2010 in August 2010.
NOTE: Stock selections in this post are for educational purposes only and is not intended to be a recommendation to purchase or sell any of the stocks, mutual funds, or other securities that may be referenced. The securities of companies referenced or featured in this web site are for illustrative purposes only and are not to be considered endorsed or recommended for purchase or sale. Investors should conduct their own review and analysis of any company of interest before making an investment decision.
Securities discussed may be held by the author in his own personal portfolios.