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Top 5 Stocks for 2009
As we enter 2009, and leave the carnage that was 2008 behind us, I recently wrote that now was a fantastic time to buy shares of companies you have been watching and where the fundamentals present an excellent risk/reward scenario.
A fresh start to the new year gives us all a chance to catch our breath and reexamine the allocation of our portfolios.
Particularly of interest to me and readers of this blog, are what stocks we should be purchasing for the riskiest portion of our portfolio.
Namely, that devoted to small and micro-cap stocks that I specialize in.
In this report, I will be outlining 5 great stocks for the new year from highest to lowest allocation, and explaining my reasons for liking that company, as well as the biggest risk factors when it comes to investing in that stock.
I’ll also outline at what price I feel these stocks are great values and when you should buy more, or hold off untill a better price comes along.
Finally, I will detail the % of your portfolio specifically set aside for risky stocks, that you should be investing in these companies.
For instance, if you only have $5,000 to invest after maxing out RIA, 401(k) or other retirement savings accounts, etc., how much of your “play” money should be put towards each of these names.
Remember that these selections are only current as of right now, and aren’t all formal recommendations on my site.
For updates on my current model portfolio and the companies recommended in this report, please check back with PeakStocks.com.
OK, enough talk, let’s get right to it!
Why Is Everyone Hating On Rick’s? Is It Time To Buy?
There is a definite slowdown in Rick’s Cabaret International’s (NASDAQ: RICK) business as a result of the overall market forces and economic malaise, but all things being equal, the company still reported fantastic numbers for 2008, but failed to give forward guidance as a result of the down economy finally peeking its head at the company’s strip clubs.
As I wrote about previously, I wanted to see Rick’s results come in where they said they would (they did for the most part), and show continued execution on the cash flow and free cash flow side of the business (which they also did). Finally, I was looking for Rick’s forward guidance to be cautious with respect to the headwinds that they are facing, and that also came to pass.
In fact, Rick’s failed to give forward guidance based on the precipitous slowdown in their business within the last month.
So what does this mean for our investment? Is Rick’s still a good place to put new money to work? Is the business flawed or coming under pressure that would prevent the company from continuing as an ongoing concern? What about Rick’s cash reserves and liquidity?
In this post I’ll be breaking down Rick’s full earnings release, as well as their analyst conference call, and round out my post with what you should do with Rick’s stock.
Buy Alert: It’s Time To Lock Up Shares of GeoEye Immediately!
It’s time to start a large position in GeoEye Inc. (NASDAQ: GEOY), or add to your position if it is less than 3/4 immediately.
The provider of space based and aerial imagery is trading at a huge discount right now to its true value, and it won’t be long before the market realizes this (as has already started happening once GeoEye bounced off of its lows last week).
In addition, with upcoming catalysts, and insider buying, now is not the time to delay.
I would even advocate buying long term call options for those that are familiar with that strategy as within 3-6 months, GeoEye’s shares will be much higher than they are now.
In this post I’ll detail the reasons why.
This is a must read as we enter 2009 for those looking for somewhere risky, yet calculated, to put their money.
Rick’s: Still Entertaining or Ready to Slide?
The economy might be going down the proverbial toilet, and consumer stocks on most people’s radars are getting crushed, but one industry that is bucking the trend, at least up till now, is the adult entertainment industry.
I guess something about the escapism that a beautiful woman provides to those in times of stress has led PeakStocks.com portfolio recommendation Rick’s Cabaret (NASDAQ: RICK) to report pretty amazing results, despite all the turmoil going on today.
Rick’s will be posting their Q4 and full year 2008 earnings and hosting their analyst conference call after the market closes on December 29th.
But because their stock was getting hammered along with the rest of the market, and small and micro cap stocks in particular, Rick’s took the unusual step a few weeks back of preannouncing their latest results to sooth Wall Street’s concerns over the rapid deterioration of the nation’s economy.
Aside from a brief pop in the stock, it hasn’t seemed to help.
In this post I’ll go over the important aspects that we need to be aware of before Rick’s announces earnings and then break them down into the following parameters:
- What went right in the quarter: What were some of the positive developments that occurred within the company in the last 3 months.
- What went wrong in the quarter: What were some of the negative developments that occurred within the company in the last 3 months.
- What I want to see: All things considered, what I realistically want to see from the company as it relates to their business.
- What we need to see: At the minimum, what we need to see for our investing thesis to still hold and an investment in this company to be prudent.
- What we’ll probably see: After weighing what’s been going on for the last 3 months, what we can realistically expect when they do announce their earnings.
- Bottom Line: What it all means, and what you should do.
AAR Corp. Earnings Moderate, Outlook Slows
There is a definite slowdown in AAR Corp’s. (NYSE: AIR) business as a result of the overall market forces and economic malaise, but all things being equal, the company still reported decent numbers after the market closed last night.
