3 Stocks to Buy From the World's Greatest Retirement Portfolio
Truly successful investing means taking a long-term approach. No, that doesn't mean weeks or months; it means years and decades.
In an effort to help force myself to take such an approach, I publicly picked 10 companies last summer that I would be investing over $40,000 in. I vowed to hold these 10 companies for at least three years, or else make a donation to charity if I sold too soon.
It's been about eight months since I made that first purchase. Below, you'll see how the portfolio is performing, why it's doing so well, and three companies I think are great buys right now. Read all the way to the end, and I'll give you access to our top investing idea for 2012, too.
Vs. S&P 500 (percentage points)
|June 26, 2011||28%||20|
|PriceSmart (NAS: PSMT)||June 28, 2011||29.1%||22|
|Activision Blizzard (NAS: ATVI)||July 15, 2011||0.3%||(5)|
|Intuitive Surgical (NAS: ISRG)||July 25, 2011||27.5%||24|
|National Oilwell Varco||July 28, 2011||1.9%||(5)|
|Coca-Cola||June 21, 2011||6.9%||0|
|Whole Foods||July 5, 2011||26.9%||23|
|Amazon.com||July 12, 2011||(14.9%)||(20)|
|Apple (NAS: AAPL)||July 30, 2011||36.7%||29|
|Johnson & Johnson (NYS: JNJ)||Aug. 1, 2011||3.7%||(4)|
Source: Fool.com. Returns accurate as of market close on Feb. 29. Includes dividend reinvestment.
The market had a pretty good February, and my retirement portfolio definitely benefited from the movement, offering significantly improved returns in just a month's time. I can't complain about kicking the market's tail by over 8 percentage points, either!
Without a doubt, two of the biggest reasons for the improvement were the performances of Intuitive Surgical and Apple. Both companies crossed the psychological barrier of the $500-per-share mark, and I think both still have room to run.
It's pretty clear that after a slight dip in price after earnings were announced, Wall Street realized the error of its ways for punishing robotic surgery specialist Intuitive Surgical. The company continues to operate without any significant competition, other than traditional surgical methods.
Apple, on the other hand, has been steadily trending higher since its astronomical earnings announcement in January. The combination of excitement surrounding the release of the iPad 3 and speculation that the company may finally pay a dividend has had the stock heading sharply higher since 2012 began.
Three best buys
But as impressive as these two stocks are, neither is on my list for best buys right now.
Instead, one of the companies I'm calling out is Activision Blizzard. I already know about concerns with falling subscriptions for the company's mega-hit World of Warcraft. But I think there's a lot more going on than just this one game.
Activision's most recent earnings announcement handily beat analysts' expectations, and the company will be coming out with Diablo III later this year. Combined with the already strong performance of Skylanders Spyro's Adventure, I think 2012 will be a strong year for the company.
Second on my list is PriceSmart. The company has actually had two consecutive misses on the earnings front. That would be concerning -- if you didn't understand why the company missed estimates. Primarily, the company is cutting prices to drive traffic, and that's been working. It's also shelling out cash to set up shop in South America, starting with Colombia. Both moves cost a pretty penny in the short term, but they should be paying dividends for the company -- and shareholders -- for years to come.
Finally, I want to call out one for the steady dividend payers in my portfolio: Johnson & Johnson. Sure, there have been some rough times over the past 12 months, but the metrics speak for themselves. The all-things-medical conglomerate is trading for just 12 times future earnings, while offering up an appetizing 3.5% dividend yield.
But which one is the "Top Stock"?
It came as no surprise to me when the Motley Fool named one of these 10 stocks as its Top Stock for 2012. If you'd like to find out which of these 10 stocks it is, I suggest you get your copy of the report today, absolutely free!
At the time this article was published Fool contributor Brian Stoffel owns shares in all of the companies mentioned. You can follow him on Twitter, where he goes by TMFStoffel.The Motley Fool owns shares of Google, National Oilwell Varco, Amazon.com, Johnson & Johnson, Activision Blizzard, Apple, Coca-Cola, and Whole Foods, and has written calls on Activision Blizzard. Motley Fool newsletter services have recommended buying shares of PriceSmart, Johnson & Johnson, Apple, Google, Intuitive Surgical, National Oilwell Varco, Coca-Cola, Activision Blizzard, Amazon.com, and Whole Foods Market, as well as creating a synthetic long position in Activision Blizzard, a diagonal call position in Johnson & Johnson, and a bull call spread position in Apple. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.
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