Keeping your portfolio above water in these markets is no easy task. Companies can be too easily whipsawed by the whimsical musings of the Treasury Department or the Fed, making investors who've successfully navigated these rough waters rare indeed. A steady track record of staying afloat is even more impressive.
The All-Stars in our Motley Fool CAPS investor intelligence database have found themselves particularly adroit at consistently steering their picks through these turbulent markets. Let's look at some of the recent picks of this community's longtime investing mavens. If these All-Stars have been able to maintain their top status through bull and bear markets alike, their opinions on stocks for the months and years ahead might be worth watching.
|
CAPS Member |
Member Since |
Recent Stock Pick |
CAPS Rating (5 Stars Max) |
Call |
|
|---|---|---|---|---|---|
|
99.70 |
6/8/06 |
Akamai |
***** |
Outperform |
|
|
99.70 |
10/18/06 |
Mylan |
***** |
Outperform |
|
|
99.73 |
9/14/06 |
Goldman Sachs |
*** |
Underperform |
|
|
99.67 |
10/12/06 |
Research in Motion |
*** |
Outperform |
|
|
99.69 |
9/13/06 |
DryShips |
** |
Outperform |
Rowing against the current
For successful Internet websites, content is king -- especially in a recession. That may be why content delivery firm Akamai Technologies was able to turn in good fourth-quarter results -- and turn the heads of jaded analysts who've upgraded its future potential. The only investors who have been disappointed by Akamai are those seeking to buy the stock at a deep discount.
Akamai doesn't produce content; it just helps client websites distribute it quickly. That's why its customers include some of the biggest content producers in the world, including Amazon.com
Digital delivery has been profitable for Akamai, helping the company generate a 69% increase in free cash flow last year. But a number of pretenders to the throne now want their own cut of that embarrassment of riches. Limelight Networks was able to siphon off some business from Apple, while BitGravity scored with Tata Communications.
Some analysts see a cloud for every silver lining. Goldman Sachs, for example, underscored Akamai's leading position, but also suggested that bookings weren't as potent as the company's earnings report and guidance would indicate. Moreover, Goldman thinks that increasingly fierce competition for content delivery endangers Akamai's premium valuation.
At 23 times last year's earnings, Akamai certainly seems richly valued. Yet if you look at the Internet information-provider industry as a whole, Akamai seems priced right in line with its peers. It does sport a premium to some companies in the space, such as Digital River. But others, such as VeriSign, trade for nearly twice its multiple.
Investors haven't lost any confidence in Akamai. CAPS All-Star member tickertale ultimately predicts the content-delivery firm will make a run at $30 per share soon. Meanwhile, lcashdol1 simply thinks clients will keep swarming to Akamai to more economically achieve common goals:
I think with the weaker economy companies looking to expand or shore up there web presence will look to Akamai for a cheaper solution then adding servers to there infrastructure. I also think video is booming and will continue to grow.
Ahoy there!
Whether you've been in the markets for years or are new to them, it pays to start your own research on these stocks on 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. Then share your views with the CAPS community on whether these old salts still have the wind in their sails.
