Investing is all about choosing the right time to purchase the best possible stocks. When there are so many potential investments you can pick from, it can be quite difficulty trying to decide what stock(s) you should be most interested in.
To help your decision making process easier, we are looking at three stock ideas to think about for your own portfolio. Take a look at all three ideas and see which one you think fits best with your own investing goals.
If you like companies that have a strong balance sheets, a good plan for growth, a fat dividend yield, and savvy management teams then you might want to have a closer look at General Motors. Since the dark days of 2009 when it landed in bankruptcy court after being mismanaged for years to today – GM has come a long way
GM’s bankruptcy let it get rid of huge amounts of debt and surplus capacity, and that combined with the good work it had begun to do to improve its products and cost structures meant it quickly gained momentum.
The result is that today’s GM has a high credit rating, rock-solid balance sheet, and a thick profit margins, not to mention the solid dividend currently yielding 5.1%.
Certain sectors over time go in and out of popularity and in recent years the financial industry has been suffering a downturn.
Doubt about the health of the economy and the direction of interest rates in the future has held back Wells Fargo shares as well as other big banks. Yet with Wells Fargo, the bargain prices creates an alluring opportunity for investors that are seeking value.
Wells Fargo is perhaps the strongest banking franchise in the US; however, its stock trades at less than 11 times forward earnings estimates and it has a dividend yield above 3%.
The bank is focused on the domestic market for mortgage, business loans, and credit card has worked well because of the outperformance of the US economy compared to that of the rest of the world, with a solid margin of 2 – 3 percentage points between its return on equity and its cost of capital, Not only are Wells Fargo’s fundamentals healthy, they are considered outstanding among the largest banks in the country.
The Mosaic Company
In recent months the steep fall in fertilizer stocks has provided some astounding opportunities for long-term investors. Currently, The Mosaic Company is one of the world’s leading producers of two important nutrients: potash and phosphate.
In the past year, Mosaic has lost as much as 40%, and currently their stock is now trading at an all time low valuations of under 10 times trailing earnings, only 0.92 times its book value, and 7 times its cash flow. Comparatively, it’s closest rival would be Potash Corporation of Saskatchewan, which is trading at a P/E of nearly 15 and 1.71 times its book value.
While Mosaic’s valuation seems attractive, its business has just as compelling long-term prospects. The fertilizer markets might not be in its best shape, but fertilizer continues as an integral agricultural product for boosting crop productivity – as the world’s population grows, something the world will need to fall back.