With best advisors participating in this year's survey, there's something for every type of investor, from high quality blue chips to speculative home runs.
As always, we caution you to only use these ideas as a starting place for your own research and only buy stocks that meet your own personal investing criteria, your risk parameters, and your time horizon.
Importantly, these stocks represent each advisor's current outlook. As fundamentals change during the year, a favorite "buy" can become a strong "sell". As such, It is up to each investor to monitor future develops at the underlying companies to be sure that the reasons behind buying a stock remain in place. We wish you the very best for your investing in 2011.
Permalink: [612] Top Stocks To Buy - Best Value Stocks For 2011
Best Value Stocks For 2011: Aastrom Biosciences
by John McCamant, editor The Medical Technology Stock Letter
We are recommending Aastrom Biosciences (ASTM) as our top stock recommendation for 2011 because we believe that they are the clear leader in the regenerative stem cell space.
The company is focused on the development of autologous cellular therapies for the treatment of cardiovascular diseases utilizing its Tissue Repair Cell (TRC) technology. We are impressed with the Phase II clinical data sets we have seen in Critical Limb Ischemia (CLI) and ASTM will start a Phase III development program to treat CLI patients in 2011.
More importantly, we believe that ASTM has the experienced and motivated management team with a proven track record of creating shareholder value. Tissue repair cell (TRC) technology is ASTM's platform for processing a patient's bone marrow cells into a therapeutic treatment. The collected sample of bone marrow will contain mostly hematopoietic and endothelial stem cells.
Simply put, ASTM's technology increases the amounts of other types of cells in a way that mimics the response to a wound, increasing the sample's regenerative properties. When the cells are re-inserted into the patient they act in harmony to regenerate the vasculature (in the case of CLI).
ASTM has published convincing research, corroborated by independent experts, that a mixed population of stem and progenitor cells is optimal for regenerating tissue, and it makes sense intuitively that many cells will work better than a single type since the body naturally uses many di"erent cell types acting in concert. In addition to the CLI clinical program, ASTM also has an ongoing program to use the TRC technology to treat dilated cardiomyopaty (DCM).
DCM is an enlargement of the heart due to weakening, leading to further degradation of cardiac function and associated with end- stage heart failure.
The only option left for these patients is a heart transplant, but ASTM's technology may help to regenerate the heart and add time and quality to these patient's lives. Both of these clinical programs and ASTM's TRC technology are protected by a strong intellectual property portfolio.
We are very familiar with ASTM's new CEO, Tim Mayleben, who took over the reins at the Company late last year.
Mr. Mayleben served as COO of Esperion Therapeutics, where he led the raising of more than $200 million in venture capital and institutional equity funding. On top of that, far and away his most impressive achievement was when Tim led the negotiations that triggered the acquisition of Esperion by Pfizer in December 2003 at a huge premium.
Tim has significant operations experience and has no pie-in-the-sky illusions regarding the di#culty of navigating new technologies through the FDA gauntlet. We have found through the years that it is much harder to get new technologies to market than anyone has forecasted.
This puts an even higher premium on quality management, as the promise of a technology is not enough in the hands of poor leadership. The upcoming year is shaping up to be an excellent time for ASTM. The company has recently raised cash that will enable them to start their Phase III progrma for CLI patients in 2011. We could also see the CLI Phase II data published in a peer-reviewed medical journal, which would be an important validatation of the Company's technologies and drug dvelopment candidates.
Interestingly, publication of Phase II data was one of the main drivers that got Esperion bought by Pfizer for a huge premium.
We have been impressed with ASTM's management team and have growing confidence that they will continue to deliver and create value for their shareholders. With the recent financing out of the way we believe the stock is poised to regain momentum. We are recommending ASTM as a buy under $3.50 with a one year target of $7.
Best Value Stocks For 2011: Uranium Resources
by Brendan Coffey, editor of Cabot Green Investor
Zero emissions is the holy grail of green technology as the world looks to grapple with the converging pressures of tight fossil fuel supplies, air quality issues and global warming.
I see the push for zero emissions reviving a technology once largely written o": nuclear power. In light of this, my top pick for 2011 is Uranium Resources (URRE). At this moment, some 60 nuclear plants are under construction worldwide. In the U.S., where nuclear plant construction has been dormant for decades, as many as eight new plants are scheduled to be built by 2020.
China, the fastest growing energy user in the world, should be a major driver in the market: It's building 30 nuclear reactors right now to add to its existing 12 and has an additional 157 planned.
