Top Stock #1 – AmBev (ABV)
Companhia de Bebidas Das Americas (ABV), or AmBev, dominates the Brazilian beer market. The company also sells its products in some 13 other countries, including Argentina, Peru, Ecuador, Uruguay and Venezuela.
This company is a great buy for two reasons: First of all, beer and soft drinks are consumer staples that have seen strong sales even during tough times. And secondly, AmBev is benefiting from the fact that the Brazilian real has appreciated dramatically against the U.S. dollar since March. The fact that Brazil’s currency has surged over 20% compared to the greenback means that this company’s sales and profits have been boosted significantly simply due to favorable exchange rates.
Top Stock #2 – GoldCorp (GG)
GoldCorp (GG) is one of the largest precious-metal mining companies in the world, operating mainly in Canada and South America. The company produces more than 2.3 million ounces of gold annually and has about 45 million ounces in proved and probable reserves. But don’t be fooled by the name — GoldCorp also owns 1.2 billion ounces of proved and probable silver reserves and 1.4 billion pounds of copper reserves.
Gold and other precious metals have been on a tear lately, setting new highs. In fact, Jim Rogers, a famed investor known for his bullish calls on commodities, recently said that gold would top $2,000 per ounce within a decade. This means the long-term prospects of GoldCorp are quite strong.
Top Stock #3 –
Southwestern Energy (SWN)
Southwestern Energy (SWN) is a pioneer in horizontal drilling. This means that SWN simply taps a well once then drills sideways to access the remainder of the field as opposed to the more costly alternative of erecting multiple rigs that drill down. This technology keeps costs low while boosting output, and is particularly helpful to SWN when gas prices are soft.
For Q3, SWN reported that it earned $118.3 million or 34 cents per share during the quarter, in line with Wall Street’s estimates. That profit was down 63 cents per share from last year due to comparatively lower natural gas prices. The company was able to ramp up production, which helped to offset the price decline, but revenue still came in 26.3% lower compared with the same year-ago period.
I still believe that the future is extremely bright for this booming stock. SWN has been bouncing higher over the last few months, and it is well-positioned make its next big move up as natural gas prices firm up.
Top Stock #4 – Sociedad Quimica y Minera (SQM)
Sociedad Quimica y Minera (SQM), our Chilean chemical giant, is still one of my favorite stocks. SQM has a huge share of the lithium market and should see big sales as demand for this material ramps up in the coming months.
In early October, the company announced its decision to lower its lithium prices by around 20% from current levels in order to accelerate demand recovery. You may think that a company charging less for its product is a bad sign. But as with almost everything in business, it’s a supply and demand game.
SQM’s plan is to boost demand significantly enough that it sells more lithium and subsequently makes even bigger profits than if it left prices unchanged. What’s more, it allows for new customers by providing this crucial element at lower cost. Many of the iconic devices of the 21st century use lithium batteries, including cell phones, laptops, iPods and hybrid vehicles. Encouraging innovation will help ensure SQM’s revenue stream for the long term.
Top Stock #5 – Enersis (ENI)
Enersis (ENI), another Latin American company, is the largest utility in the region. The company distributes power to almost 12 million customers in regions of Chile, Argentina, Brazil, Colombia and Peru. As these emerging regions continue to see strong economic growth as the recovery takes shape, ENI is in prime position to profit. As a growing middle class in Latin America uses more energy for luxuries and high-tech comforts, Enersis should see booming profits.
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Here now are 20 stocks to avoid. If you own these losers, sell them now.
20 Stocks to Sell Now
The following stocks are rated F in my exclusive PortfolioGrader stock rating tool. It’s a great way to rank your current or future investments, and it’s completely free!
Sell these stocks immediately.
- Basic Energy Services (BAS)
- Lexington Reality Trust (LXP)
- Green Bankshares Inc. (GRNB)
- United Western Bancorp Inc. (UWBK)
- BancTrust Financial Group Inc. (BTFG)
- City Bank (Washington) (CTBK)
- West Coast Bancorp (WCBO)
- Synovus Financial Corp. (SNV)
- FNB United Corp. (FNBN)
- Kelly Services Inc. (KELYA)
- MKS Instruments Inc. (MKSI)
- Zygo Corp. (ZIGO)
- LDK Solar (LDK)
- Silicon Image Inc. (SIMG)
- Flotek Industries Inc. (FTK)
- Cavco Industries Inc. (CVCO)
- International Speedway Corp. (ISCA)
- Fisher Communications Inc. (FSCI)
- Toll Brothers (TOL)
- JAKKS Pacific Inc. (JAKK)
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