Those who loaded up on gold, oil and other commodities a few years ago in anticipation of raging inflation related to quantitative easing are likely very disappointed. #-ad_banner-#As most investors probably know, commodities have trailed stocks pitifully in recent years. The Dow Jones-UBS Commodity Index (DJ-UBSCI), which tracks a group of 20 commodities, fell 6.5% a year for the past three years, while the S&P 500 gained 17.6% annually during the same period. But one of the nice things about investing is just about everyone gets a chance to be right if they wait long enough… and commodities… Read More

Those who loaded up on gold, oil and other commodities a few years ago in anticipation of raging inflation related to quantitative easing are likely very disappointed. #-ad_banner-#As most investors probably know, commodities have trailed stocks pitifully in recent years. The Dow Jones-UBS Commodity Index (DJ-UBSCI), which tracks a group of 20 commodities, fell 6.5% a year for the past three years, while the S&P 500 gained 17.6% annually during the same period. But one of the nice things about investing is just about everyone gets a chance to be right if they wait long enough… and commodities investors may finally be having their day.  Indeed, commodities appear to be staging a comeback, with the DJ-UBSCI already up more than 7% this year, compared with a 5.6% gain for the S&P. One probable factor in this resurgence: rising consumer prices. According to the latest inflation data (released by the Bureau of Labor Statistics on June 17), the Consumer Price Index (CPI) jumped 0.4% in May — twice the 0.2% increase economists expected. What’s more, May’s 0.3% increase in the core CPI, which excludes food and energy, was the largest since August 2011. With inflation apparently accelerating, investor demand… Read More

Most investors dream of picking that one stock that makes them a fortune.  #-ad_banner-#My guess is those who attempt this typically do so by trying to find the Next Big Thing. That is, they buy stock in a young business doing something that seems new and revolutionary like a novel disease treatment, more intelligent robots, or a unique alternative energy source. So who would have ever predicted one of best stocks of the past half decade or so would belong to a well-known, decades-old firm offering mundane services? When I profiled this stock in October 2012, it was already recovering… Read More

Most investors dream of picking that one stock that makes them a fortune.  #-ad_banner-#My guess is those who attempt this typically do so by trying to find the Next Big Thing. That is, they buy stock in a young business doing something that seems new and revolutionary like a novel disease treatment, more intelligent robots, or a unique alternative energy source. So who would have ever predicted one of best stocks of the past half decade or so would belong to a well-known, decades-old firm offering mundane services? When I profiled this stock in October 2012, it was already recovering strongly from the mauling it took during the financial crisis, having gained 4,370% to $17 a share from a low of $0.38 in late 2008. Now the stock is trading around $57 — 234% higher than when I first covered it and nearly 14,000% above its recession low. Anyone who put $5,000 into this stock back in late 2008 and held on would have close to $700,000 today. The company behind the stock, vehicle rental firm Avis Budget Group (NYSE: CAR), may not be into the Next Big Thing — or it just might be, as I’ll explain… Read More

At the risk of sounding like a broken record, I’ve found that companies you’ve never heard of often make the best investments.  #-ad_banner-#Unlike high-profile names such as Starbucks (Nasdaq: SBUX), Twitter (NYSE: TWTR), Apple (Nasdaq: AAPL), and others, lesser-known stocks tend to sink or swim mainly because of their fundamentals, with hype and speculation playing a much smaller role in their price movements. Frequently, these lesser-known names are in some of the most unglamorous businesses you can imagine. But they’re so good and dominant they almost can’t help but to put up big stock returns. One such company… Read More

At the risk of sounding like a broken record, I’ve found that companies you’ve never heard of often make the best investments.  #-ad_banner-#Unlike high-profile names such as Starbucks (Nasdaq: SBUX), Twitter (NYSE: TWTR), Apple (Nasdaq: AAPL), and others, lesser-known stocks tend to sink or swim mainly because of their fundamentals, with hype and speculation playing a much smaller role in their price movements. Frequently, these lesser-known names are in some of the most unglamorous businesses you can imagine. But they’re so good and dominant they almost can’t help but to put up big stock returns. One such company is a top health care products firm most investors probably don’t know about — even though it’s the world’s largest producer of less expensive but equally effective over-the-counter (OTC) medications sold as store brands. This company’s stock more than quintupled during the past five years, posting a 438% gain that would have turned $2,500 into nearly $14,000. I’m referring to Perrigo Corp. (NYSE: PRGO), a large-growth firm with an $18.6 billion market cap, three-quarters of the store brand OTC drug market and nearly 22,000 OTC products (allergy pills, pain relievers, cough/cold medicines and antacids, to name a few). The OTC… Read More

Although over-the-counter (OTC) stocks are growing in popularity, most investors avoid them because of their reputation for extreme risk. #-ad_banner-#Among the most common dangers of OTC stocks are poor transparency (since the underlying companies don’t have to file with the SEC), the inability to meet minimum financial and other requirements for listing on a major exchange, and increased susceptibility to “pump and dump” scams. What’s more, OTC stocks often display absolutely sickening price volatility. So once an OTC stock gets to where it can uplist to a major exchange like the Nasdaq or NYSE, many investors may get… Read More

