02/20/2004 12:00 am EST
One of the most exciting events at each Money Show is the InvestorPlace Panel, presented by Phillips Publishing. Hosted by Gary Alexander, the panel features some of the nation's best stock pickers--Louis Navellier, Mike Murphy, Toby Smith, and John Mugarian.
(For more information on each of these advisors, please click on their photos.)
"It's a much more mature market and we find investors gravitating more towards fundamentally superior stocks," says Louis Navellier, editor of Blue Chip Growth Letter and MPT Review. "As a result, our latest picks are pretty conservative. I like Zimmer Holdings (ZMH NYSE), which is in the orthopedics business. They make new hips and knees and body parts. In the energy business, we're ecstatic with Occidental Petroleum (OXY NYSE). This is a very good growth company that predominantly operates internationally and may get some new growth out of Libya. Occidental is quite an amazing company. It also has a 2.4% dividend. In addition, I like Huaneng Power (HNP NYSE). This is a good way to play the boom in China. In the third world, power is less consistent and demand is growing rapidly. These three stocks are very recession resistant and will do well over a longer period of time. They should all have steady earnings growth no matter what type of economic environment we are in."
"I like SBC Communications (SBC NYSE), the second largest telephone provider in the US, with 57 million phone lines in 13 states," says John Mugarian, editor of the recently launched Investor Alert. "With its Cingular service, they are aggressively expanding their wireless business. Cell phone use is growing at 10% annually, while PDA, laptops, pagers, etc. are growing at 35% a year. SBC signed an agreement with AOL for instant messaging and has an agreement with Yahoo for their DSL business. SBC also announced a staggering 10% buyback, or 350 million shares. That's huge. SBC has 4.7% yield, they're raising the dividend and buying back stock. If you wait ten years, you'll be amply rewarded. That's my #1 pick." (Following the panel, SBC announced the purchase of AT&T Wireless, making it the nation's largest wireless company. John says, "This adds to my coviction that major telecom like SBC will dominate wireless in the years to come.")
"One of our favorite areas for investors is flat-screen high-definition TVs," says Toby Smith, editor of ChangeWave Investing. "This wave is huge. It is going to grow at 40% to 50% for the next four to five years. We like AU Optronics (AUO NYSE), which is probably the most undervalued tech stocks around. They make the screens and sell them to everybody else. AU is the second largest screen maker in Taiwan. We believe the secular growth for the company will be the 28% to 35% range, yet it's selling at eight times its 2004 earnings. Another stock we love is Silicon Precision (SPIL NASDAQ), which is also a company that is in the business of making chips. They have a big position in selling chips to the flat-TV screen makers. They also own a large position in another one of our favorite stocks, ChipMOS (IMOS NASDAQ), which provides testing and assembly services for LCD and other flat-panel display driver semiconductors."
"What will be the next really big thing in technology?," asks Mike Murphy, editor of Technology Investing. "We don't know. When the mainframe computer business ended, nobody predicted the personal computer. When the PC business fell apart, nobody predicted the Internet. And I bet if we get together in six or seven years, we'll say, 'Boy, nobody guessed that 'X' would be the big push.' Meanwhile, here are some we like now: Lexar Media (LEXR NASDAQ) makes the little digital flash cards used in cameras. These cards can also be used in MP3 players, PDAs, and make a nice substitute for a disk drive in a lot of portable devices. Investors are paying 22 times earnings for 27% growth. The stock has come down recently and I think it's a real opportunity. Taiwan Semiconductor (TSM NYSE) is the number one company in the world for manufacturing semiconductors. They are 99% sold out on their most advanced product lines. Their products are involved in all of the things that people are talking about in the communications sector. The stock is under our buy limit of $12. TSM has been weak, mostly because the Taiwan government is going to sell a block of stock. Once this is done, we think the stock will be on its way."