A Mid-Year Look at Top Ten Stocks for 2011

by: Chris Katje
This article is a follow-up to my article written on January 4th, 2011 found here.

With the calendar year halfway over, it is time to revisit my picks for 2011. In January, I wrote about my top ten stocks for the year, along with several honorable mentions. The stocks are listed below with returns and where they might be headed. I appreciate all the people reading my articles and am excited to have just crossed 500 followers here on Seeking Alpha. All prices are at market close on June 30, 2011. Returns have any applicable dividends applied.
The picks in alphabetical order:
1. Ameresco (NYSE:AMRC)
Start: $14.36
Mid Year: $14.18
Gain: -1%
Ameresco has been trading at a range of $13 to $16 from the start of the year. The company has a backlog of projects for several schools, government buildings and corporations. Ameresco remains a solid pick for the energy efficient field, as many companies will be trying to cut costs.

The chart shows two peaks and dips and the stock trading pattern is favoring a peak once again.
2. Bank of America (NYSE:BAC)
Start: $13.34
End: $10.96 plus $.02 in dividends $10.98
Gain: -18%

Bank of America shares have steadily declined since the start of the year. The entire financial sector has declined including the ETF Financial Select SPDR (NYSEARCA:XLF). I stick behind shares of Bank of America and am hoping they will return to the $15 level by the end of the year. Increased regulations on the banking industry has spoiled the industry and punished shares in the process.

Looking at the chart, you will see that Bank of America shares really haven't passed the $13 level since mid April. Shares will need to first get past the $12 level once again and then may beat resistance going upwards.
3. Case New Holland (NYSE:CNH)
Start: $47.74
End: $38.65
Gain: -19%

CNH sells its tractors and farm equipment in 170 countries. The agricultural industry remains hot, and the downfall of Case New Holland’s shares provides a great time to buy into the company. CNH is investing heavily in other countries likes Argentina to gain in emerging markets. These emerging markets are a great way to play the agricultural boom and Case New Holland will benefit. Look for shares to hit $50 by the end of the year.

Shares are down right now from their upward trend at the start of the year. The chart will show that shares are heading towards $44 again. If shares can break past that level, they will likely keep increasing.
4. Cisco (NASDAQ:CSCO)
Start: $20.23
End: $15.61 plus $0.06 in dividends $15.67
Gain: -23%

Cisco is one of the most widely reviewed stocks. I had targeted $30 by the end of the year for shares. With the recent beat down in the share price, that would be a 100% gain from here. I continue to believe the shares are undervalued, and they currently trade at less than ten times next year’s earnings. The company is not the growth stock it once was, but at this unseen level, it is now a tremendous value play. Look for shares to hit the $22 to $25 range, as mutual funds will likely pick up shares of the undervalued companies.

Two significant drops in share price in February and May can be seen on the chart. Shares are likely to increase and test those drop levels once more mutual funds and hedge funds pick up the undervalued shares.
5. Corning (NYSE:GLW)
Start: $19.32
End: $18.15 plus $0.10 in dividends $18.25
Gain: -6%
Corning shares have dropped slightly since the start of the year. The company is a leader in the glass market, and its new Gorilla Glass is changing the smartphone and tablet markets. The company will continue to gain market share, as more phones and tablets are sold. Corning shares will rebound by the end of the year and will likely hit $25.

Shares have just just entered their 2011 starting territory and as seen on the chart are heading upwards.
6. Dreamworks Animation (NASDAQ:DWA)
Start: $29.47
End: $20.10
Gain: -32%

Dreamworks has been one of the worst performers in the top ten stocks portfolio. The stock was beaten down to a poor performance from Kung Fu Panda 2. Shares are down from over $40 a share in 2010, and now trade at half that value. The company only has one movie coming out the rest of the year: Puss in Boots, which is a spinoff from the successful Shrek series. The company is beginning to do a better job at unlocking the value in its characters with licensing deals and recent expansion into amusement parks and cruise ships. The company will gain a little back in its share price if Puss in Boots is a success. The company has a better lineup in 2012 coming for those willing to buy and hold on the stock. I will likely be taking a loss on this stock for the year in this sample portfolio.

