Welcome to the weekend after the worst week I can ever remember seeing in the stock market. I can’t do much to make you feel better about that, but I can give you a chance at $50 or $100 if you’ve got time to share an idea with the rest of us.
Famous investors of yore have shared lots of thought about what to do in these times, and most of them revolve around buying when everyone else is selling. Rothschild suggested that we buy when there’s blood in the streets, Buffett tells us to be greedy when others are fearful.
Well, today I wouldn’t be surprised to see at least a pinkish tinge to the sidewalks … and judging from my correspondence, people are as fearful now as they were after September 11, 2001 (for different reasons, of course). Who knows if it’s the bottom, but there certainly aren’t many enthusiastic buyers.
This market crash could hardly have come at a worse time — millions of Baby Boomers are hoping to retire over the next 10 years, and for those who were trying to goose their returns with a bit too much stock exposure those dreams of life on the road in a Winnebago may be pushed back a bit.
But if you’re like me, you can’t help but feel that in all this pain there may lie a bit of opportunity. And we know that in the short term, the market makes lots of mistakes as it rides emotional waves of fear and greed … so where does the opportunity lie?
Heck, maybe all our fear is misplaced and the fact that the Dow turned around late on Friday to move up 1,000 points or so (from intraday lows to intraday highs, at least) means we’re all fine, the last seller has left the building, and we’ll all be rich. No?
Now’s your chance to be the next Rockefeller or Buffett, though your rewards will be quite a bit more limited than theirs. I’m asking you to suggest a stock or other investment that you are tempted to buy right now, whether or not you can bring yourself to actually do so.
And I’ll award $50 each to two submissions — one whose idea sounds most interesting to me or is best presented, and the other to the person who suggests the stock that does best between now and election day. That’s only three weeks, so it’s a crazy time frame, but if I wait much longer I’ll forget to keep track. You can still come back and take some bragging rights if you make a good longer-term call.
And yes, the same person can win both if that’s how it works out. So you might just win a hundred bucks if you’ve got the magic October touch.
One catch: I’ll only reward the money if at least 20 people submit ideas.
The rules:
- You can submit only one idea, unless you fool me by using two different email addresses or accounts. Enter your idea in the comment form below.
- Submission deadline is Monday morning, before the stock market opens in NY. If you believe you’ll get great insight from the Asian markets on Sunday night, or the premarket Monday morning, feel free to wait until the last minute — 9:30 EST is the deadline Monday morning.
- If two of you have the same idea, the first one submitted gets credit.
- The Stock Gumshoe short ban is in effect — these have to be long positions in either exchange-traded debt or equity. You can choose an ETF or closed end fund if you like, but not a short or ultrashort ETF, or a short position in anything. And no, there’s no ticker for “coffee can in the backyard,” though I suppose you could pick the GLD ETF if you like.
- You can submit just a stock ticker if you want, but if you’d like to explain yourself please keep it fairly brief — no more than a couple paragraphs. You’ll have to explain yourself for a chance at the first $50.
I know that many of you wouldn’t part with your money right now no matter what, even if it was Mother Theresa at the door trying to sell you a bar of gold for a dollar, but I know most of you have at least a little temptation — who thought that GE would be in the teens? Or that Microsoft would trade at a single digit PE and have a dividend yield that’s actually worth looking at? And who knows, is something going to happen this weekend that changes everything?
So … what’s your stock market temptation?
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NYX-8.2 pe,4.2 Div, with a peg of .40. Down approx 70% from high, what more could you ask for.
BHI, having dropped from 90 in July to the low 30’s as of Friday. Revenues and earnings both growing, buying back shares, pays a safe dividend, and has about twice as much cash as short term debt.
PCR, price 17 after hitting a low under 15, no debt,forward pe of 4.4 $15 of cash/share,enterprise value of .02.
Warning! Stock picking contests are NOT investments. They are for stocks that folks think will go up BIG TIME. Along with that comes RISK. So here it is:
IOC
This risky stock has been trashed along with everything else. They Drill for Gas in Papua New Guinea. They do upstream, refining, LNG, and downstream. Pre-Announced yesterday. Will it pop in 3 weeks? DK!
