In the midst of economic panic, there aren't too many lifelines to grab onto. Even the venerable Procter & Gamble (NYSE:PG) has fallen 16% from where it was a year ago. But with the S&P 500 index plunging more than 40% so far this year, a 16% loss doesn't sound quite so bad. More importantly, though, P&G's lineup of essential products like Old Spice antiperspirant, Pampers baby diapers, and Ivory soap are items low on most consumers' lists to cut out of the budget, meaning that P&G's financials should hold up pretty well during an economically slow period.
This stability is a big part of the reason that CAPS members have been so positive on P&G's stock. More than 5,000 CAPS members currently rate the stock an outperformer versus just 161 who think it will trail the broader market. But of all these P&G followers, no one has been on point with this stock like thomasgb. This member made two outperform calls on P&G -- the first was between May 2007 and April 2008, and the second was started in May of this year and is still open. Between the two calls, thomasbg has racked up a cool 56 points.
thomasgb has had a rough time with the stock market downturn, and the member's overall CAPS portfolio currently trails the market, though it does reveal correct calls on roughly 50% of the picks. P&G hasn't been the only great call. Here's a look at a few other prescient picks:
|
Company |
Date Picked |
Call |
Points |
CAPS Rating (out of 5) |
|---|---|---|---|---|
|
BB&T (NYSE:BBT) |
6/16/08 |
Outperform |
64 |
*** |
|
Visa (NYSE:V) |
3/20/08 |
Outperform |
33 |
**** |
|
ExxonMobil (NYSE:XOM) |
10/12/06 |
Outperform |
30 |
**** |
Data from CAPS.
So what is this investor looking at these days? Here are a few recent calls on CAPS:
|
Company |
Date Picked |
Call | |
|---|---|---|---|
|
Research In Motion (NASDAQ:RIMM) |
11/13/08 |
Outperform |
** |
|
Penn West Energy |
10/21/08 |
Outperform |
***** |
|
BP (NYSE:BP) |
10/16/08 |
Outperform |
**** |
Data from CAPS.
While not all of these picks may pan out, they could be a good place to start some further research. I decided to take a closer look at Research In Motion.
Motion in the wrong direction
If you're looking for something on the opposite end of the spectrum from Procter & Gamble, Research In Motion might be exactly that. As essential as most people find their cell phones -- and smartphones -- they hardly make the top of the list of what needs to be purchased.
RIM has been making a big push to steal from Apple (NASDAQ:AAPL) and its iPhone. For consumers, it's easy to put off a new smartphone purchase when it boils down to a choice between that or diapers for the baby (or at least I hope it is!). At the same time, as businesses start to struggle, they could put off upgrading the phones that their employees are using. These slowdown fears have shown themselves to be more than just fears, as RIM has now cut its fiscal third-quarter profit and revenue expectations.
There's reason to shrug off this pessimism, though, and take a look at RIM shares now. Cell phones and smartphones are one of the few areas of technology that are still growing at a snappy pace, and RIM is undoubtedly one of the companies at the forefront of the sector. Analysts' estimates for RIM's fiscal 2009 earnings will surely come down now that RIM has cut its own internal numbers, but even a substantially lower number than the current $3.54 estimate would make RIM's stock price look pretty cheap.
As you might guess from RIM's two-star CAPS rating, CAPS members haven't been overly positive on the stock. Esquiar84 is one of the CAPS members that does think highly of the company, recently weighing in: "With so many companies requiring cheap and effective mobile technology solutions, [Research In Motion] will continue to become the company who fulfills the wireless needs for corporations."
However, there are also quite a few who have a similar view to that of Ozzymendias, who recently gave RIM a thumbs-down, writing: "Research in stall. All that money flowing around to buy gadgets like theirs dries up in a recession."
But here's the important question: What's your take on Research In Motion? Will it find a way to bounce back, or will Mr. Market continue grinding it into the ground? Get in the action by clicking over to CAPS. CAPS is absolutely free and already has more than 120,000 stock pickers chipping in to find the best stocks out there.
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