Readers’ Choice: 10 Best Stocks for 2012

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To help investors kick off 2012 the profitable way, InvestorPlace recently launched its 10 Best Stocks of 2012 page. The feature includes 10 long-term investments from a group of money managers, market experts and financial journalists. And these are no “set it and forget it” picks, either — throughout the year, the writers will regularly offer updates on the good, the bad and the unexpected as it relates to their best stock for 2012.

Of course, the investing world is made up of a lot more than just 10 people. It includes you, the reader! So in the interests of finding out where you plan on putting your money in the new year, we took a poll to get your thoughts about who in our panel — if anyone — got it right.

In the end, we got 7,646 votes. The final tally can be seen by enlarging the graphic on the right, but popular opinion trended toward the market’s big boys — three of the top five vote-getters were the three Dow Jones components picked by our panel.

The glaring last-place finish was Turkcell Iletisim Hizmetleri AS (NYSE:TKC). While Turkish telecom might not be on many people’s radar, it was the top pick by Charles Sizemore, who rode Visa (NYSE:V) to a resounding victory in our 2011 feature.

Also sitting outside of the top five were 10.) Capital One (NYSE:COF), 9.) Arcos Dorados (NYSE:ARCO), 8.) Banco Santander (NYSE:STD), 7.) MAKO Surgical (NASDAQ:MAKO) and 6.) Hershey (NYSE:HSY).

Continue reading to find out what InvestorPlace readers chose as their top stocks for 2012:

#5: Alcoa (744 votes, 9.73%)

Alcoa AAAs with previous picks Caterpillar and FedEx, InvestorPlace.com editor Jeff Reeves has leaned in favor of broad economic recovery with his recommendation of aluminum giant Alcoa (NYSE:AA).

Not only will growth in demand and higher prices result in bigger Alcoa profits, but overly negative sentiment has provided a great entry point, Jeff writes.

“Yes, big problems persist in the global economy, and aluminum demand and prices remain weak as a result,” he writes. “However, Alcoa hasn’t seen the $9 level since spring 2009. Are the macroeconomic fears really worse now than in 2009?”

In addition to valuation, Jeff likes Alcoa’s improving earnings, dividend potential, streamlined operations and hope for better margins in 2012.

Read Jeff’s complete recommendation on Alcoa.

#4: FedEx (748 votes, 9.78%)

FedEx FDXCNNMoney’s Paul R. La Monica said, “When I was asked to pick one stock to write about for InvestorPlace that I was confident would do well next year, I immediately started thinking of companies that should benefit from a steadily improving U.S. economy.”

At the end of his deliberation, Paul settled on FedEx (NYSE:FDX).

Don’t think this is just a play on a broad-based recovery, though. A discounted P/E ratio vs. rival UPS (NYSE:UPS), a strong dividend history, recent rate increases and the lack of competition from a U.S. Postal Service in disarray are all reasons to be bullish on FedEx.

“FedEx may not be flashy. But that’s kind of the point,” Paul writes. “In a market where volatility seems to be the new black, you could do a lot worse than a stable blue chip with steady earnings growth.”

Read Paul’s complete recommendation on FedEx.

#3: None of the Above (1,138 votes, 14.88%)

Almost 15% of you took a look at the FedExes and Turkcells of the world, shrugged your shoulders and said, “Eh, what else do you have?” And who could blame you? In a domestic market featuring hundreds of stocks, it’s not a stretch to say this group of 10 isn’t the end-all list of potential big tunas!

While the poll was closed-ended and didn’t have a write-in spot, feel free to use the Comments section to sound off on what you think will trump all 10 of these stocks!

#2: Microsoft (1,232 votes, 16.11%)

Blogger, author and founder of Stockpickr James Altucher joined a similar InvestorPlace.com feature in the beginning of 2011, picking one stock to buy and hold all year. Back then, he picked Microsoft (NASDAQ:MSFT) — and his choice is the same a year later.

Similar to his previous write-up, the highlights of this year’s recommendation include:

  • 8x earnings
  • Huge stock buybacks
  • Secret weapon: Skype replaces all smartphones within next five years

The idea of Skype taking over the mobile market is intriguing, considering voice represents so little of what we can do with our smartphones these days.

Read James’ complete recommendation on Microsoft.

#1: Caterpillar (1,916 votes, 25.06%)

Caterpillar Inc. (NYSE:CAT)Investor and CBS MoneyWatch columnist Dan Burrows picked industrial giant Caterpillar (NYSE:CAT) as his best stock for 2012.

His reasons? Dan says CAT stock was oversold during the summer volatility, has good fundamentals (including retail sales that grew 31% in October) and a bargain valuation with a forward price-to-earnings ratio of about 10.

“Wall Street’s mean (and median) price target for Caterpillar currently stands at $114.50, according to Thomson Reuters data. Add in the 2% yield on the dividend, and the stock offers an implied return of 28% in the next 12 months or so,” writes Dan. “Not too shabby for a company with a market cap of more than $58 billion.”

Read Dan’s complete recommendation on Caterpillar.

Check out InvestorPlace.com’s other looks back at 2011 and ahead to 2012 here.


Article printed from InvestorPlace Media, https://investorplace.com/2011/12/readers-choice-10-best-stocks-for-2012/.

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