This is year nine of my end of year exercise to identify what I believe are my top 10 holdings for the coming year. These are the 10 stocks that I already have in my portfolio, that for one reason or another I feel have the best chance of doing well in the next year or so. These are all, of course, only my opinion, and I'd hate for anyone to invest in these, lose their money and blame me. So don't even think of investing in these without doing your own research. Targets are my naive idea of what I think is fair value for each of these. Some turnover this year (not unexpected given 2009’s excellent returns) and a change in focus from retail to Pharma and Biotech. In fact, this may be my most focused New year’s list. This is more from a change in my perception of value than a change in strategy. Once healthcare reform is resolved, there will be less uncertainty and better visibility in the healthcare area, which I think should be positive either way. In general, this years stocks have trailing P/Es of 15 or lower and dividend yields of 2-6%, with a couple of exceptions.1) MRK – Pharma underperformed in 2009 and MRK has just about the best fundamentals of the Pharmas that I hold. P/E in low teens and around a 4% yield. I’ve held Merck for several years and it has been on my list before. My target price is around $60.2) AMGN - Amgen is a new holding. Fundamentally sound in a currently underperforming sector. Highest sales and among the lowest p/e of any in the Biotech sector. Target $100.3) BMY - Bristol Myers is another long-term holding which is still cheap and paying a good dividend. Target $40.4) BBOX - Black Box moves up another notch and is my first repeat from last year. Still looks good fundamentally and in good shape financially. A Tech stock for a little diversification. Target reduced to $50.5) PG - Proctor and Gamble has been on my watch list for several years and finally looked attractive enough to buy this year. A pretty safe large-cap. Target of $100.6) JNJ - Johnson and Johnson is another ultra-safe large-cap healthcare stock that I’ve held for several years. It is well diversified within the healthcare sector. Good P/E and dividend. Target of $95.7) PFE - Pfizer moves down my list to number 7. Good (but reduced) dividend yield and reasonable earnings. Pipeline concerns are already baked into the price and the Wyeth acquisition may help alleviate some of that. Target reduced to $30.8) MDT - Medtronic repeats on the list. Had a good, but not great year in stock appreciation. Continues the healthcare theme in medical devices. Target remains at $70.9) BKS - Barnes and Noble repeats, having given back a lot of the gains from earlier in the year. Earnings are down a bit, but the dividend is still attractive and I expect earnings to eventually recover. Target reduced to $30.10) T - AT&T has appeared on my list before, but absent last year. Another low p/e; high yield pick. Adds a little diversification by virtue of not being a healthcare stock. Target of $35.Gone from last year's list are JAS, SCHL, LTD, MSFT, DIS, and AMAT. I continue to hold them all, but in somewhat smaller amounts.
What no railroads? Warren Buffett likes BNI. I like KSU.
No, I don't own any railroads. Maybe I should, but not likely to happen anytime soon. In the last few months I have added PG, AMGN & DRI and probably won't be looking to add any more positions, unless I get rid of something else. Around 20 stocks is about all I care to follow and I'm at 21 now. DRI was added since the first of the year and likely would have made my list had I already owned it. Need to add the remainder of my 2010 roth contributions so that I can bring some positions up to the size I want. Would like to add some more shares of DRI, PFE and maybe a little more AMGN.
My picks for 2010 are KO,BP,MCF,GMCR,EBIX and NUEFor Nue it will depend on wether steel production improves this year.
Not a good year for these stocks, relatively speaking. One of these years pharma is going to outperform, but it certainly wasn't 2010. Barnes and Noble stumbled this year, which also didn't help. Black Box did well and a couple others were okay, but the average 3% return is nowhere near the S&P500 return of around 13%.I'm not planning on continuing to post this exercise, but I will go ahead and list my 2011 picks, without a lot of comment. Pharma again predominates and a lot of carryover from last year.MRK, T, MDT, BMY, AMGN, INTC, MSFT, JNJ, PG, D.Intel and Dominion join the portfolio. Microsoft makes a return from previous years. All the others are repeats from last year. BBOX, BKS and PFE fall off the list, but I still hold them in my larger portfolio. All large caps now. AMGN is the sole non-dividend payer.
This is quite the inactive board, however, thanks for your post.What are your thoughts on PFE?
I like PFE. It dropped off my list this coming year based on weakness in ttm earnings. Earnings look to be improving, however. Long term growth, however, may not be super-attractive. I'm bullish on pharma in general, but have no idea when business performance will be reflected in the stock prices. It's quite likely that PFE will rise in my rankings following the 4th quarter report.Sorry that's pretty superficial, but I don't get too in-depth in my analysis.
Maybe I can capture the segment with a ETF?
We also hold IXJ, which hasn't fared particularly well the last few years. Does give you exposure to JNJ, MRK, PFE, ABT, LLY, Novartis, Glaxo, etc...http://us.ishares.com/product_info/fund/overview/IXJ.htm
It has beat it's benchmark however...
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