Novice Investing - Stock to Watch

Date: Thursday 20th 2008f November 2008 04:17:12 PM

Stock to Watch - 09/22/2005

By: Novice Investing Staff

In investing, there are two basic components that investors should look for. What to buy and at what price. Deciding what to buy is the easiest part of the problem. Investors, of course, want to buy a well-run company with solid balance sheet and huge growth ahead. Investors seldom want a highly leveraged company with poor unappealing products in a declining industry. (Think: long distance company). Without the absence of price, investing becomes much simpler.

Heck if investing is that easy, then the Goldman Sach of the world will go bankrupt. Individuals can just pick any company they like and are rest assured of earning positive return from their investment. The truth is not that simple. You pay a price for something. For a well-run company, you pay more; just like you pay more to buy a Ferrari.

As investors, we should already know what companies we like to buy. The next task is to simply wait until the price is right. Therefore, it is important to create a list of stocks making new lows. You can use businessweek's screener to find a list of stocks making new lows. The Market has been dropping lately. A few lists came up that might interest you. Read on

Walmart Stores Inc. (WMT). Everybody knows Walmart. This is the most dominant retails in decades. It is huge and has the economies of scale to offer cheaper goods to consumers. The stock price recently touches 4 year low if we are not mistaken.

Fifth Third Bancorp (FITB), Flagstar Bancorp (FBC) We talked about bank stocks previously here. No wonder Fifth Third reaches 52 week low. It had been warning of a weak earning last week.

Fannie Mae (FNM) This company has accounting problem, but is really cheap right now. It is selling at $ 46 while Earning Per Share (EPS) estimate is $ 6.68.

NewYork Times (NYT), Knight Ridder Inc. (KRI), Gannett Inc. (GCI) We lump these companies together as they are all in the publishing business. They all own various newspapers around the country and are feeling the heat to internet advertising.

Pier 1 Imports Inc. (PIR). PIR reaches another low this week. This struggling retailer try to right the ship by offering the right merchandise to consumer.

Verizon Communications (VZ) Verizon has high debt load but it offers 4.9% dividend and is currently profitable. It is not as volatile as others but if it drops precipitously, it might be worth a buy.

Now, hopefully, the list helps you identifying your potential investment. Please do your due diligence carefully. Some of them may not be a good investment no matter how low the stock price falls.

END

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Disclaimer: The sole purpose of this article is educational. This article is merely the opinion of the writer and is not in any way a buy/sell recommendation regarding Walmart Stores Inc. (WMT) or other securities.

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