Penny stocks are one way to double your money, though it's fraught with risk, but there are equally shiny opportunities trading at the other end of the price spectrum, too. I call 'em "three-digit stocks," but if they're anything like Berkshire Hathaway, they can trade in the four-, five-, and six-digit range, too.
A penny stock might not be a good buy simply because it's cheap, and a three-digit stock shouldn't scare you away just because it carries a hefty price tag. Handsome is as handsome does. Let's check in with the Motley Fool CAPS community to see which of the high-priced stocks below earn the greatest confidence from our investor-intelligence database:
Stock |
CAPS Rating (out of 5) |
3-Digit Price |
Return on Capital, TTM |
---|---|---|---|
MasterCard |
*** |
$194.40 |
49.7% |
NVR |
* |
$616.25 |
12.7% |
SPDR Gold Shares |
** |
$122.71 |
NM |
Source: Capital IQ, a division of Standard & Poor's; Motley Fool CAPS.
But just because these stocks are purring is no reason to jump into them blindly. Catching a tiger by the tail -- or a knife falling from on high -- can end up leaving you scratched and bleeding. That's why we recommend you use this list as a launch pad for your own research and analysis.
Highfalutin' honeys
Generating income from processing millions of small transactions has proved a lucrative business for MasterCard and Visa
But those are worst-case scenarios, and not everyone's convinced that what will be proposed will radically alter the landscape. And with issuers like JPMorgan Chase and Citigroup
Tearing down housing
Is the third time the charm? The possibility of a three-peat on the homebuyers tax credit is rearing its ugly head. As if the damage wrought by the first two attempts at having the taxpayer pay for a homebuyer's down payment wasn't enough, HUD floated a trial balloon on a third stab by saying it was "too early" to decide whether they should make another go at it.
Although the first two iterations of the program artificially boosted sales, the collapse in housing numbers since their expiration shows that all they've really done is pull sales forward. Homebuilders NVR, Beazer Homes
That sort of outlook helps explain why 56% of CAPS members rating NVR believe it will underperform the broad market averages.
Triple-digit titans
The sovereign debt crisis isn't going away, and investors holding ETFs trading on gold and silver prices like the SPDR Gold Trust and the iShares Silver Trust
Gold prices have been holding firm even as markets have traded higher because of worries that international financial institutions are going to have difficulties raising money. It's the lack of financial stability that has attracted investors like cdulan to the SPDR Gold Trust:
Gold is neither an inflation hedge, nor a deflation hedge, it is a financial stability hedge. As long as the Fed keeps interest rates at zero, the threat of financial instability will force the price of gold to rise slowly as investors anticipate a calamity.
The gold bugs have assumed Europe simply deluded itself when it allowed its banks to pass stress tests that ignored the value of sovereign debt they carried. As Greece and Ireland loom large again, being willfully ignorant of the dangers lurking there will cause gold's price to rise to even newer heights.
Count to 10
These three-digit stocks might be on their way to even higher valuations. That's why it pays to start your own research at Motley Fool CAPS. Read a company's financial reports, scrutinize key data and charts, and examine the comments your fellow investors have made, all from a stock's CAPS page.