Stocks getting the thumbs up right now
Posted
Oct 08 2008, 01:28 AM
by
Matt Koppenheffer
Rating:
Fire, brimstone, gnashing of teeth -- it's all terrible! It's the Federal Reserve's fault, it's Wall Street's fault, it's the mortgage brokers' fault, it's everyone's fault. We've hit the bottom... no, wait, there's 20% more downside ahead!
Ok, glad we got that out of the way.
Even though Jim Cramer may be throwing in the towel, I'm actually going to pull out one of his classic lines -- "there's always a bull market somewhere." Now I wouldn't phrase it quite that way, but I do agree that even in awful looking markets like we're in right now, there are stocks out there that are well worth stepping into the void to buy.
The really tough question, of course, is figuring out which stocks fall into that category. To get some help on this question I turned to The Motley Fool's CAPS service to find out what stocks the All-Star CAPS members -- those members rated in the top 20% -- are picking right now.
Though natural resource stocks have taken a major hit over the past few weeks, there are more than a few CAPS members that are using these falling prices as an opportunity to get these stocks on the cheap. TMFSarahGen, who has been correct on her calls nearly 70% of the time, picked Walter Industries today after seeing some positivity from insiders. She said: "massive open market buy by the CFO - means time for a rebound."
SmallKimmie, who also has an impressive 60%-plus accuracy on her calls, is likewise looking at the natural resource market and gave Vale the thumbs up, saying:
So much value here. I'm hoping that once hedge funds stop blindly selling this name, it catches a significant move up. The fundamentals are so unbelievable it is tough to comprehend why it is down here.
But it's not just metals and energy that are getting attention from CAPS' top members. Socalsy rated Apple an outperformer today and pitched:
I just picked this up in real life. Valuation really depends on your growth assumptions. The stock is priced for 10% annual net profit growth, but I'm more bullish. The analyst concensus is around 24%, which would put the valuation around $190 (where the stock was just a couple of months ago). So even with a more modest assumption, the stock is still undervalued. Plus, I love the products and I think the company's end user focus gives it a wide moat in a competitive industry.
Other All-Star picks today include mollykat's outperform rating on Johnson & Johnson, Phoenix748's positive outlook on Nokia, and FoolMDimasi's nod to eBay. So while there is more than enough pessimism to go around, these CAPS members are looking at the bigger picture and finding good deals in this bloody market.
Have some stock ideas of your own? Why not head over to CAPS and share them with the 115,000 other investors that are already a part of the community?
Matt Koppenheffer is a Top Stocks blogging partner.