Although over-the-counter (OTC) stocks are growing in popularity, most investors avoid them because of their reputation for extreme risk. #-ad_banner-#Among the most common dangers of OTC stocks are poor transparency (since the underlying companies don’t have to file with the SEC), the inability to meet minimum financial and other requirements for listing on a major exchange, and increased susceptibility to “pump and dump” scams. What’s more, OTC stocks often display absolutely sickening price volatility. So once an OTC stock gets to where it can uplist to a major exchange like the Nasdaq or NYSE, many investors may get the impression the stock is now “safe.” And this could be the case with one small stock that’s right in the thick of what may be the Next Big Thing — electronic cigarettes. After trading on the “pink sheets” for years, this tiny e-cigarette maker with a $92 million market capitalization has been trading on the Nasdaq since May 30. Its stock price is up 25% since the uplisting was announced on May 28. So to many investors, the company could be looking more and more like a legitimate and reasonably safe entry point into the emerging e-cigarette industry, especially… Read More

The domestic energy sector has gotten more than it bargained for during the so-called U.S. energy boom — but in a good way if you view it from an economic standpoint.  #-ad_banner-#As part of the sector’s unprecedented success in extracting previously unattainable oil and gas reserves, there’s now a major oversupply of certain useful by-products. These by-products, which include propane, butane, ethane and other liquefied petroleum gases (LPGs), have value in North America, though prices are down due to the oversupply. But LPGs are in high demand and typically command premium prices overseas, especially in Europe and Asia. Read More

The domestic energy sector has gotten more than it bargained for during the so-called U.S. energy boom — but in a good way if you view it from an economic standpoint.  #-ad_banner-#As part of the sector’s unprecedented success in extracting previously unattainable oil and gas reserves, there’s now a major oversupply of certain useful by-products. These by-products, which include propane, butane, ethane and other liquefied petroleum gases (LPGs), have value in North America, though prices are down due to the oversupply. But LPGs are in high demand and typically command premium prices overseas, especially in Europe and Asia. So U.S. LPG exports appear set to keep soaring. Indeed, they could nearly triple by 2020 to almost 800,000 barrels per day from about 280,000 barrels per day in 2013, according to estimates from energy consultancy FACTS Global Energy Group. One company in particular is positioned to capitalize on this trend. It’s by far the leader in LPG transport through the smaller “handysize” tanker ships designed specifically to refrigerate and carry LPGs. The company’s fleet includes 24 such ships, giving it about a 30% market share in terms of the industry’s overall transport capacity, compared with 7% for its nearest… Read More

When considering whether to buy or sell a stock, many investors base their decision heavily on the actions of key insiders such as the CEO, the chairman of the board, and others. After all, who should know more about a firm’s investment merits than those running the company? #-ad_banner-#Blindly following insiders into and out of a stock can be dangerous, though. Like the rest of us, insiders are human. So who’s to say they’ll never make mistakes such as selling in a panic during bad markets or buying on the assumption their company’s stock will simply keep going up? But… Read More

When considering whether to buy or sell a stock, many investors base their decision heavily on the actions of key insiders such as the CEO, the chairman of the board, and others. After all, who should know more about a firm’s investment merits than those running the company? #-ad_banner-#Blindly following insiders into and out of a stock can be dangerous, though. Like the rest of us, insiders are human. So who’s to say they’ll never make mistakes such as selling in a panic during bad markets or buying on the assumption their company’s stock will simply keep going up? But when it comes right down to it, we don’t really know why insiders buy or sell. They don’t have to tell us, only report when they did and how many shares were transacted. So even though it can be informative to know what insiders are doing, they can easily be dead wrong. And they certainly are about one well-known stock, in my opinion. As a group, this company’s key insiders have reduced their ownership of the stock by more than 14% during the past 12 months, according to Morningstar. They now hold a total of about 225,000 shares worth roughly… Read More

In the latest regulatory filing for Icahn Enterprises on May 15, the prominent activist investor Carl Icahn revealed he’d greatly increased an existing stock position during the first quarter. The beefed-up position, now a total of 27.8 million shares worth nearly $1.4 billion, currently occupies nearly 5% of Icahn’s $33 billion portfolio. #-ad_banner-#That’s a bold move for Icahn, best known for acquiring large stakes in major companies and then pressing management for changes he believes are in shareholders’ best interests.  However, it’s uncertain what changes, if any, he plans to push… Read More

In the latest regulatory filing for Icahn Enterprises on May 15, the prominent activist investor Carl Icahn revealed he’d greatly increased an existing stock position during the first quarter. The beefed-up position, now a total of 27.8 million shares worth nearly $1.4 billion, currently occupies nearly 5% of Icahn’s $33 billion portfolio. #-ad_banner-#That’s a bold move for Icahn, best known for acquiring large stakes in major companies and then pressing management for changes he believes are in shareholders’ best interests.  However, it’s uncertain what changes, if any, he plans to push for at this point. After agitating unsuccessfully for months, he seems to have abandoned his ambition of getting eBay (Nasdaq: EBAY) to spin off its best-performing business — the well-known online money transfer service PayPal. Such a move would be an excellent way for eBay to unlock value for shareholders, Icahn has long argued. But even with no obvious agenda, it’s easy to see why he’d want to load up on eBay, despite recent weakness. (During the past 12 months, the company lost $0.11 a share and its stock fell more than 7%, compared with nearly a 15% gain for… Read More

