Make Money with the Best Stock Investments
We screened stocks on the NYSE
Surprising Winners in the Stock Market This Year
to find outstanding performers during the first six months of 2009, a period that began with general doom and gloom. There's a lesson to be learned from these winning stocks. When strong brands are oversold by pessimistic investors and trade at $1 or less, the best of them will bounce back with triple-digit gains. And small cap stocks have the advantage on the rebound. It's a lot harder for a $40 billion company to double in size than it is for a small cap $400 million company.
This Was the Best Quarter in the Stock Market
As investors jumped overboard
this year, company stocks were driven into the basement. Buyers who went bottom-feeding and dumpster-diving this year found good values in the $1 stocks. A look in the rear view mirror shows us what stocks were ready to pop.
With investors anticipating that worst
of the credit crisis was over, the second quarter of 2009 brought happy news in the stock markets. The S&P 500 index, representing over 70% of the total market capitalization of all stocks traded in the U.S., was up 15.2% for second quarter, its strongest quarter since 1998. The Dow rose 11% with its best quarter since 2003. And the NASDAQ Composite climbed up 20%, also its strongest quarter since 2003.
The top 5 Dow stocks were Bank of America Corp, up 93%, American Express Co, up 70%, ALCOA Inc., up 40%, Microsoft Corp, up 29%, and The Walt Disney Co., up 28%.
The Top Ten Money-Making Stock Investments
On the New York Stock Exchange
, the top 10 performers during the first half of 2009 were:
- DTG Dollar Thrifty Automotive Group Inc, up 846% to $14.77
- CAR Avis Budget Group Inc, up 468% to $5.63
- BGP Borders Group Inc, up 457% to $3.18
- RT Ruby Tuesday Inc up 386% to $6.96
- VM Virgin Mobile USA Inc, up 331% to $3.41
- COT Cott Corp up 311% to $5.63
- OMN OMNOVA Solutions Inc up 2955 to $3.68
- RAD Rite Aid Corp up 274% to $1.31
- VCI Valassis Communications Inc, up 270% to $6.15
- PIR Pier 1 Imports Inc up 246% to $1.87
#1 Stock Investment: Dollar Thrifty Automative Group
DTG, Dollar Thrifty Automotive Group
takes first place for price performance during the past six months. Moving from under $2 to $14.77 in a mere six months, the stock price traveled in the fast lane with a breathtaking return of 846% after the stock bottomed at a 52-week low of 60 cents in early March. Its Dollar and Thrifty car rental stores rent and lease automobiles in competition with Hertz and Avis. There is also a used car sales franchise network. Of its 741 locations in the United States in Canada, 400 are company-owned and 341 are franchises. Founded in 1989, company headquarters are in Tulsa, Oklahoma.
Car rental prices are up
in the stores, and investors are betting that Americans will return to summer vacation travel and dump the stay-at-home stay-cation. Back at the end of 2006, the last of the good times, Dollar Thrifty sold for more than $40 per share.
The quarter that ended March 31, 2009
brought a loss of .42 per share or $8.9 million versus a loss of $14.07 per share or $297.9 million a year ago. Rental revenue was down 9% for the quarter, and the size of its fleet was down 10% from last year. For 2009 revenue is estimated to be down 6% to 12%. Dollar Thrifty said the bankruptcy of Chrysler will not affect the residual value guarantees Chrysler offers to Dollar Thrifty on its cars.
#2 Stock Investment: Avis Budget Group Group
In the same industry as DTG
, Avis Budget Group, CAR, returned 468% over six months as the stock price finished at $5.60. Avis Budget Group provides car and truck rentals in Avis and Budget stores. It changed its name from Cendant Corporation to Avis Budget Group, Inc. in August 2006. Avis Budget Group was founded in 1946 and is based in Parsippany, New Jersey.
