"Here are the new year's "14 for 2014" stock picks. These stocks present the best opportunity for total return in the new year."

Dow Jones Industrial Average 16,221 (UP) Week ending 12-20-2014

Good morning everyone. I have put together my list of stocks to start on January 1st 2014 that gives you the best chance for the year for total return. It is a list of very aggressive, (and by that I mean,) "high beta" stock names that are growing the fastest and, in some cases, have already run up substantially in 2013.  What these stocks have in common is that they all have strong balance sheets and good projected earnings growth for 2014.  My thought is that the economy will actually be growing faster this year and that these names should be the best performers.

 At the end of the year, I calculate the return on the basis of buying equal parts of each stock and then calculating the average return. If you read last week's blog, it shows the 2013 return which was 38.716% which is my best return ever. In 2012, my performance was 16.7% which was also very good.



 "3 D Systems Printers"

So here are the picks for 2014:

Stratasys Ltd. - (Symbol SSYS)
Golar LNG - (Symbol GLNG)
Direct TV - (Symbol DTV)
Cree Inc. - (Symbol CREE)
Nike Inc. Cl B - (Symbol NKE)
Holly Frontier - (Symbol HFC)
Yahoo - (Symbol YHOO)
3 D Systems - (Symbol DDD)
Google - (Symbol GOOG)
Hain Celestial - (Symbol HAIN)
Berkshire Hathaway Class B - (Symbol BRK.B)
Arris Group Inc. - (Symbol ARRS)
Polaris Industries - (Symbol PII)
Manitex International - (Symbol MNTX)

I changed this list around 20 times for various reasons but have come up with this final list. 3-D printer stocks, Liquified Natural Gas transport, LED lighting and the two dominant search engines, are a few of the themes that are the glue for the composition of this year's list.

It was difficult to leave some of last year's names off, Celgene, Chipotle Mexican Grill, and Borg Warner who all continue to perform well. But I had to narrow it down to 14 names for the new year.

So let us look ahead to another good year in the stock market. Hopefully, we all make enough money to retire, so that all of the young people out there can have our jobs and be gainfully employed and lower the unemployment rate.

Technology continues to eliminate jobs permanently, especially with the emergence of the Robotics industry, (which Google has exposure to and one of my runner up stocks, Intuitive Surgical (Symbol ISRG), dominates on the medical side.) Other new technology, like Google Glass, continue to create jobs that never existed.

So here is a toast to the new year 2014! May all of your stocks perform well!

Happy New Year!

Freewilly

"The 2013 investing year is coming to a sunset. Let's see how my 13 stocks for 2013 performed. I think that I kicked butt! Easy peasy lemon squeezy"

Dow Jones Industrial Average 15,755.36 (Down) Week ending 12-13-2013

What a year! This was a year where most everything worked.  My only loser pick was Phillip Morris. I guess everybody is moving to those electronic cigarettes.

Celgene was the Adrian Peterson of stocks this year, up 106.54% this year up until Friday.
Facebook, Chipotle Mexican Grill, MasterCard and Borg Warner were the other heavy hitters in 2013. Here is the list in descending order based on success.

Celgene (CELG)                                 106.54%           

Facebook (FB)                                      88.81%
Chipotle Mexican Grill (CMG)           84.71%
MasterCard    (MA)                             62.66%
Borg Warner  (BWA)                          61.83%
Scripps Network (SNI)                        39.57%
Whole Foods Market (WFM)              25.55%
Anheuser-Busch Inbev SA (BUD)      14.74%
DaVita HealthCare Partners (DVA)   12.72%
Diageo Plc  (DEO)                                 4.40%
Petsmart (PETM)                                  4.10%
Ebay Inc. (EBAY)                                 1.04%
Phillip Morris (PM)                             (3.36%)

So my grand total average return for 2013 is:    38.716%


"LEELOO DALLAS MULTI PASS" 

 

I think I won the contest to Fhloston Paradise!

This year, anyone could have been a stock Diva, though. With 13 stocks, that is a pretty darn good average.



Next year, well...now that will be a lot tougher challenge. I am working on that list right now. It will be 14 stocks.

I was a little surprised that the Tobacco and Beverage stocks did so poorly.  In most years, they are stalwarts.


 "Fed Tapering Elf"

Celgene Corp. raising next year's earnings estimates.

MasterCard ended up splitting their stock 10 for 1 and raising their dividend by 83%.

Chipotle Mexican Grill: whenever I go there it is busy and the food is good and reasonably priced.

Scripps Network getting interest from Discovery Communications.

Borg Warner doing lots of international business.

