The article provides a comprehensive guide of some attractive stocks with the potential to double in price. The article will serve as a guiding tool for new investors who are unaware of the potential good buys. In the present time of market slowdown it is tricky to make a decision about buying out a profitable stock; hence, this article is written to help the new investors.
SIRIUS XM Radio Inc. (SIRI):
SIRIUS XM Radio Inc. (SIRI) is a good buy since it’s ahead of its competitors like Cumulus Media Inc. (CMLS) and Westwood One Inc. (WWON) in terms of forward price earnings ratio and market capitalization. SIRI is promising if one would like to invest in this sector as it is the market leader in terms of profit. SIRI has substantially higher price earnings ratio (ttm) of 41.95 as compared to CMLS and WWON.
The earnings per share (ttm) ratio is 0.04 over the last four quarters which is higher than WWON which has an earning per share of -0.69 over the last four quarters. CMLS offers an EPS of 0.81 which is the highest in the industry. However, the investors who are interested in dividends will be disappointed as the stock doesn’t have a history of paying dividends in the last year.
SIRI is a strong buy during the current period as it will offer promising returns in the future. The S&P forecasts a 10.7 % growth in the future as well as a forward P/E ratio of 12.4. Therefore, it will be beneficial to go long on this stock as it will give returns in future.
Sanofi (SNY) last traded on NASDAQ at $1.05 close to its 52 week low. The stock was not volatile during the day and there was minimum fluctuation from the start to the end of the day. The trend is slow for the stock and it is trading close to the 52 week low which indicates it as a potential buy for long term investors. The pharmaceutical industry is a growing sector in the future. It is due to the overall bearish market condition that stocks are moving slow.
SNY has 52 wk range of $0.96 - $2.75. SNY went down by 42% at the end of July 2011 as the parent company announced that SNY could not production targets. The competitors like Abbot Laboratories (ABT), ACADIA Pharmaceuticals Inc. (ACAD) and 3SBio Inc. (SSRX) have P/E ratios of 15.61, 3.33 and 23.58 respectively. The stock price has been rotating around the 52 week high and low for SNY.
Similar case can be found with 3SBio Inc. SSRX (Current: $12.97 High: $ 20 Low: $ 12.74), Abbot Laboratories (Current: $51.04 $51.04 High: $ 54.24 Low: $ 45.07) and ACADIA Pharmaceuticals Inc. (Current: $1.30 High: $ 3.30 Low: $0.65).
Contango Oil & Gas Company Comm. (MCF):
The energy sector has always been an attraction for the investors. Unfortunately with the current situations of the market, this sector too has shown a slowdown. Its stock closed at $ 57.95 when last traded. However, the position is better than the competitors like TULLOW OIL (TUWOY.PK) and PREMIER OIL (PMOIY.PK) which faced serious fluctuations during the day and went down by 3.33% and 4.35% respectively. MCF’s P/E (ttm) ratio is average relative to the industry as whole. MCF’s 52 week range is 44.94 - 67.25.
There are no direct competitors for MCF but the close competitors such as Apache Corporation (APA) and CNOOC, Ltd (CEO) are better buys in terms of growth and long term investment. MCF has a P/E ratio of 14.3% as compared to the industry average of 22.3%. The EPS (ttm) over the last year is 4.14 which is better than the EPS (ttm) of PMO.L and TLW.L which is 0.31 and 0.32 respectively.
Cincinnati Bell Inc. (CBB):
The telecom sector has always been an attractive buy for investors. Cincinnati Bell Inc. (CBB) stock tumbled down when it last closed. It has a P/E (ttm) ratio of 35.00 whereas the competitor AT&T (T) has a P/E ratio of 8.17. The EPS (ttm) of CBB is 0.99 while T stands at an attractive 3.44.
However, as compared to Sprint Nextel Corporation Comm. (S) who’s EPS (ttm) is -1.05 and showing a negative profitability, CBB is doing well in terms of profitability. CBB’s stock is currently undervalued, hence, expected to rise in future. The beta of CBB is 1.5 which suggests a neutral position and stock holders should hold the stock for a while. The company’s YTD Return is 13.93% while the operating margin is 21.74%. The 52 week range is 2.31 - 3.64 and the stock last traded at 3.08.
The stock slowed down by the end of the day. The P/S (ttm) of CBB is 0.42, therefore, it’s the investors call to invest in the stock and the holders of stock should hold the stock for a bit more time.
Arcos Dorados Holdings Inc. (ARCO):
Arcos Dorados Holdings Inc., the Latin American holding company for McDonald's is performing quite well. After its IPO in April 2011, the company has performed commendably well despite the economic situation and has performed better than other stocks in the market.
ARCO has a forward P/E ratio of 35.95 which is financially sound. The future growth over the next five years is expected to be 27.7% which is a good indicator. The profit margin is 3.6% while the debt holding is 80% for the company. ARCO is currently trading near its 52 week high at $27.06.
The dividend rate is 0.0597 while the yield is 0.22% which is good for amateur investors. ARCO is a pretty good investment for new investors as the company shows a promising future. Brazil Fast Food Corp. (BOBS.OB), a close competitor of ARCO has an EPS (ttm) of 1.27 and P/E (ttm) of 9.55. In current situation, ARCO’s stock should be bought.
Disclosure: I have no positions in any stocks mentioned, and no plans to initiate any positions within the next 72 hours.