In 2008, the company lost over $1 billion
on revenues of about $6 billion. With the downturn in vacation and business travel, Car expects rental days to drop 22% in the second quarter. As losses pile up, and the debt to capital ratio is at 99.4%, Avid Budget Group is not an investment for the prudent buyer.
#3 Stock Investment: Borders Group
Borders Group fell from $20 to under $1 and is now making back some value for investors. It rose 457% to 3.18 during first half, 2009. Borders Group, Inc. sells book, music, and movie stores under the name of Borders and Waldenbooks, in the United States, Puerto Rico and the United Kingdom. It operates over 900 stores and an Internet site. The company was founded in 1971 and has its headquarters in Ann Arbor, Michigan. Borders recently introduced a new eBook reader to compete with Amazon's Kindle. The accounting year ended January 31, 2009 brought a loss of $186 million on revenues of $3.3 billion. Borders stock has benefited from a big bounce after falling down a hole.
#4 Stock Investment: Ruby Tuesday
Stock of Ruby Tuesday gained 386%
for far-sighted investors when it rose to $6.96 a share.
Ruby Tuesday, Inc., casual dining restaurants, owns 721 stores, is a partner in 122 more stores and franchises 102 additional stores in the United States and other countries. The company was founded in 1920 and is based in Maryville, Tennessee.
Like its competitors, Ruby Tuesday
has falling same-store sales and declining traffic. However earnings are positive, and came in fourth quarter at $.28 per share, up from $.27 in 2008, after the company cut costs and closed some underperforming stores. Ruby Tuesday is estimated to earn .90 per share for this year ending June, 2010.
#5 Stock Investment: Virgin Mobile
With its stock now at $3.41 a share, Virgin Mobile USA Inc
, VM, has returned 331% for investors so far this year. Virgin Mobile USA, Inc., a wireless communications services provider, offers prepaid and postpaid services for the youth market primarily in the United States and wireless plans with and without a contract. With more than 5 million customers, coverage is provided by the Sprint Network. Virgin Mobile handsets are sold in the United States at 40,000 retailers and its online site. Virgin Mobile cards are available at almost 150,000 locations.
Virgin Mobile competes in the current pricing war
with five other prepaid wireless companies, Boost Mobile, Sprintís prepaid unit; Leap Wireless; MetroPCS; T-Mobile; and Tracfone, the U.S. prepaid unit of America Movil. Traditional prepaid plans are being replaced by unlimited calling prepaid plans at typical rates of $50 a month.
At Virgin Mobile the real action
is in the numbers. The ailing economy has helped prepaid wireless companies because consumers seek out cheaper cellphone plans. Year-over-year growth in earnings per share is 62.70% while year-to-date earnings per share have grown 181.50%. In the year ended December 2008, VM earned $6.8 million on $1.3 billion revenue. In the latest reported quarter, the company earned $19 million, or 19 cents per share, which was up 300% from a profit of $4.7 million, or 7 cents per share, in the year-earlier period. The profitability is attributed to the popularity of its new calling plans. Revenue for the quarter climbed 2.2 percent to $337.3 million from $330 million.
#6 Stock Investment: Cott Corp
Cott Corp, COT, saw a stock price increase
of over 300% to $5.63 in the past six months. Cott Corporation manufactures bottled and canned non-alcoholic beverages including carbonated soft drinks, flavored water, juices, water, teas and energy drinks. Their many beverage brands are in groceries and chains in North America, the United Kingdom, Mexico, and other countries. The company was founded in 1955 and is based in Tampa, Florida.
In year ended December 2008, Cott lost $122 million
on revenue of $1.6 billion. For the first quarter of 2009, Cott earned $19 million. on revenue of $367 million. Revenue was down 5.8% although the company focused on private label products preferred by value-conscious consumers.
#7 Stock Investment: OMNOVA Solutions
Shares of OMNOVA Solutions rose to $3.68
in six months for an increase of about 300%.
