5 "Buy Now" Stocks From Motley Fool Analysts

It's not often that you get to see, in real time, how some of the analysts you follow are performing. With our CAPS system, that's now possible. Even more rare is the ability to get real-time updates on what analysts are buying and selling -- all for free.

But that's exactly what we offer at The Motley Fool, through our Real-Money Stock Picking program. Eleven of the Fool's in-house analysts are making real purchases with the Fool's money. I've highlighted five of those buys made in March, and the reasoning behind them. At the end, I'll offer up access to a special free report on one company Warren Buffett wishes he could buy... but can't.

Two energy plays
When Superstorm Sandy hit last year, millions of Americans were left without power for days. It offered a humbling reminder of how reliant so many of us are on the nation's power grid. Though my wife and I live in the Midwest and avoided the worst of the storm, we have family that lives in the Northeast and was right in the middle of it.

One prescient uncle in particular became a neighborhood hero when his not one but two generators were lent out to neighbors when they were needed. It's that type of thinking that led analyst Jim Mueller to buy shares of Generac Holdings (NYSE: GNRC  ) .

The company, which makes generators of all sizes, has been around for nearly 50 years, and has a 70% market share of home standby generators. As Jim rightly points out, our nation's electrical grid isn't getting any younger; and even though improvements will surely be made, it won't be without delays and political grandstanding.

As it is, outages are becoming all the more commonplace, meaning that Generac's products could be in increasing demand.

Source:  Electric Disturbance Event annual reports, Office of Electricity Delivery & Energy Reliability, DOE. 

The other energy company on our analysts' radar was Apache (NYSE: APA  ) , a natural gas and crude oil company. Fool analyst Paul Chi, after carefully considering what he heard from Apache's analyst day presentations, thinks now is the time to buy shares

Specifically, Paul is excited that the company has signaled, in no uncertain terms, that it is going to start drilling more wells across the swath of its balanced worldwide portfolio.

This build-out will help the company achieve its goal of 1 million barrels of oil per day by 2016. While I think that's encouraging -- as is the fact that the company is trading for a cheap seven times forward earnings -- I tend to stay away from investments that are so prone to commodity price swings.

Time to buy into banks
Along with the energy sector, our analysts were busy buying up shares of bank stocks as well. But if you're looking for big-name banks, you're out of luck. Our analysts are digging much deeper to find their favorites.

Fool analyst Anand Chokkavelu recently discussed why he's buying shares of Missouri-based Great Southern Bancorp (NASDAQ: GSBC  ) . When it comes to small banks, it can be difficult to measure soft variables like company culture and service, so Anand instead focuses on "banks that have strong operations, conservative lending, good dividends, and low price tags." 

Currently, Great Southern only has 0.9% of its loans non-performing, signaling strong, smart, conservative lending practices. With a 2.9% dividend and a P/E ratio of 7.7, Great Southern simply fills out what Anand is looking for.

And Anand wasn't alone in looking for bank deals. Foolish counterpart Jim Royal believes that  shares of TFS Financial (NASDAQ: TFSL  ) could double in the not-so-distant future.

Jim likes to focus on stocks in special situations, and he sees just that in TFS. Specifically, the company simply has tons of cash on hand -- cash that it intends to give back to investors. In fact, as Jim states, "TFS has so much capital that it could buy every share that trades publicly!" 

Though there are some hurdles to clear before it does so, Jim believes sizable share repurchases and dividends are in the offing.

As for me, trying to understand the complex balance sheets of banks is beyond my specialty -- though that shouldn't stop you from diving in if it interests you.

One more for the road
The final stock for the month also comes from Jim Royal. This time, he purchased shares of Ryman Hospitality (NYSE: RHP  ) . Ryman focuses almost exclusively on providing hotels that allow for large conventions as well.

The special situation here is that, after converting from a REIT earlier this year, Ryman is planning on a special dividend as large as $2 per share and a buyback before the end of the year. It sounds like a good deal to me, but I'm more of a buy-to-hold investor, and this seems like too short-term a trade for me.

Looking for more underappreciated stocks
The price of becoming the world's greatest investor is that Warren Buffett can no longer make many of the types of investments that made him rich in the first place. Find out about one such opportunity in "The Stock Buffett Wishes He Could Buy." The free report details a sector of the economy Buffett's heavily invested in right now and exactly why he can't buy one attractive company in that sector. Click here to keep reading. 

Read/Post Comments (3) | Recommend This Article (10)

Comments from our Foolish Readers

Help us keep this a respectfully Foolish area! This is a place for our readers to discuss, debate, and learn more about the Foolish investing topic you read about above. Help us keep it clean and safe. If you believe a comment is abusive or otherwise violates our Fool's Rules, please report it via the Report this Comment Report this Comment icon found on every comment.

  • Report this Comment On March 28, 2013, at 3:14 PM, ThinkTrade wrote:

    Motley Fool is usually pretty good at analyzing stocks. But these are the kind of articles which will tarnish the Motley Fool brand.

    - Buy GE because more people are buying home generators? GE does $150 billion in revenue per year. Home generators are not going to move the needle.

    - Buy TFS Financial because it has a lot of cash on its balance sheet?

    - But Ryman because they have a special dividend and are buying back shares? Markets adjust for special dividends. 2. Buying back shares in nice, but is not very important in any greater sense.

    There is no mention at all about earnings, margins, or, more importantly, valuation.

    Motley Fool was created to transcend these types of amateurish, shallow articles.

  • Report this Comment On March 30, 2013, at 1:43 PM, steprightup wrote:

    I will have to disagree with Fool analyst, Jim Royal. With Ryman Hospitality, RHP, the dividend will more likely be a recurring theme at roughly $2 annually (potentially more in future years) versus a one time special. More likely to happen with share buybacks as management expressed, it will likely vary. The business model for RHP is main course for investment thesis. The industry has has fast a bit of a headwind for the past five years but pricing power for hotel rates should quickly result in time. Other kickers for RHP is that the still hold assets the potentially stand to be spun-off or sold as it is not part of the REIT theme. This may or may not happen but a bonus if it done. Given the current price, company is undervalued and with Intrinsic valuation, let's say $60 to $70, to grow at a minimum with GDP of 3%, not to include pricing power tailwind, annualized returns over 3 to 5 year period should be compelling.

  • Report this Comment On April 01, 2013, at 8:40 AM, TMFTortoise wrote:

    Hi ThinkTrade,

    In an article giving quick ideas for 5 different companies, it couldn't go into much detail. If you click through the links in the article, you'll be able to read each analyst's further thinking on why that company would make a good purchase today.

    And you might have been reading too quickly, because the one I bought was the small cap generator-maker Generac Holdings, not the mega cap conglomerate General Electric.


    Jim Mueller

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Related Tickers

9/28/2016 4:01 PM
APA $63.70 Up +4.11 +6.90%
Apache CAPS Rating: ***
GNRC $35.75 Up +1.06 +3.06%
Generac Holdings CAPS Rating: ***
GSBC $41.72 Up +0.24 +0.58%
Great Southern Ban… CAPS Rating: No stars
RHP $48.92 Up +0.99 +2.07%
Ryman Hospitality… CAPS Rating: *****
TFSL $17.94 Up +0.03 +0.17%
TFS Financial CAPS Rating: *****