Over a year ago, I attempted to help out family and friends by creating what I considered an ideal growth portfolio.
If, during 2012, you had invested in the S&P 500, your investment would have returned 15.9%, after factoring in dividends. That's actually outstanding. And yet, had you been invested in the "World's Greatest Growth Portfolio," you would have trounced the S&P 500, earning a 26.5% return on your investment.
Before 2013 began, I decided to review all of the companies to see which ones still made the cut, and which didn't.
The chart below shows how the 2013 portfolio has performed so far. Taken as a whole, The World's Greatest Growth Portfolio has returned 35% since inception, besting the S&P 500 by 15 percentage points. Click on any company, and you can read about why it was selected for the portfolio.
Read on and you'll see which three stocks I think are exceptional buys, and at the end I'll offer up access to a special premium report on one company that deserves your attention.
|
Core Company |
Allocation |
Jan. 1 balance |
Current balance |
Change |
|---|---|---|---|---|
|
11.5% |
$115.00 |
$124.09 |
7.9% |
|
|
11.5% |
$115.00 |
$122.82 |
6.8% |
|
|
11.5% |
$115.00 |
$121.67 |
5.8% |
|
|
11.5% |
$115.00 |
$121.67 |
5.8% |
|
| Tier One Company | ||||
|
7.5% |
$75.25 |
$78.71 |
4.6% |
|
|
7.5% |
$75.25 |
$64.41 |
(14.4%) |
|
|
7.5% |
$75.25 |
$88.12 |
17.1% |
|
|
7.5% |
$75.25 |
$73.97 |
(1.7%) |
|
| Tier Two Company | ||||
|
3D Systems (DDD 1.44%) |
5% |
$50.00 |
$54.20 |
8.4% |
|
5% |
$50.00 |
$53.90 |
7.8% |
|
|
5% |
$50.00 |
$49.00 |
(2%) |
|
|
5% |
$50.00 |
$51.40 |
2.8% |
|
|
5% |
$50.00 |
$45.30 |
(9.4%) |
|
|
|
||||
|
Year-to-date |
$1,000.00 |
$1,049.26 |
4.9% |
|
|
Returns Since Inception |
35% |
|||
Source: Fool.com. All returns accurate as of market close, Jan. 31, 2013.
During the month of January, this portfolio definitely took a hit when big names like Apple stumbled after its earnings report. Though I think the company is extremely cheap right now, it didn't make the list this month, as I'm looking for proof the company can continue to innovate in the post-Jobs era.
3 best buys now
First on my list of best buys for your money right now is Baidu. I've been talking up this company for quite a while now, and last night's earnings report did nothing to dampen my excitement. Even though the company is down as much as 9% today, I think we're seeing an extreme case of short-term-ism.
Let's review the year: Revenues increased 54%, earnings per share increased by 57%, the number of businesses using Baidu increased by 22%, and the average revenue from each of these business customers increased by 26%. By almost all measures, this company is on fire, and still has a growing audience to address in China.
So why is the stock down? It mostly has to do with the fact that investors are worried about rising expenses, and the ability of the company to capitalize on the mobile search market. Correct me if I'm wrong, but we've seen these concerns before with Google, and it hasn't slowed the company one bit. In the search industry right now, the potential is huge, and it's worth spending a little extra now to make a bunch more in the future.
Second on my list is 3-D printing company Stratasys. Yes, I know the company is expensive, with a P/E of almost 94. But over the past couple of weeks, both Stratasys and its duopoly partner, 3D Systems, have taken a hit. The interesting thing is, there hasn't been any significant news to account for such moves.
In the short term, the price may still fall more; but in the long term, I think with the acquisition of Objet, and the enormous potential of 3D printing, the recent pullback offers a nice entry point for investors.
Finally, I think Whole Foods' shares -- while not particularly cheap -- are worth buying now. I won't waste space here telling you why, as I just wrote about why I'm buying shares of the company for my Roth IRA here .