In the next 20 years, global annual uranium demand is projected to double and the supply pressure is already starting to be seen.
From May to December 2010, uranium prices rocketed up 50% and appear set for a stronger 2011 as the market prepares for the end of the Megatons to Megawatts program in 2012.
Uranium Resources is a small uranium miner in Texas, which has produced 8 million pounds of the commodity in its 33 years of operation.
The real value in URRE isn't in its mining abilities however—it's a relatively high-cost producer, and it stopped mining for the first part of 2010 due to soft prices. Rather, over the years it has amassed parcels in New Mexico that hold over 101 million pounds of uranium, giving URRE the eighth-largest uranium reserves in the world.
By comparison, industry leader Cameco has just nine times the reserves of Uranium Resources but 50 times the market value.
That makes URRE ripe for a takeover. Until then, its share price tends to trade in tandem with uranium's price, meaning the coming year should benefit shareholders regardless of whether a takeover bid materializes.
Learn more about this financial newsletter at Brendan Coffey's Cabot Green Investor.
Best Value Stocks For 2011: VIST Financial Corporation
by Benj Gallander and Ben Stadelmann, editors Contra the Heard
VIST Financial Corporation (VIST) is our favorite investment idea for the coming year. Last April two institutional investors specializing in banking recently purchased 644,000 shares at $8.00, moving the share count to around 6.5 million. The stock fits in with our focus recently of buying financial plays. This past quarter there was a nominal loss of $602,000, knocking net income for the first nine months of this year down to about $2.5 million.
Last April two institutional investors specializing in banking recently purchased 644,000 shares at $8.00, moving the share count to around 6.5 million. Perhaps the buyers were regarding the bank's capital ratios, which exceed all regulatory guidelines.
Or maybe they like that VIST is looking to grow somewhat with the purchase of Allegiance Bank that is expected to be accretive immediately. Whatever their rationale, this pushed insider ownership to better than 11 percent.
Our target price is $24.75, a distance from the current level of around $7.00. The stock had a good stretch where it traded above this price.
The annual dividend of $0.20 will almost certainly increase if the operation returns to previous levels of profitability.
Learn more about this financial newsletter at Benj Gallander's Contra the Heard.
Best Value Stocks For 2011: PMC-Sierra
by Daniel Frishberg, editor The MoneyMan Report
PMC-Sierra (PMCS) -- our top pick for 2011 -- develops semiconductor system solutions for advanced communications.
This choice is based on our forecast is for accelerating growth in the U.S. along with powerful growth sustained in developing markets. In our view, this should lead to rapid acceleration in PMCS' stock price.
Its systems include their pioneering work on Asynchronous communication, which changed the way data packets are carried around the world via telephone networks, wide area networks and local area networks.
To understand why profits are exploding at PMC-Sierra, and why they will continue as long as global growth holds up, you only have to remember how frustrating it was to send and receive real-time entertainment and voice over the internet just a couple of years ago.
Today, our radio program is listened to all over the world, carried by small packets, on smart-phones and other devices that are far more convenient than AM radio.
Every day, we communicate for free, or very cheaply, by voice and even video, with reception that if not as good as the movies, at least works, and it is clear to us that another billion people in the world will soon be enjoying these same benefits. The PMCS' leadership in areas named by acronyms, such as ATM, WAN, LAN that few investors really understand.
While these products provide a moat around them which insures profitability, the complex nature of its systems has also inhibited the rush to buy their stock, as so many people fail to understand what the company actually does.
Nevertheless, the pent-up demand for IT infrastructure is now being satisfied, and PMCS sales are accelerating along with additional leverage a"orded by rising profit margins.
This will allow earnings to almost double if our 2010 expectations prove correct. The company has plenty of cash available to continue R&D, and to maintain a powerful pipeline of new product o"erings allowing continued improvement in service in this very hot area.
Assuming the company continues the very rapid growth in earnings, which we fully expect, the market will soon begin to a"ord PMCS much higher multiples, which could make the company one of the standout stocks for 2011.
The economic recession in the first half of 2009 does show that progress in this industry is somewhat vulnerable to interference by a declining economy. In addition, the semiconductor industry in general has always been highly volatile and economically sensitive. However, we think PMCS o"ers the right balance of risk and reward.
Best Value Stocks For 2011: Longwei Petroleum Investment Holdings
by Jim Trippon, editor China Stock Digest
Longwei Petroleum Investment Holdings Ltd. (LPH) is one of the leading diesel, gasoline, fuel oil and solvent oil distributors and wholesalers in Shanxi Province, China (near Beijing).
