3 Best Buys Now

The following video is part of our “Motley Fool Conversations” series, in which analyst John Reeves and advisor David Meier discuss topics across the investing world.

For John and David’s real-money, 10-Bagger portfolio, they see Denbury Resources, InvenSense, and LinkedIn as the three best buys right now.

Denbury Resources continues to increase oil production. It doesn’t carry the burden of natural gas production like Chesapeake Energy and is pricing in $60-$65 oil. That’s unlikely to happen soon, which makes the shares attractive today. InvenSense sees lots of growth ahead of it. It’s putting motion sensors in smarthphones, tablets, and now screwdrivers. Shares have pulled back recently, making it a good time to buy. LinkedIn has put up some monster numbers. The professional networking company has a strong business model that will get stronger as more people join the network. It’s worth picking up a few shares today. And as a bonus, investors may want to take a look at EnerNOC  (Nasdaq: ENOC  ) . The demand response company for electrical utilities seems to have put a squabble with its largest customer behind it, paving the way for future growth.

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David Meier owns shares of InvenSense. John Reeves has no positions in the stocks mentioned above. The Motley Fool owns shares of Denbury Resources, EnerNOC, InvenSense, and LinkedIn and has the following options: long JAN 2013 $16.00 calls on Chesapeake Energy, long JAN 2013 $25.00 calls on Chesapeake Energy, long JAN 2014 $20.00 calls on Chesapeake Energy, and long JAN 2014 $30.00 calls on Chesapeake Energy. Motley Fool newsletter services recommend EnerNOC and LinkedIn. 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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  • Report this Comment On August 29, 2012, at 8:35 PM, jimmy4040 wrote:

    ENOC

    Stock up about 66% in a month. All other metrics down year over year. Obvious manipulation by somebody, just like Goldman with MAKO.

    You'd have to be a compelte idiot to buy this stock right now

  • Report this Comment On September 01, 2012, at 8:19 AM, maniladad wrote:

    Hi again, John. More comments on INVN: Steven Nasiri, the Founder, CEO, President and Secretary of INVN apparently got 9 million shares when the company went public in Nov 2011. As I noted earlier his salary is 'only' $645K so it may not be too surprising that he sold a little under 300K shares 2 days later. (He got another 673K shares from the non-open market 4 days after that.) Also understandable that he sold 1.3 million shares in March and even that he sold 15K on 6/18/12, 5K on 6/19 and 50K on 7/25. What puzzles me is why he sold exercised stock options in lots of 5000 shares each on 8/2, 8/3, 8/6, 8/7, 8/15, 8/16, 8/20, 8/21/, 8/27 and 8/28. The total for the last group is only 50K but why the unusual pattern? I've never seen anything like it.

    There were a couple of other things that I noticed that I don't understand. For the past 3 years capital expenditures have run a bit over $2 million dollars a year but 'property, plant and equipment' have only increased by about $400K per year, leaving a discrepancy of about $2M per year. Do you know where it went?

    Another thing that may be one of those bookkeeping quirks that I've never understood is that the bulk of their increase in cash and cash equivalents in the last annual report came from $77 million worth of 'cash from financing' and yet they have only $42K in debt. I'd like to know how to do that myself.

    I also noticed that over half, 56%, of the net income in the 2012 annual report went to preferred shares and in previous years the proportion was even higher, 83% in 2011 and 81% in 2010. Could that be a problem in the future?

    Finally I see that Mr Nasiri has founded and sold at least 4 previous MEMS companies in the past. I don't know how shareholders fared in those transactions. Do you have any information on this? Is there any danger of market saturation in the sale of MEMS companies? What about MEMS chips? Obviously INVN is not the only company making them.

    On a different note I see that the stock price has swung widely since the company went public and that it has fallen to a price of about 9.50 before rebounding, on a sudden increase in volume, although each time to a lower high. Since the overall trend since March has been downward and with the present price in the mid 12's, are you sure that now is the best time to buy?

    For the record, I have an standing order for a modest number of shares of INVN at a modest price. But there are still a lot of things that don't seem quite right to me and I'd appreciate your insight.

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