When you think of stocks priced at $1,000 or more, what names come to mind? #-ad_banner-#The well-known online travel company Priceline (Nasdaq: PCLN) (which my colleague Jody Chudley recently profiled), which is currently trading near $1,150?  How about Warren Buffett’s conglomerate, Berkshire Hathaway (NYSE: BRK-A)? Class A shares are going for around $190,000 apiece.  Google (Nasdaq: GOOG) recently topped $1,200 and likely would have kept going if the firm hadn’t split the stock, resulting in two lower-priced share classes. There’s another great thousand-dollar stock every investor should know about, but I’ll bet few have ever heard of it… Read More

When you think of stocks priced at $1,000 or more, what names come to mind? #-ad_banner-#The well-known online travel company Priceline (Nasdaq: PCLN) (which my colleague Jody Chudley recently profiled), which is currently trading near $1,150?  How about Warren Buffett’s conglomerate, Berkshire Hathaway (NYSE: BRK-A)? Class A shares are going for around $190,000 apiece.  Google (Nasdaq: GOOG) recently topped $1,200 and likely would have kept going if the firm hadn’t split the stock, resulting in two lower-priced share classes. There’s another great thousand-dollar stock every investor should know about, but I’ll bet few have ever heard of it — despite a nearly $1,100 price tag and the fact that the underlying company is an industry leader envied by its rivals. It would be wise to learn as much about it as possible, though, because investing in it could just about double your money during the next five years. The company, a highly profitable homebuilder with earnings per share (EPS) of $53.90 and operations in 14 East Coast states and Washington, D.C., mainly builds single-family homes. However, townhouses and condos account for a significant portion (30%) of revenue, which is currently $4.3 billion annually. As analysts at investment… Read More

Even the most dominant companies stumble sometimes, and the highly popular natural and organic foods retailer Whole Foods Market (Nasdaq: WFM) is no exception.  Long the most recognizable name in the health food business, Whole Foods saw its stock plummet nearly 20% on May 6 because it failed to meet analysts’ expectations for the latest quarter. All told, the stock is off about 32% so far this year. This naturally raises the question of whether the pullback presents an uncommon opportunity to invest in a great company while it’s down. I don’t think so. #-ad_banner-#Whole… Read More

Even the most dominant companies stumble sometimes, and the highly popular natural and organic foods retailer Whole Foods Market (Nasdaq: WFM) is no exception.  Long the most recognizable name in the health food business, Whole Foods saw its stock plummet nearly 20% on May 6 because it failed to meet analysts’ expectations for the latest quarter. All told, the stock is off about 32% so far this year. This naturally raises the question of whether the pullback presents an uncommon opportunity to invest in a great company while it’s down. I don’t think so. #-ad_banner-#Whole Foods has been losing ground to the competition for a while, and it’s beginning to affect the company’s performance. In the short term, I suspect its stock may have quite a bit further to fall, and in the long run, I don’t see Whole Foods leading the pack anything like it has in the past. For starters, the company now has two earnings misses in a row. In the most recent quarter, it reported earnings per share (EPS) of $0.38, 7% below the consensus estimate of $0.41. The quarter before that, Whole Foods’ EPS of $0.42 missed the Street’s estimate… Read More

When it comes to investing, I’m a huge fan of “boring.” That is, I appreciate companies with crucial but more obscure products that are so much a part of our daily lives that most people wouldn’t even think of them as investments. Take Packaging Corp. of America (NYSE: PKG), which makes about the most boring things you could ever think of — cardboard boxes and other types of packaging. Yet as I pointed out when I profiled the company in April, its stock has triple-digit upside during the next five years. #-ad_banner-#So does another “boring” stock I’d like… Read More

When it comes to investing, I’m a huge fan of “boring.” That is, I appreciate companies with crucial but more obscure products that are so much a part of our daily lives that most people wouldn’t even think of them as investments. Take Packaging Corp. of America (NYSE: PKG), which makes about the most boring things you could ever think of — cardboard boxes and other types of packaging. Yet as I pointed out when I profiled the company in April, its stock has triple-digit upside during the next five years. #-ad_banner-#So does another “boring” stock I’d like to tell you about. I’ll leave it up to you to decide if the underlying company’s main products, high-efficiency residential and commercial water heaters, are as boring as cardboard. But I think it’s safe to say they don’t spark the imagination the way 3-D printing, wearable computers, mobile banking, e-cigarettes and other emerging products do. Still, the investment potential of this firm, A.O. Smith Corp. (NYSE: AOS), is very exciting. Its stock has generated some outstanding returns already, rising nearly 350% during the past five years. And I think the price could easily double again in the next five years. Read More