The company sells its products mainly to large-scale gas stations, coal plants and power supply companies, and on a smaller scale to small, independent gas stations. Shanxi Province, where Longwei operates, has no oil fields or oil refineries and thus provides a unique market space for fuel oil and petroleum products.
Longwei serves the heavy industries in this rapidly growing region. Shanxi Province's demand for fuel oil has experienced double-digit growth in the past several years. Despite the recent setback caused by derivative contracts, we share Longwei's optimism about future performance. That's why we have set such a high target sell price of $20.00 relative to the current share price.
The company has a forward P/E ratio below 4.0, and a profit margin of 12.07 percent. The company is looking for strong future growth based on rapidly increasing auto usage in China as well as rising industrial activity.
Longwei says China's rapidly growing economy will drive energy demand growth rates of four to five percent annually through 2015. Production and distribution of energy will be one of China's greatest challenges in the coming years. In its earnings report released in November the company increased its profits by a stunning 131 percent to $50.2 million for the year ending June 30, 2010 (the end of its fiscal year).
The company surpassed its revenue guidance for the period by 10 percent. In its guidance for fiscal 2011 the company projects revenues to exceed $500 million and adjusted net income to exceed its forecasted $73 million (the adjusted net of derivative and financing costs).
Best Value Stocks For 2011: Citigroup
by Jim Powell, editor Global Changes & Opportunities Report
After two years of economic declines, even the small uptick in growth we are starting to see should be a tonic for America's battered banks.
Of the major U.S. banks, I think Citigroup (C) o"ers investors the most promise; as such, I am selecting the stock as my top pick for 2011.
Banks are sitting on a mountain of federal bailout cash they want to put to work by loaning it out. Until recently, however, there was little demand for credit. Now that's starting to change.
It may come as a surprise, but the mild to moderate in?ation we can expect in 2011 can be positive for banks.
The institutions will simply increase their rates accordingly. Then they will add a little more for good measure, and for greater profits.
Although Citigroup must be considered a speculation, I think the worst is behind Citigroup, and its long-term outlook is good. Citigroup is now returning to its banking roots by providing advice, facilitating transactions, and serving consumers throughout the world.
The company is greatly expanding its operations in Asia and South America where it is finding a great deal of new business. Citigroup is nearly free of its TARP debt and the government restraints that went with it. In e"ect, the bank is "o" parole."
Once Washington has sold the last of the Citigroup stock it received in exchange for the bailout funds, I think the price will start to rise again. Citigroup is still carrying some bad paper and a lot of debt from its past mistakes. However, it appears that the bank is valuing the assets well below their fair market values.
In any event, the company is selling its discounted assets, reducing its debt, and refocusing on its strengths. Citigroup is once again profitable and should stay that way.
Best Value Stocks For 2011: Computer Sciences
by Sy Harding, editor Street Smart Report
Computer Sciences (CSC) -- our top pick for 2011 -- is a global leader in providing information technology and related services to commercial accounts and government agencies.
In our view, the wind is likely to be at the company's back as the economic recovery continues to strengthen over the next two years.
The company specializes in complex IT applications, and its services include operating all or portions of a customer's technology infrastructure, including systems analysis, applications development, network operations, and data center management. The company weathered the 2007-2009 recession with ease, but experienced sluggish growth in 2010.
However, the future looks brighter again as the company's 'qualified new-business folder' has grown 20% from a year ago, with potential for new government contracts particularly promising.
For example, CSC announced a number of deals in December, including a seven-year agreement with a major insurance company for the use of Computer Sciences' Wealth Management Accelerator software.
The company also announced a $33 million contract with the Department of Veteran A "airs, and four application management contracts with the Environmental Protection Agency.
Computers Sciences was also honored in December as '2010 Enterprise Cloud Leader' at the 2010 Cloud Expo in California for its leadership in guiding customers in the implementation of 'cloud-computing'. The shares are selling at just 8.6 times estimated 2011 earnings, and at about one times book value. We have a 12-month upside target of 60.
Best Value Stocks For 2011: Timberline Resources
by Gene Arensberg, editor Got Gold Report
Timberline Resources (TLR) is a soon-to-be gold producer that we believe has been overlooked by the market. However, we doubt it will remain overlooked for much longer.
Overall, I consider this a strongly undervalued stock that is highly likely to have a string of excellent news in 2011.
Not exactly a household name, Timberline's management teamed up with the premier underground mining and development company in North America, Small Mine Development (SMD), to develop the Butte Highlands gold deposit just south of Butte, Montana.