Facebook looks cheap now based on their business growth with Twitter sitting out there trading at the same price and no profits.

Whole Foods Market operationally performing perfectly and expanding at a controlled rate.

All in all a good year.  Below, Wall Street is prepared for the Christmas holiday with the lighted tree.

Remember that the holiday is about giving and thinking about family and friends here now, and those from the past. Surprise someone with your generosity.

Season Greetings and smart stock investing,

Freewilly

"Direct TV (Symbol DTV) is Berkshire Hathaway's 9th largest holding. That is a good enough endorsement for me to add some of this stock to my long term holdings."

Dow Jones Industrial Average  16,086.41 (UP)  Week ending 11-29-2013
Dow Jones Industrial Average  16,020.20 (Down)  Week ending 12-06-2013

Warren Buffett and Berkshire Hathaway's investment team do not make investments lightly. They make a thorough investigation of a company's financial numbers and consistent growth prospects. So when they invest $2.35 Billion dollars or purchase 7% of a company's stock and it is their 9th largest holding, you can bet that someone has done their homework first. Buffett started buying DTV at $42.00 a share and kept buying on the way up. Berkshire just recently lightened their position just slightly.


Direct TV (Symbol DTV, $66.44) is the above mentioned investment which has a one year return of 32.75% and a 3 year total return of 64.70%. We will take those kind of numbers anytime. The PE on the stock is 12.73 and the forward PE is 11.44.

The PEG ratio on the stock is 1.09 and the 12 month trailing PEG ratio is 0.4626, so there is much growth in progress. Direct TV has 12 month trailing revenues of $31.21 Billion dollars.

 DIRECT TV "Genie"

Earnings for 2013 will be $5.00 per share and for 2014 they are projected at $5.79 per share. Year over year quarterly earnings growth is 42.22%.

DTV operates at a Gross Margin% of 47.69%.  The company has a Market Cap of 34.71 Billion, but the company has an Enterprise Value of $52.52 Billion.
The company currently does not pay a dividend.

Again, whatever you do with the Dow Jones at 16,000 plus, you need to buy into these stocks in small parcels and average in.  Do not place any large positions at these levels. Portfolio managers are doing stock rotations in all different directions this month for rebalancing and tax considerations. Be patient for your opportunity to buy.

Best Wishes,

Freewilly

"The search for value brought me to a stock that both Google and Comcast are invested in. Time Warner Cable buyout talk has this media sector heating up"

Dow Jones Industrial Average 16.065 (UP) Week ending 11-22-2013

Arris Group Inc. (Symbol ARRS, $19.89) purchased Motorola Home, a cable and modem box company, from Google this year. 

Arris's website states: ARRIS is a global communications technology company specializing in the design, engineering, and supply of broadband network services for residential and business subscribers around the world. The company gives broadband operators the tools and platforms they need to deliver reliable telephony, demand driven video, next generation advertising and high speed data services."

ARRIS Group Inc., with its headquarters in Suwanee, Georgia, has its stock up 44.78% over the TTM, (Trailing 12 Months).  The stock has moved up from $6.00 per share in 2009 to its current price up near $20 in 2013.

Depending on which stats you look at, the company has a PEG Ratio of between 0.52 and 0.62 and this is what I like best about it.

The company has a Current Ratio of 2.48 to 1. The company Return on Equity is 5.70%, which may be a number in flux because of the Motorola Home purchase.

ARRIS is projecting 2013 earnings per share of $1.56 and for 2014, earnings per share of $1.96 a share. That is a forward PE of only 9.42. The expected earnings growth is 24.3%.

Revenue for the trailing 12 months  is $2.766 billion dollars. 2012 Revenue growth rate was 24.3%. The year to year EBITA growth rate is 133%.

This company has a book value of $9.31 per share. Free cash flow for the company is $4.059 million dollars.

I have thrown out a bunch of numbers here, but the plain English story is that you have a dynamic company here in a growing media segment that is going to earn almost $2.00 per share in 2014 and is only trading at $19.89 per share currently.  That is a good value here with the DOW at 16,000 +. Throw in the fact that Google and Comcast both own some ARRIS shares, and you have a pretty good investment opportunity idea here.

So it's the countdown to Turkey Day, Thanksgiving this Thursday. I got a new coffee maker today. I am ready to eat, drink and watch NFL football this week on Turkey Day.

Gobble, Gobble ,       Freewilly

"With all of the confusion over the Affordable Care Act deployment and a steady rise in employment, a company like ADP should do well in 2014"

Dow Jones Industrial Average 15,962.00 (UP) Week ending 11-15-2013
Dow Jones Industrial Average 15,761.78 (UP) Week ending 11-08-2013

 .... and up and up we go! I got skittish and sold my MasterCard (MA) stock at the nosebleed price of 692.00. It closed on Friday NOV 15th at 752.00 per share. Such is the meddle of this market.