As I wrote about previously, I wanted to see AAR’s results come in somewhat in-line, which they did, but see significant improvement in their cash flow generation and paying down some of their debt load, which did occur.
So what does this mean for our investment? Is AAR still a good place to park our money even in the face of the continued economic storm?
In this post I’ll be breaking down AAR’s full earnings release, as well as their analyst conference call, and round out my post with what you should do with AAR’s stock.
Get Gold for Nothing!
Every now and then I like to give guest authors a chance to share their views either on the stocks that I already cover, or names that I don’t, but that I feel would benefit my readers. Some of these author’s viewpoints agree with mine, and some don’t.
I feel that the more information you have about a particular company, stock or the market in general, the better decisions you can make regarding your investments and what actions you should take in regards to those investments.
Today’s guest author is Glen Bradford, he runs his own blog, GlenBradford.com.
Glen is an MBA at Purdue University that’s investing his entire college tuition in the stock market.
He writes for seekingalpha.com and stockpickr.com and I like his approach to investing and feel that it gives us another angle when looking for new places to park our money.
Glen will be presenting his investing thesis on a company called Gold Horse International (NASDAQ: GHII.OB).
Please note that this is not a formal recommendation, just an information piece designed to allow you access to companies that I might never cover, but that are worth a look for your portfolio.
News Bites for Thursday December 11th: GeoEye Wins Large Contract, AAR Earnings Preview
I wanted to update you on 2 of the companies in the PeakStocks.com portfolio that have had developments in the last few days that you should be aware of.
This includes:
- GeoEye Inc. (NASDAQ: GEOY), which announced on Wednesday December 10th after the market closed that they have secured a very important Service Level Agreement (SLA) with the National Geospatial-Intelligence Agency (NGA) and
- AAR, Corp. (NYSE: AIR), which is set to release their Q2/2009 earnings early next week.
Let’s get right to it.
uWink DOWNGRADE to HOLD - Stock Tender Offer Dimishes Possible ROI
On Friday December 5th, 2008, uWink (NASDAQ: UWKI.OB) made an “odd lot” tender offer to purchase all shares of its common stock held by persons owning 99 shares or fewer on the close of business as of December 1, 2008. The offer is valid until 5:00 p.m. Eastern Time on Thursday, January 15, 2009.
This offer is designed to reduce the number of total shareholders of uWink’s stock to under 500, whereby uWink would then deregister their stock from the OTC/Bulletin board and spin off their technology licensing business as a dividend to existing stockholders.
As I just wrote about last week, uWink has serious liquidity issues and is taking an unprecedented step to take themselves out of the stock market, and make the company look more attractive for possible investment for the two separate entities that they will become: one a restaurant company, and one a software and licensing company.
As a result of this tender offer and the uncertainty surrounding the company and our investment, I am downgrading uWink to a HOLD. I’ll break down my reasons within this post and explain in more detail what exactly is going on.
Top 5 Stocks for December 2008
WOO-DOGGY!
Would you like some volatility to go along with your morning coffee?
Since I last came out with my top 5 stocks for November, the market’s gyrations have certainly put everyone on edge, and make buying stocks at this juncture definitely not for the faint of heart, or those with very short term investing time frames.
I recently wrote that now was a fantastic time to buy shares of companies you have been watching and where the fundamentals present an excellent risk/reward scenario.
My watch list is no different, and this month I have a broad range of stocks that I am looking at for possible inclusion into the PeakStocks.com portfolio.
These stocks enter and exit my Top 5 as constant fluctuations in both price, market conditions, and business fundamentals constantly alter the investment thesis.
Please note that my Top 5 Stocks for December aren’t yet formal recommendations.
I have more due diligence that I have to perform on them, but they are compelling enough with the research that I have done to be at the absolute top of my list, at least as of this writing.
Will uWink Survive?
It’s been a recurring theme with the large scale selling in the market but uWink (NASDAQ: UWKI.OB) in particular, as those that own these stocks panic and try to make sense of their investments.
We’re at that juncture where it’s time to once again check in on uWink and their latest quarterly earnings release (or rather the 10-Q), and what this means for our investment going forward.
One thing is certain: the economy has hit uWink’s restaurants hard, and while I’ve written countless times how uWink is not a restaurant company, but rather a software development company, we are now at a critical juncture in the company’s genesis in that with the stock price where it is, and uWink’s cash burn rate, something will need to happen one way or another rather quickly.
uWink’s shares aren’t for the faint of heart, but for those interested in uWink’s Q3/2008 results, as well as in where uWink is headed and what progress is being made on getting their terminals inside more restaurant chains and other hospitality venues, read on.
