The Motley Fool's Weekly Editors' Picks
Fools were out and about this past week in an investing world jam-packed with actions and ideas. Here are three articles you might find useful as you decide how to invest your money.
Motley Fool Rule Breakers team member Tim Beyers is back with a "Big Idea Portfolio" of five tech companies leading big industry shifts. He's betting these stocks beat the market over the next three years and will be tracking their performance on Fool.com.
Apple's an obvious choice, Tim said. It has the uber-popular iPhone, and developers are flocking to create apps for iOS. It's "a magnet for coders looking to create the Next Big Thing in mobile software," Tim wrote.
Apple's starting share price is $422.46, while Rackspace Hosting clocks in at the more affordable $41.65. Tim dubs Rackspace a "Foolish" company focused on delighting customers. "Mix in strong and improving incremental returns on capital and an increasing need for hosting websites and services as the Web grows in popularity as a platform for doing business, and you have the makings of what I believe will be an outstanding long-term Rule Breaker," Tim wrote.
Read the article to get all of Tim's insight.
Buying stocks can be fun, but investors can't ignore that they need to know when to sell, and Fool analyst Alyce Lomax thinks it's time to sell teen-oriented retailer Abercrombie & Fitch (NYS: ANF) . Shares have fallen 17% in the past 12 months, and 2012 doesn't look promising as Abercrombie faces desperate rivals and worn-out consumers, Alyce wrote.
"Although analysts expect it to generate $4.2 billion in sales for the fiscal year ended January 2012, they also only expect earnings of $2.81 per share. In the last 12 months, Abercrombie's gross profit margin had continued its downward trajectory to 60.1%," she reported.
Read the article for all of Alyce's analysis and to see the more reliable retail stock idea she recommends.
How are you going to pay yourself this year? Sean Williams, a growth-stock-loving Fool, has resolved to pay himself by investing in dividend-paying companies. "[W]ell into my 13th year of investing, I've realized just how stupid it's been of me to turn down free money for all of those previous years," Sean wrote.
Sean has dividend stalwart Johnson & Johnson (NYS: JNJ) on his watchlist, noting its solid portfolio of health-care products. He gives J&J the edge over Procter & Gamble thanks to J&J's its slightly lower forward earnings multiple and marginally higher dividend yield of 3.5%.
Sean also like the prospects of Annaly Capital Management (NYS: NLY) , which invests in mortgage securities backed by the U.S. government and makes money on the difference between the rate at which it borrows and the rate at which it lends. "Annaly will provide my portfolio with a low-beta, high-yielding stock that could double my investment based on the dividend alone within just a couple of years if the proceeds are reinvested," Sean wrote.
Read the article to see all the stocks in Sean's sites.
To get a hot stock tip from The Motley Fool's chief investment officer, you'll want to get the free report "The Motley Fool's Top Stock for 2012." Check out the details on this "Costco of Latin America."It's free.
Fool online editor Kris Eddy owns no shares of any stocks mentioned in this article.
At the time this article was published The Motley Fool owns shares of Google, Apple, Johnson & Johnson, and Annaly Capital Management.Motley Fool newsletter serviceshave recommended buying shares of Riverbed Technology, Annaly Capital Management, Johnson & Johnson, Procter & Gamble, Rackspace Hosting, salesforce.com, Google, and Apple; as well as creating a bull call spread position in Apple, creating a diagonal call position in Johnson & Johnson, writing covered calls in Riverbed Technology, and shorting salesforce.com. Try any of our Foolish newsletter servicesfree for 30 days. We Fools don't all hold the same opinions, but we all believe thatconsidering a diverse range of insightsmakes us better investors. The Motley Fool has adisclosure policy.
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