Federal Government liquidity and speculation money combined with very healthy company balance sheets provide a powerful tonic to keep this stock market ascent going.

I tried to stand back and look at this whole Affordable Care Act process and what businesses may benefit from the attempt to organize this whole "collection of the premiums" process for it and how it will all work. I thought of two companies that are experts in this area Automatic Data Processing Inc. (Symbol ADP) and Paychex (symbol PAYX). I decided that for total return, ADP would be a better investment at this time for the next two years.

Automatic Data Processing Inc., (Symbol ADP, $77.33, was $75.21 when I started this article last week,) is in very good position to benefit from these developments.
ADP has just recently increased their dividend by 10% to a 2.5% dividend yield, always a good sign of a healthy company. The company has a 5 year expected PEG ratio of 2.57 and a Return on Equity of 22.27%.

Earnings per share for 2013 is looking like $3.17 per share and for 2014 earnings are projected at $3.50 per share. The company has 0% long term debt and the insider's purchasing looks favorable.

The company did 11.5 Billion in Revenues last year and currently has a Price to Earnings Ratio, (PE) of 21.67.

Automatic Data Processing stock price is up 37.25 percent over the trailing 12 months. (TTM). ADP year over year quarterly growth is  7.70%. Investor's Business Daily EPS rank for ADP is 65, so very favorable.

The stock is fairly valued at this price, so, perhaps, look for a tax time sell-off correction to jump in and pick some up.  Everything looks fairly valued with the Dow at 15.962, but I think this is still a good Total-Return story for you for the next two years.


I like the actual shares of stock on paper with their great lithographs. I don't know if people hold stocks long enough to actually receive the stock certificates, but they are wonderful works of art.


So, I hope you get to keep your health insurance policy and your doctor. It's going to be fun getting this thing all working right.  I hope the people that actually needed the help getting insurance are served by this ACA plan.

Peace,  Freewilly

"Enough of the gloom and doom. Let's have some fun with this recreational vehicle company that has been pinning the needle for months. Polaris Industries"

Dow Jones Industrial Average 15,615.55 (UP)  Week ending 11-01-2013

             Polaris Industries (Symbol PII)

This is Blog #200 today, so a small personal milestone for me on Freewilly's Stockpicker Blog. I am much better at picking winning stocks now than I was in my early years of blogging.

Two of my defined stock picking screening criteria that have emerged over the years are: I love stocks of companies that have PEG ratio's under 1.5 and also that have a Return on Equity above 15%.  I have found these stocks to be very dynamic and have produced very good stock returns.

Polaris Industries Inc. (Symbol PII, $131.09) is a prime example of one of the stocks that fit these criteria perfectly. Polaris has a PEG of 1.093, well below my 1.5 criteria, and an amazing Return on Equity of 46.68%.  The stock chart and price have been on a straight line and going up for months.

Polaris Industries is an American manufacturer that designs, engineers and manufactures off road vehicles and on road vehicles.  Its products include side by side vehicles, terrain vehicles, victory motorcycles, Indian motorcycles, snowmobiles, GEM electric apparel accessories and polaris defense.  Polaris is based near Minneapolis in Medina, Minnesota, USA.  The company did $3.594 Billion on sales last year.

Polaris is projecting earnings per share for 2013 of $5.37 and is looking like $6.44 per share for 2014.

The stock of PII is up 52.71% YTD.  Analysts have 9 buy and 2 Overweight recommendations on the stock.

The company pays an annual 1.28% Dividend. The forward PE on the stock is 19 with year over year quarterly growth of 19.55%.





I know the stock market is at all time highs, so you may need to be patient to find a spot to buy in on this one.

The description below is from Polaris's website.

"Polaris Creed"

At Polaris, making great products is not just a job - it is a way of life. That is why our creed is etched in steel at the entrance at each of our locations. Our employees are not only building and designing our machines, they are also enthusiastic riders. This gives us the competitive edge as we work together to make the riding experience better."

I really like this pick. A perfect growth stock for a diversified IRA Portfolio.


Talk to you next weekend,  (or as always, I invite you to comment during the week, even if just to let me know you are reading. All questions will be answered. This site is for the novice and expert investors. The only money I make off of this site is by following my own investment advice and using the good ideas of other investors that I sometimes bring to light on this site. )

Freewilly

"Time to be wary with the government continuing to run up its debt tab. But there are still good values out there to invest in. We still have another quarter of good upside movement in the market."