OMNOVA Solutions makes chemical coatings, binders, and adhesives, which are used in paper, carpet, nonwovens, construction, adhesives, tape, tire cord, floor polish, textiles, graphic arts, plastic parts, and various other specialty applications. The Decorative Products segment manufactures commercial wallcoverings, coated and fabrics, vinyl, paper and laminates. OMNOVA products are used in commercial, industrial and residential markets around the world, including construction, automotive, boats and school buses, recreational vehicles and industrial films. OMNOVA Solutions was founded in 1999 and is headquartered in Fairlawn, Ohio.
In its latest year ended November, 2008
, the company lost $2 million on revenue of $869 million. OMN now has eps of .21 (ttm - trailing twelve months) and p/e of 18.
#8 Stock Investment: Rite Aid Corp
Moving from .35 to 1.31 over six months
, Rite Aid Corp gained 274% for investors. Rite Aid Corporation operates 4,900 retail drugstores in the United States. In addition to pharmacy service, Rite Aid sells about 28,000 products for health and beauty, over-the counter-medication, personal care, household and seasonal, convenience foods, greeting cards and photo processing. Many products carry its own brand. Rite Aid Corporation was founded in 1927 and is headquartered in Camp Hill, Pennsylvania.
The walk-in clinics in stores
like Walgreen, CVS and Target, as well as grocery stores like Kroger, are changing the way the health-care business works. At this point Rite Aid and Wal-Mart lease space to in-store clinics, rather than run their own service. This clinic concept should benefit from proposed government health plans, if conventional medical care and doctor services become scarce.
In the year ended February, 2009
, Rite Aid lost about $3 billion on revenues of $26.3 billion. Rite Aid same store sales in June were down only .6%, a good showing compared to other retailers. Net loss for the thirteen week period ended May 30, 2009 was $98.4 million compared to net loss of $156.6 million in the corresponding quarter 2008. Quarterly revenue was $6,531,178 billion, down 1.2%. Same store sales grew .6% during the quarter. While competitor Walgreen is expected to earn $2 this year, Rite Aid is estimated to lose $.46 this year.
#9 Stock Investment: Valassis Communications
Stock of Valassis Communications Inc.
, VCI, jumped to $6.15 a share with a gain of 270% during the first half of 2009. Valassis Communications provides direct mail marketing to businesses. It creates bundled advertising direct mailers, door-to-door mailers, and provides marketing support through the United States and abroad. The company was founded in 1970 and has its headquarters in Livonia, Michigan.
Marketing budgets take a big hit
during any economic slowdown. During calendar year 2008, the company lost $200 million on revenues of $2.4 billion. For the first quarter ended March 31, 2009, the company revenues were $551.2 million, down 7.7% from $597 million for the prior year quarter. First-quarter net earnings were $13.0 million, up 19.1% from the prior year quarter. First quarter earnings per share were $0.27, up from $0.23 in the prior year quarter.
#10 Stock Investment in Pier 1 Imports
The stock of Pier 1 Imports, Inc. jumped
from $.54 to $1.87 for a gain of 246% during the first half of the year. Pier 1 is a specialty retailer of imported decorative home furnishings, gifts, as well as items for the kitchen, bath and bed. The company operates 1,011 stores in the United States and 81 stores in Canada under the name Pier 1 Imports The company was founded in 1970 and is headquartered in Fort Worth, Texas.
During the year ended February, 2009
, Pier 1 lost $129 million on revenues of $1.32 billion. For first quarter of 2010 Pier 1 brought in earnings of $29 million, or $.32 per share versus a loss of $33 million, or $.37 per share, in the year-ago period. Sales were down 9% and same-store sales were down 7.5%. But Pier 1 made a gain on paper of $48 million when it sold some outstanding convertible debt for $27 million to a foreign subsidiary. Investors decided not to look a gift horse in the mouth.
I hope life brings you much success.
I wish you a very happy day.
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