Well, how has 2011 treated you, dear Fool?
If you're like most investors, you aren't sure if the market's heading up or down in the coming months. A recent survey by the American Association of Individual Investors shows that investor uncertainty -- as measured by a neutral outlook on the market -- is at a six-year high.
But here at the Fool, we encourage you to regularly invest in the market, no matter the outlook. No one can tell the future, and by following a regular schedule of investing, you'll catch all the ups -- and downs -- the market has to offer.
For the past few months, I've been publishing how I go about choosing my regular investments. I'll review five stocks I'm considering buying, and I'm backing up my picks by making CAPScalls on my profile for all five of these stocks. Tune in Tuesday, when I'll be picking one to add to my Roth IRA next week.
If you've ever read Clayton Christensen's work, you know about the power of disruptive innovations. IPG Photonics, which makes lasers used for industrial applications, is one such innovator. Instead of offering the typical carbon-based laser, IPG has pioneered the optical-fiber laser, which is cheaper and more powerful than traditional lasers.
The company has also brought the entire manufacturing process of its components in-house, which means that it doesn't have to source out components used in the lasers like potential competitors.
Shares are off their 52-week highs by an astounding 52% , largely because any slowdown in the economy would lower demand for the company's lasers. While I'll admit that a slowdown would hurt this investment, I think any investor with a 10-year timeline will be richly rewarded.
- Add IPG Photonics to My Watchlist.
Even though shares of MAKO are a full 30% off of their yearlong highs, the company is still up over 75% on the year. This is largely due to the adoption of the company's Rio System, which allows for minimally invasive repairs to compartments of the knee instead of full-on knee replacement.
With the FDA having just approved the use of MAKO products for hip replacements as well, there's tons of potential for MAKO Surgical in 2012 and beyond.
- Add MAKO Surgical to My Watchlist.
Investing in Chinese companies can be a dangerous game. Last year, I was interested in purchasing shares of fertilizer company Yongye
Surely, we'd have better luck with Chinese e-tailer Dangdang
However, in Baidu -- aka the "Chinese Google" -- I think I've found a worthy investment in the Far East. It has proven doubters wrong in the past, and won them over as converts. Though I fully realize the concerns with the Chinese economy slowing down, there are still hundreds of millions of Chinese citizens waiting to join the World Wide Web. With shares down more than 25% from their highs, I think now could represent a solid entry point.
- Add Baidu to My Watchlist.
I recently highlighted my bull case for Aflac elsewhere, so I'll give the Cliff's Notes version here.
Aflac's underlying business of supplemental life insurance is doing well, particularly in Japan, where more than 80% of revenues come from. But it's the investment portfolio of Aflac that has investors spooked: It recently sold off its positions in Greek and Portuguese banking debentures and sovereign debt to the tune of a $1.1 billion loss.
Institutional investors don't seem to be comforted by this de-risking move. Shares are now trading low enough that the company offers a 3.2% dividend, while only having a 30% payout ratio. Should things stabilize in Europe, shares of Aflac could go flying.
- Add Aflac to My Watchlist.
A.T. Cross Co.
I came across this company while tinkering with various screens this past week. Cross' main line of business is in offering high-end office equipment, particularly its expensive and high-quality pens. Recently, the company has expanded its offerings, with its Native and Costa brands of polarized sunglasses and goggles.
A quick look at the numbers reveals an interesting situation: Shares are trading hands at 18 times earnings, while revenue and earnings per share have grown 14% and 33%, respectively, over the past year.
- Add A.T. Cross to My Watchlist.
Our top stock for 2012
Now that you know what five stocks I'm considering adding to my portfolio, I encourage you to continue searching for the next great stock for 2012 by checking out our special free report: The Motley Fool's Top Stock for 2012. Inside you'll find out about a company that has all the greatness of Costco baked into its DNA, but operates in the quickly growing economies of Central and South America. Get your copy today, absolutely free!
Fool contributor Brian Stoffel owns shares of Costco, MAKO, Aflac, and IPG Photonics. You can follow him on Twitter at @TMFStoffel. The Motley Fool owns shares of MAKO Surgical, Yongye International, Aflac, and IPG Photonics. Motley Fool newsletter services have recommended buying shares of Aflac, MAKO Surgical, Baidu, Yongye International, and IPG Photonics. 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.