Category Archives: nov

2 Methods for Evaluating 2010’s Top Stocks

There are multiple ways to gauge the “top” stocks of 2010.  Below is two different methods to gauge the top S&P 500 stocks of 2010. The first list contains the top stocks based on year to date price performance, which is the obvious method for gauging the top stocks of the year:

Ticker Company Sector Trend Analysis Performance YTD
CMI Cummins Inc. Industrial Goods Here 142.95%
Q Qwest Communications International Inc. Technology Here 91.94%
HBAN Huntington Bancshares Inc. Financial Here 91.74%
AIG American International Group, Inc. Financial Here 91.03%
ZION Zions Bancorp. Financial Here 89.46%
AKAM Akamai Technologies Inc. Technology Here 89.11%
PCLN priceline.com Incorporated Services Here 85.75%
FDO Family Dollar Stores Inc. Services Here 82.27%
WFMI Whole Foods Market, Inc. Services Here 82.26%
PXD Pioneer Natural Resources Co. Basic Materials Here 81.98%

However, another method for gauging price momentum is to average returns over multiple time periods..  Below is the average quarterly, half year, and 1 year return for stocks in the S&P 500. As you can see, the list produces a different list:

Ticker Company Sector Trend Analysis Performance (Quarter) Half Year Year Sum
CMI Cummins Inc. Industrial Goods Here 20.97% 70.11% 137.86% 76.31%
MWW Monster Worldwide, Inc. Services Here 84.61% 102.83% 36.12% 74.52%
PCLN priceline.com Incorporated Services Here 16.54% 129.81% 76.98% 74.44%
ANF Abercrombie & Fitch Co. Services Here 48.28% 90.77% 66.52% 68.52%
AIG American International Group, Inc. Financial Here 52.92% 66.29% 80.89% 66.70%
NOV National Oilwell Varco, Inc. Basic Materials Here 48.11% 101.37% 49.25% 66.24%
CF CF Industries Holdings, Inc. Basic Materials Here 35.84% 112.97% 45.16% 64.66%
FCX Freeport-McMoRan Copper & Gold Inc. Basic Materials Here 38.66% 103.12% 48.62% 63.47%
MEE Massey Energy Co. Basic Materials Here 70.92% 93.55% 23.38% 62.62%
F Ford Motor Co. Consumer Goods Here 35.77% 66.07% 65.58% 55.81%

No positions

Data Source: Finviz

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Jim Jubak’s 8/26 article focuses on the falling production of the major oil producers and is bullish on the long term trend in oil prices because of the mismatch between rising demand and falling production:

The big Western oil companies have been locked out of the most promising areas in the world for oil exploration. It’s not just that these companies control only 13% of today’s oil production — down from 50% or more in the 1970s — but that they have so little access to the most promising areas for future production.

National oil companies in countries such as Russia, Iran, Saudi Arabia and Venezuela control access to roughly 80% of the world’s existing and probable oil reserves. And that percentage is rising as more countries move to take back or reduce exploration and production agreements signed with the international oil majors.

There are three ways he proposes investing in this trend: 1) Smaller oil and natural-gas companies that are showing big increases in production now and that have announced substantial discoveries that will go into production in the next decade. Names he includes, DVN, UPL, CHK, and APA. 2) National oil companies with the world-class technology to exploit the next generation of difficult geologies. There are really only two names here, PBR and STO. 3) The “pick-and-shovel” companies that supply drilling pipe, fittings, deep-sea drilling rigs, and oil-exploration and field-management services. The three names here, SLB, RIG, and NOV.

As of Aug. 26, he’s adding PBR to Jubak’s Picks with a target price of $85 a share by March.