Dow Jones Industrial Average 15,570  (UP) week ending 10-25-2013

 Fiver - Could see the future in Watership Down

Many of you have read Richard Adam's classic novel Watership Down and remember Fiver, the rabbit who was a prophesier of the future. In the picture to the left, Fiver sees blood in the field and was scared because he sees the coming destruction of the warren. Well, that is kind of how I feel right now with the government not reducing any spending at all when pressed to do so. Add on top of that the Affordable Care Act law, which I believe will add another 3-4 Trillion dollars to our overall national debt. A scary view out into our future.

In the short term, full steam ahead, but sometime in 2014, we could run into a very ugly situation with a downgrade of  US credit rating and a rise in interest rates. So keep your eyes wide open here and if it starts to look dicey,  start getting some of your assets to the sidelines.

Manitex International, (Symbol MNTX, $13.87), is the kind of stock you may want to look at going into this type of period. It runs below the current of the mainstream market. The stock was mentioned in Zacks Investment Ideas as a "best Value Play" and was also mentioned on Forbes List of America's best Small Companies.


Manitex International, Inc. is a leading provider of engineered lifting solutions including cranes, reach stackers and associated container handling equipment, rough terrain forklifts, indoor electric forklifts and special mission oriented vehicles, including parts support.


MNTX stock is up 53% this year and the One year change in the stock is up 107.95%. Numbers vary depending to what site you go to. PEG ratio 0.83 on one site and 0.2375 on another. Either way, cheap compared to growth. Return on Equity is 13.60 %. This small cap stock did Revenues of $232 Million. Revenue growth has been 50% and the expected revenue growth is 20%.

1 year earnings growth has been 40% with ongoing earnings growth at 27.3%. The forward PE on the stock is 11.80. The IBD rating on the stock is 98-91-91. If you read Investor's Business Daily you know what that means. If not, you need to spend a couple bucks and buy a copy!

The 2013 earnings per share estimate is $0.86 and the 2014 earnings per share is projected at $1.20.

So, let's see how this 4th quarter rolls out and be prepared to go into a very defensive mode if the "Drunken Sailor" spending and the Fed "Non Tapering" continues down there in Washington DC. Somebody in Congress needs to step up and make a stand.

Feel free to comment your opinion on my blog.

See you next week ,   
         Freewilly


.

"Time to look ahead to 2014 and see what sectors are looking favorable. One area is Steel, and Steel Dynamics, Inc (STDL) is one company with a favorable earnings outlook"

Dow Jones Industrial Average 15,23711 (Up) Week ending 10-11-2013
Dow Jones Industrial Average  15,399.65 (Up) Week ending 10-18-2013

It sure feels like a blow-off top at the end of this week in the Momentum stocks. Google, Chipotle Mexican Grill and Amazon just exploded to the upside. But I think we are very close to a top in these Netflix and PriceLine.com type momentum stocks and folks should start locking in some profits on these names. Don't get sucked in and be buying them here!

Looking ahead to 2014, it appears that Steel will be one good area to deploy some capital.

Steel Dynamics, Inc. (Symbol STLD, $18.09) appears to be an aggressive way to play this now for 2014.  The company has been no slouch this year being up 39.15% in stock price year to date.  The PEG ratio on the company is 0.83 (according to Yahoo Finance) and the Return on Equity is a low 5.08 but improving next year. The company is paying a 2.43% dividend currently and this is expected to rise also to 2.60% dividend in the future.



STLD has a Current Ratio of 2.58,  so they are very financially stable. The Book Value on the shares is $11.10, so this seems like a pretty good value at $18.00. Operational Cash flow is $386 Million dollars for the trailing 12 months. (TTM).


Steel Dynamics, Inc. is projecting earnings per share of $0.85 for 2013 and for 2014 earnings per share look like $1.46 per share, a big rise, and one which would have the stock sitting at a PE of 12 at the current. Insiders for the last 6 Months have been doing nothing but purchasing.



And guess what? They employ a lot of people in Plants around the USA. Gotta like that!

The Company does between $7-8 Billion a year , so it is a good solid MID-Cap stock for your portfolio.

Freewilly is a big advocate for diversification between Small Cap,  Mid Cap and Large Cap stocks in your portfolio.

Too many people's portfolios are lopsided towards owning too many Large Cap stocks.

The idea here is to start preparing for your 2014 portfolio. Unload the stock ideas that have failed this year and take profits on some of your Momentum stock superstars to offset.