PWE (&/or AVV) – Prime West Energy Trust and/or Advantage Energy Trust. Two Canadian oil and gas trusts with good fundamentals, paying off debt instead of increasing dividends during boom time. Panic selling lowering prices to where they probably were when oil was $18/bl whose dividends as a result are now above 20% – eligible as qualified dividends, with the 15% Canadian tax retrieveable using US foreign tax credit form. Hey – where else can you get 25% dividend?
PAYX, dividend above 4, no debt, plenty of cash on hand. Strong earnings. Very good time to be bullish on this company.
AUY
Who knows if it will work. It’s complete guess work with this market.
BRK.B…
why not tap into a sure winner at a bargin price ?
berkshire is a very great buy right now, if a bit on the pricey side) and over ten years has had stellar returns and gains in share value…the stock spreads its investments across a broad segment of the market and is definitely vested in technologies for the future..safe and sane ain’t bad !!!
AVP – Avon Products
During bad times nothing like a small expenditure to make one feel better. Strong base of loyal customers. Baby-boomers. Dividend. Lower priced cosmetics.
Nobody has mentioned Canadian Royalty Trusts. The largest is Penn West Energy Trust (PWE) and is trading as of Friday’s close at a yield of 24%. I believe this distribution will remain stable and is paid monthly.
I would suggest stock purchase of Campbell Soup CBP as a long term buy.
BTU – Peabody Energy, way down from its high of $88, now $28. The price of coal is still high. I know about deflation and all, but this “black gold” is a necessity for more and more utilities overseas. Demand is still way up, and so will the price be too. The devaluation of the dollar will probably help too. PE of 14, future PE of 4. Practically a limitless supply of a necessary commodity with an lengthly expensive startup cost.
My nomination would be BUD. InBev has announced it will buy BUD for $70/share. They announced this before the financial markets fell apart, but the deal is still going through. Now BUD sells for less than $60, so if the deal happens, it is good for more than $10/share. InBev says it will sell warrents to finance part of the deal. If you think this has merit, you buy BUD which, by the way, is still having a good year.
I’ve been increasing my position in XLF since the bloodletting began. If I could afford it, I’d buy more on the theory that if the financial sector doesn’t ever rebound, we’re all in the crapper anyhow. (I’m such a small-timer that anyone can safely ignore my advice.)
Larry, is that you , you 220+ bowler hustler, my fav dude in high school?
GRMN – Low Debt. Good Cash Flow. Current Ratio of 3.14. They have their eye on the future. Why is this stock going down? I am buying up as many shares as I can afford. I’ll pat myself on the back 10 years from now.
FRO here also–price has come down from ~70 to as low as the high 20’s (sob–by not waiting an extra hour, I paid high 30’s instead of low 30’s for most of my current position), and the dividend, should it continue more or less as it has, is drool-worthy. I am thinking more long-term with this.
Maybe a gun and a mask is the answer. If you get away with it you have your nestegg. If you get caught, your retirement worries are over!
FXI
No way an entire country is worth 70% less than it was a year ago. They have trillions of dollars hoarded for a rainy day. They own trillions in USA govmint treasuries to use as political leverage. (Lord, please don’t let them cash them in.) They kill their crooks and liars. They have cheap labor. They have no Democrats advocating for tax and spend freebies in order to buy votes. They have a monolithic central committee that controls all rather than the octopi like governing structure that we are watching flail away. They don’t have CNBC polluting their minds. They don’t have ideologues critiquing their every move. While we have peaked, they are just getting started. They don’t mind playing dirty and being chummy with scum if it serves their interest. They have a unified population that has tasted the good life and will never go back to an agrarian, 3rd world way of life. They’re what we were from 1880 to 1928.
GERN
Mccain or Obama both will improve the outlook here.
GM – pre-bankruptcy sale?
** Auto industry icon, not only in the US but the world.
** Pool of skilled/experienced engineering talent.
** Savvy buyers waiting in the sidelines – Jap/China auto company; private equity.
** Buyer of last resort – US Govt?