Timberline provided the project; SMD provides the development funding and knowhow to bring the gold ore out from under Nevin Hill.
When we visited the future mine in June of 2010, the 16-foot tall and 14-foot wide development ramp had already been excavated nearly 1,000 feet down. Timberline shareholders benefit from the SMD partnership because the company did not have to heavily dilute the share structure in order to raise the development capital
to get the gold ore out of the ground.
In addition, the company will spare investors the cost of building an expensive processing mill because the ore can be hauled to nearby existing third-party processing facilities already permitted and operational in Montana. Once the development capital has been recovered through production, the partners will share the net proceeds of the gold mined at Butte on a 50/50 basis.
Timberline estimated in 2010 that the cost of production for the gold would be less than U.S. $500 the ounce given the richness (high grade) of the deposit. With gold above $1,300 the ounce that means that the Butte Highlands project should enjoy significant positive cash ?ow once production, estimated to be about 50,000 to 70,000 ounces per year, begins.
The mine could be operational for approximately ten years at that production level, perhaps longer if there are additional resources discovered just ahead.
Best Value Stocks For 2011: Under Armour
by Bernie Schaeffer, editor Schaeffer's Investment Research
Athletic apparel manufacturer Under Armour (UA) has been a solid performer in 2010, gaining 110 percent year-to-date.
The stock -- our top pick for 2011 -- has been in a strong uptrend since early September, and is trading above all major moving averages.
On the fundamental side, the company has reported earnings per share that have surpassed analysts' estimates for seven consecutive quarters.
UA reported third-quarter revenues that rose 21.9 percent year over year.In fact, the company has reported revenue growth of more than 15 percent in each quarter since the first quarter of 2008. UA also issued upside guidance for the third straight quarter.
Despite the strong technical performance and solid fundamental results, the stock faces a particularly pessimistic backdrop.
Analysts have remained on the sidelines during the equity's run higher, as currently only five of the 25 analysts covering the stock rate it a "buy."
Should the company continue to outperform expectations, analysts could begin to change their tune, potentially pushing the shares higher.
Short sellers appear to be in the early stages of recognizing the company's consistently improving outlook.
Since reaching a peak in September 2010, short interest has been steadily declining. However, nearly 14 percent of the stock's ?oat remains sold short, representing significant pent-up buying pressure.
A continuation of this short-covering as we move into 2011 could also continue to drive the shares higher.
UA looks poised to have another solid year in 2011 on the heels of positive fundamentals and the unwinding of the surprisingly large amount of pessimism surrounding the shares.
Best Value Stocks For 2011: Apple
by Stephen Quickel, editor US Investment Report
After its two-year romp from 85 to 320 you might be leery of buying Apple (AAPL). The stock's advance has slowed noticeably since topping 300 in October. Even so, we regard Apple as one of our top picks for 2011 -- destined to crack above 400 in the year or so ahead.
True, the autumn surge in trading volume has abated since carrying AAPL above 300 (from our November 2008 entry price of 87).
But the stock deserved a rest after its 33% run from 240 last summer. And while taking a breather, it has never closed below 300 since first hitting 320 in early November.
It brie?y touched it 50-day moving average just before Thanksgiving, but as of Dec. 20 had regained 320 on fairly moderate volume. From our vantage point, that's just the beginning of its next major move.
The obvious driver is Apple's continued outpouring of brilliant new products. But upgraded versions of its iPad and iPhone, plus other attractive new o"erings, are only part of our rationale for Apple's move to 400 and beyond.
They will keep the competition at bay--and keep earnings growing by the expected high teens percentages (First Call projects 20% a year five-year growth). To us, the stock's biggest attraction right now is its bargain-basement valuation.
It's incredible that this growth stock to beat all growth stocks today trades at just 14.5 times estimated 2011 earnings of $19.19 per share. And at an amazing PEG ratio (P/E divided by earnings growth rate) of 0.80 based on 18% a year growth. A PEG of 1.00 is considered ideal, making AAPL's 0.80, if you will, super ideal.
Here's the icing on the cake: We believe AAPL deserves to trade at a forward P/E at the 18 level ; the stock s, and should easily reach that in a buoyant economy. With earnings of $22.20 now projected for 2012, we see a price target of $400 sometime in 2011 or just beyond, up 25% from today's level. The current consensus guesstimate of 14 sell-side analysts calls for earnings of $24.63 in 2013. You can do the rest of the math for yourself.