Sullivan County, PA,  near Laporte

Enjoy your Autumn weekend,

Freewilly

"Can't ever get enough of those Television Broadcasting stocks. Here is another one to add to your list: Nexstar Broadcasting Group Inc., NXST"

Dow Jones Industrial Average  14,994.68  (Way Down) Week ending 09-27-2013
Dow Jones Industrial Average  15,072.58  (Up)   Week ending 10-04-2013

I have loved the Broadcasting and Media stocks going all the way back to Paramount Pictures and Gulf and Western.  CBS Corp., Disney/ABC, Scripps Network, AMC Networks, Time Warner, Comcast/NBC,  LionsGate and the list of winners goes on this year.



Alexander Eule over at Barron's in his September 21st article brought this next stock to light.

Nexstar Broadcasting Group Class A., (Symbol NXST, $44.95) is the next name to add to the successful group above. Eule mentioned Nexstar and some other stocks in regards to the broadcast spectrum licenses and spectrum that they own that could be worth as much as the whole current given value of the company.

Nexstar Broadcasting, based out of Irving Texas, has a PEG ratio of 0.0041. The stock has a year to date return of 324% and is trading near its high for the year of 45.42.

There are only 30 Million shares outstanding of the stock and the company has a market cap of 1.35 Billion currently, so this is a baby Mid-Cap stock.

The company with its local TV stations across small markets around the country should benefit due to the AD market recovery and should also get a windfall from all of the political ad spending and ObamaCare advertising.

The stock trades at a low PE ratio of 7.9 and does pay a dividend equal to 1.07%. The company current ratio is 2.658 to 1.

The Big news is that earnings for 2013 are projected
at $1.05 for 2013, but then rocket up to $3.57 per share in 2014, a huge rise in earnings. The company also is a digital company that creates websites with community interaction.

The big kicker to the stock, though, is the value of the broadcast spectrum that Eule mentioned in his Barron's article, so you can buy this one and sit on it a while.

Sometimes, you just have to admit that somebody else has a great idea and just go with it.

Lou Rukeyser would happily go along with that line of thinking.

Always good to see you, Lou!  I wonder what you would say about this government circus show.

Freewilly

"What to make of the Fed continuing to buy $85 Billion of treasury bills at every bond auction? I would say: don't go out on any limbs with your stock investments and sell one or two of your high PE stocks, just to prepare for a wicked financial hangover"

Dow Jones Industrial Average 15,451 (UP) Week ending 09-20-2013

Funny Money. "Billionaire investor Warren Buffett compared the U.S. Federal Reserve to a hedge fund, because of the central bank’s ability to profit from bond purchases while accumulating a balance sheet of more than 3 Trillion dollars." Here is a link about it. Buffett lectures at Georgetown University in Washington DC. -Bloomberg .

Chris Prybal, a Quantitative Analyst at SchaeffersResearch.com, says, "Based upon statistics from the New York Stock Exchange (NYSE), Margin Debt is approaching all-time high levels."  Here is the link to  Prybal's report on Margin debt on the NYSE

Funny Money. What does this all mean? It means people and the government are all leveraging to purchase investments.

How does this usually and always turn out? Bad, is the one word that comes to mind.

What should you do to respond?  If you own some high PE stocks, (25+ PE), that pay little or no dividend, you should review what you have and in the next month take one or two of them to the sidelines and lock in your profit.

On the flip side, I would, for the time being, only buy things that are pretty sure and steady stocks. One of those stocks is:

Express Scripts Holding Corp. (Symbol ESRX, $62.05)

is, according to CBS Marketwatch, "a holding company that operates through its two wholly owned subsidiaries, Express Scripts, Inc. and Medco Health Solutions, Inc.  The company provides pharmacy benefit management services and clinics healthcare account administration services in North America."  

One thing you can be sure of is that people are still going to take their medicine everyday, whether or not Ben Bernanke or Janet Yellen decide to "taper"  the amount of bonds the FED is going to be buying.

ESRX is projecting 2013 earnings of $4.31 per share, (PE of 14.59), and 2014 earnings of $4.94 (PE of 12.71) on the current price. Express Scripts has a PEG Ratio of 1.01 and a Return on Equity of 10.37.

Revenues for the company in 2012 was $93.86 Billion. The company has 5 year EPS growth of 24.95%.

Express Scripts has very strong Institutional support with companies like Vanguard, State Street, BlackRock, Janus and Fidelity being very large holders of the stock.

So the Freewilly final word is to be careful here in the next 3 months and just own mostly stocks that could weather a financial storm. Also, lower the average PE of your stock portfolio overall as a safety hedge.

Freewilly