3 Buy-Now Stocks From the "World's Greatest Retirement Portfolio"

Updated

It's been almost 20 months since I introduced the World's Greatest Retirement Portfolio to Foolish readers. This was, has been, and will continue to be my way of helping the world to invest better. Putting my money where my mouth is, I pledged to put at least $4,000 behind each stock and attempt to hold each one for at least three years -- though I've already broken that promise.

Since I began, the market has returned 15.5%, not bad at all by historical measures. But this portfolio has lived up to its moniker as the "World's Greatest," outperforming the market by over 12 percentage points.

Below, I'll show you why it's doing so well, offer up three stocks that I think are excellent buys right now, and offer access to a premium report that offers deeper analysis than I can cover in one article.

Company

Publication Date

Change

Vs. S&P 500

Google

6/26/11

49.8%

32

Pricesmart

6/28/11

54.8%

38

Baidu *

9/15/12

(6%)

(21)

Intuitive Surgical

7/25/11

24%

11

National Oilwell Varco

7/28/11

(12.9%)

(29)

Coca-Cola

6/21/11

18.3%

2

Whole Foods Market

7/5/11

48.4%

35

Amazon

7/12/11

21.8%

7

Apple

6/30/11

65%

51

Johnson & Johnson

8/1/11

16.1%

(1)


Source: Fool.com, all returns as of market close Jan. 2, 2013. *Returns are for position in ATVI held from July 15, 2011, to Sept. 9, 2012, and transferred over to BIDU on Sept. 15, 2012.

The past few days have treated the portfolio nicely, with both Apple and National Oilwell showing significant gains. That's good news, especially because I have called them out as best buys in the past few months.

But although I think that Apple and National Oilwell are quality companies, they didn't get a nod for this month's best buys. Instead, these three companies made the cut:

Baidu
If you follow my suggestions regularly, I'm probably sounding like a broken record right now. I've been talking about Baidu -- China's largest Internet search engine -- and its potential versus its price tag for months, and called it out as my top stock to buy for 2013.

The company has grown revenue by 80% per year over the last two years, and net income by 110% per year. You'd think that when you combine those numbers, with the fact that Baidu has an 80% market share in search, and the fact that less than 40% of Chinese residents have access to Internet yet, Baidu would be trading for a hefty price tag.

But the opposite is the case. Baidu trades for just 18 times expected earnings in 2013. That's due in part to concerns about the SEC investigating auditors in China, and in part to the fact that Qihoo 360 seems to be giving Baidu a run for its money in search. In the end, I'm not too concerned about either of these.

Intuitive Surgical
Intuitive, maker of the da Vinci Robotic Surgical System, which makes it possible for doctors to perform minimally invasive hysterectomies and prostatectomies, saw its shares dip more than 10% in the last two weeks of 2012.

The latest sell-off is likely due to a report coming out from well-known short-seller Citron Research. The research firm, which usually focuses on smaller companies that are accused of fraud, took a different approach with Intuitive, saying that the company is facing several lawsuits from patients, has unhappy employees, and has a product whose benefits are questionable.

From where I stand, lawsuits will always be commonplace for medical-device makers -- but Intuitive has a strong track record; though I think employee satisfaction is important, I think it's very difficult to gauge; and when it comes to the efficacy of robotic-assisted surgery, I think the patient's point of view is just as important as the doctor's.

Sure, it's important for doctors to monitor how effective da Vinci really is. But if I'm a patient, and I know the da Vinci will produce about the same long-term outcome as a standard procedure but it will be less invasive and require less recovery time, I'm definitely going to choose the da Vinci.

Whole Foods
Finally, I'm tabbing Whole Foods for the second month in a row. No, the stock isn't particularly cheap, nor is there any earth-shattering news coming from the company. Instead, I simply think Whole Foods is sitting on one of the most powerful movements in our society today -- a move toward healthy eating -- is well positioned to benefit from this movement, and has only built out one-third of its potential stores in America.

But this is still No. 1
There's no doubt that Baidu is my favorite of these three stocks. Our brand new premium report breaks down the dominant Chinese search provider's strengths and weaknesses. Just click here to access it now.

The article 3 Buy-Now Stocks From the "World's Greatest Retirement Portfolio" originally appeared on Fool.com.

Fool contributor Brian Stoffel owns shares of Apple, Amazon.com, Google, Intuitive Surgical, National Oilwell Varco, PriceSmart, Whole Foods Market, The Coca-Cola Company, Johnson & Johnson, and Baidu. The Motley Fool owns shares of Apple, Amazon.com, Baidu, Google, Intuitive Surgical, Johnson & Johnson, and Whole Foods Market. Motley Fool newsletter services recommend Apple, Amazon.com, Baidu, Google, Intuitive Surgical, Johnson & Johnson, The Coca-Cola Company, National Oilwell Varco, PriceSmart, and Whole Foods Market. 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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