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No. of Recommendations: 2
Luke

I'll try to address your first question for now and try to get to your second a little later (however, if you wan't to post your second question to the "Stocks that Interest You" board, I'm sure others in the community would like to take a shot).

First, AMX is a Latin American mobile phone company and only indirectly relies on high oil and commodities. However, if you are going with AMX on the premise that middle class growth in Latin America is only fueled by strong commodity prices, that is another discussion.

Second, sustained ridiculously high prices were never part of the assumptions in any investment theses.

While I think prices have overshot on the downside for the near term, I know for a fact that Bill, Nate and Tim didn't build in oil prices above $100 in their valuations of the various energy companies that have been recommended.

In fact, between October 2007 (when oil first broke above $80) and October 2008 (when oil dropped back below $90), CRESY, KHD, CBI, CEO, GSI and CGV were the only stocks recommended that were focused on commodities, and once again, none of the investment theses were based on continuing high commodity prices. Most of them were recommended only after a significant drop in the stock price (unreasonably steep by the advisor's estimates).

Part of the criteria when Bill, Nate and Tim make recommendations is a strong balance sheet. CEO is currently sitting on net cash over $6 billion. KHD is currently trading for less than its cash position. These sound like the kinds of stocks you are presuming risk averse investors will move into first.

AMX has debt, but at less than 50% of equity, not an unreasonable amount for a telecom in a growing market. Also, its strong cash flows and conservative capital expansion plans provide more than enough cover for debt obligations. PDS' recent acquisition of Grey Wolf will hurt its formerly strong balance sheet, but if you hop over to the PDS board, Nate feels the benefits outweigh the increased risk.

Finally, there is nothing short-term about what we do here at the Fool. The Best Buys Now are the stocks that we feel are available for the best risk adjusted value. The BBN are the stocks the advisors feel offer long-term investors the best value and chance at market beating returns 3-5 years down the line.

Hope this helps clarify things,
Nate
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