The chart shows how a movie relase impacts Dreamworks Animation shares. The release of Kung Fu Panda on May 26th of this year had a slight peak in share price leading up to the release. The release was followed with the large decline seen on the chart after the movie did not live up to expectations. Puss in Boots is being released on November 4th. The movie will likely impact the chart the same way. A slight increase will be seen before the movie opens and the shares will decrease or increase following the movie's release.
7. EMC Corporation (EMC)
Start: $22.90
End: $27.55
Gain: 20%
EMC is one of the few technology stocks that has had a good run in 2011. With a twenty percent increase already, EMC is likely to finish out the rest of the year strong. The company owns 87% of VMWARE shares (NYSE:VMW) and is likely to benefit from its passive ownership stake in the company as well. There is a new ETF coming with its focus on the cloud computing industry, and it will likely take a large stake in EMC or Vmware. Look for shares to flirt with $30 by the year's end.

The shares have dropped to $25 a couple times throughout the year, but have always managed to head upwards since then. The chart shows this pattern so if you are lucky enough to get shares close to $25 they should head straight back up.
8. HHGregg inc. (NYSE:HGG)
Start: $20.95
End: $13.40
Gain: -36%

The worst performer year to date has been the electronic supply store HHGregg. The company has 180 stores, which is more than the 131 it had to start the year. The company is underperforming, as many big box stores are having to cut prices to compete with each other and are hurting their own margins. Shares have been on the rise over the last month, and could potentially return to start-of-the-year prices if the new store openings go well and the company beats earnings when they report.

The chart shows how timing impacts the shares. I clearly picked the shares for my list when they were at their peak, as they immediately dropped in price and have headed south since. Shares in the last month had a couple of slight upward trends, and it would be nice to see them get past this level.
9. PriceSmart (NASDAQ:PSMT)
Start: $38.03
End: $51.23 plus $0.30 dividends $51.53
Gain: 35%
The 28 locations owned by PriceSmart have been successful at growing sales. Two locations are expected to open by the end of the year, including the company’s first in Colombia. Several analysts are picking up coverage of PriceSmart shares, and the company has been listed as a buy from many people. The company is a great play on emerging markets, as all of its stores are located in the Caribbean and Central America. Shares have hit an all time high and are likely to head higher with the expansion plans and increased same store sales. This pick I am proud of and see it heading higher for the rest of the year.
The chart shows slight drops in March and May, but otherwise, it has a nice steady upward path. Shares are likely to continue this trend as they build more stores and pick up more members.
10. Sirius (NASDAQ:SIRI)
Start: $1.63
End: $2.19
Gain: 34%

Sirius shares have had a good run up in 2011, hitting a new level not seen since 2008. The stock hit $2.44 a month ago. Shares have climbed from good news, including a debt rating upgrade. Shares are also likely to increase with the new Sirius 2.0 coming soon. The company has done a good job at staying competitive in the radio industry. I believe shares will double from the initial time I purchased them. I have owned shares since $1.69, and despite several analysts saying to dump them at the peak it hit last month, I continue to hold and wait for the double. I will likely sell half my stake when it doubles and hold the rest in this valuable company.

The chart shows that shares have dropped from their 52 week high reached at the end of May. Shares are already back on an upward trend and look like they might beat the resistance when they get there, creating a new high price.
Honorable Mentions
Boeing (NYSE:BA)
Start: $65.26
End: $73.93 plus $0.84 in dividends $74.77
Gain: 15%
Coach (NYSE:COH)
Start: $55.31
End: $63.93 plus $0.375 in dividends $64.31
Gain: 16%
Discovery Communications (NASDAQ:DISCA)
Start: $41.70
End: $40.96
Gain: -2%
Fortune Brands (FO)
Start: $60.25
End: $63.77 plus $0.38 in dividends $64.15
Gain: 6%
Liveperson (NASDAQ:LPSN)
Start: $11.30
End: $14.14
Gain: 25%
Madison Square Garden (NASDAQ:MSG) Read My Full Review Here
Start: $25.78
End: $27.53
Gain: 7%
Smart Technologies (NASDAQ:SMT)
Start: $9.44
End: $5.70
Gain: -40%
My Top Ten picks as a whole are down 46% for the first half of 2011. This is an average of -4.6% per stock. I only have three stocks in the black, while six remain down for the year, and one flat. It will have to be a good second half of the year for my picks to continue my market beating streak with these top ten stock picks. I still believe in all of my stock picks. Out of all the stocks listed, I own only Sirius shares. I continue to watch all the stocks listed. I am a small time investor, so the cheaper share prices are easier for me to accumulate and cut my cost basis down. I like SMT and DWA shares, as they are down at a 52 week high right now. Please consider doing your own due diligence before investing, and keep in mind I am not a certified financial analyst. My original top ten picks article was loaded with criticisms, so please try to stay positive with your comments or professional with criticism. Thanks for your continued readership.
Disclosure: I am long SIRI.