I follow quite a lot of companies, so the usefulness of a watchlist to me cannot be overstated. Without my watchlist, I'd be unable to keep up on my favorite sectors and see what's really moving the market. Even worse, I'd be lost when the time came to choose which stock I'm buying or shorting next.
Today is Watchlist Wednesday, so I'm discussing three companies that have crossed my radar in the past week -- and at what point I may consider taking action on these calls with my own money. Keep in mind that these aren't concrete buy or sell recommendations, nor do I guarantee I'll take action on the companies being discussed weekly. What I can promise is that you can follow my real-life transactions through my profile and that I, like everyone else here at The Motley Fool, will continue to hold the integrity of our disclosure policy in the highest regard.
Goldcorp (NYSE: GG )
I have a hard time finding reasons not to like one of the cost-of-production leaders in gold mining, but Mr. Market hasn't exactly seen it that way.
The mining sector as a whole is undergoing a major transformation that has included significantly higher labor costs, rising fuel costs, and incredible build-out and maintenance inflation. For Goldcorp, it's also dealt with delays, such as with its cash-cow Penasquito mine, which it blamed on inadequate water supply. The Penasquito mine is projected to contain 16 million ounces of gold.
Goldcorp has been a leader in keeping its costs down for years, relying on by-product metal sales to drive down its cash costs and producing some of the healthiest margins in the industry. Thanks to strong silver by-product sales, Goldcorp's cash cost per ounce of gold was negative $608 as gold production soared 126% over the previous year. That's also great news for royalty interest company Royal Gold (Nasdaq: RGLD ) , which has a contract in place that gives it 2% net smelter royalties on mine production. Overall, Goldcorp really is in a class of its own, and it's looking like an attractive value with gold still near its highs.
Intuitive Surgical (Nasdaq: ISRG )
Oh, here's a shock: Intuitive Surgical crushed Wall Street's expectations two weeks ago. Allow me to point out that the naysayers continue to berate the valuation on Intuitive Surgical and it just keeps topping those estimates regardless of the rhetoric.
For the third quarter, Intuitive reported a 50% rise in year-over-year profit as revenue rose 20%. The key to Intuitive's ongoing success relates to a mixture of leading innovation, healthy recurring revenues, growing procedure and service revenue, and a lack of true competition. Many surgical robotic device companies have tried to emulate Intuitive Surgical and failed miserably. Both Hansen Medical and, more recently, MAKO Surgical (Nasdaq: MAKO ) have seen sales of their devices limp out of the gate when many expected an explosion. That isn't to say these two may not eventually pose a viable challenge, but the fact remains that they're still a long way off from being a genuine threat to Intuitive Surgical.
Intuitive remains one of the few health-care-sector companies I continue to stand behind almost regardless of price because of its leading innovation and crazy pricing power.
NVIDIA (Nasdaq: NVDA )
Although I don't talk about graphics-chip manufacturer NVIDIA much, don't assume for a moment I don't have my eye closely on this dominant long-term play in the smartphone and tablet market.
NVIDIA's biggest detriment at the moment is that we're in the midst of a tech cycle update for numerous smartphone and tablet producers, and numerous consumers have cut back on their spending in recent months. Both factors have constrained NVIDIA's pricing power and led to weakness in the stock.
However, the long-term outlook, while remaining cyclical in nature, does look promising. As my Foolish colleague Tim Beyers pointed out on Monday, NVIDIA stands to be a big winner from the new Microsoft Surface, as its 1.4 GHz processor is the brains of the tablet. NVIDIA also stands to benefit even further in the graphic card market as AMD's struggles have led it to back off its research and development spending. NVIDIA has $3.26 billion in net cash and is trading at just 11 times forward earnings; needless to say, it should definitely be on your Watchlist.
Is my bullishness or bearishness misplaced? Share your thoughts in the comments section below and consider following my cue by using these links to add these companies to your free, personalized watchlist to keep up on the latest news on each company:
MAKO Surgical may not appear to be a challenge to Intuitive Surgical at the moment, but it could present challenges over the long term. If you want the full, in-depth, scoop on MAKO Surgical, including the opportunities and threats facing the company, click here and you'll gain access to our latest premium research report on MAKO Surgical -- as well as get regular updates for a full year.