Streetwise
Lauren Rudd
Sunday, December 6,
2009
Some Investment Picks for the Coming Year
They get on me and wanna know, Lauren why do you mention
healthcare.
Lauren why are you so liberal. Why must you live out what
you write?
Put yourself in my position.
If I write all night long it's a family tradition.
Over and over everybody made my prediction.
So if I try to right what’s wrong
I'm just carryin' on an old family tradition.
Apologies and thanks to Hank Williams, Jr.
Thanksgiving dinner is but a pleasant memory and the world
has officially kicked-off the holiday shopping season. Yet, for many there is
little respite from the repercussions of unemployment and/or the financial hell
resulting from inadequate health care insurance.
Consider John Brodniak, who suffers from blinding
incapacitating headaches due to cavernous hemangioma, an operable brain
condition that without surgery will kill him. John’s doctors will not operate
without his obtaining conventional health insurance, an obvious impossibility.
John qualified for Oregon Medicaid, but his doctors say the reimbursement rate
is too low so they will not operate. And these doctors can sleep at night?
Scrooge was a rank amateur.
John’s plight would not have entered into today’s column if
not for another simultaneous event, the receipt of a four page, full color
brochure with outsize smiling pictures of my local Congressman -- and no
meaningful text. In it he touts how he is working for health care solutions. His
record says the opposite.
Even that would not have resulted in my overwhelming ire had
I, as a cancer survivor, not been forced to play Russian roulette for the last
eight years. You see I too have been denied health care insurance. So is it any
wonder I carry on an old family tradition.
Meanwhile, greed, ignorance and stupidity on a cataclysmic
scale by Congress and Wall Street have led to an abominable economic and
investment environment. So here are a few kind words. Wall Street and Congress
have nothing against you personally. Neither knows whether you have been naughty
or nice -- nor do they care.
While you are on your own with Congress, you can overcome
Wall Street’s adversity. A prudent portfolio should enable you to exceed the
annual performance of the S&P 500 index by approximately 3 to 5 percentage
points. Longer term, you should be able to exceed the S&P’s 40-year average
return of 11 percent by the same 3 to 5 percentage points.
For those of you needing a little help or motivation to get
started, each year at this time I provide you with a dozen possible research
candidates and then review their performance following year.
Last year the suggestions were:
Best Buy (BBY 42.83,19.02,1.3)
Hasbro (HAS 29.34,25.50,2.70)
Hewlett-Packard (HPQ 49.07,35.28,0.7)
Intel (INTC 19.11,12.56,2.9)
Procter & Gamble (PG 62.48,60.49,2.8)
Clorox (CLX 60.05,56.63,3.3)
Briggs & Stratton (BGG 18.25,12.70,2.4)
Harley-Davidson (HOG 28.69,14.71,1.4)
General Electric (GE 15.94,15.50,2.5)
Mattel (MAT 19.57,12.59,3.8)
Microchip Technology (MCHP 26.05,17.18,5.2)
Kellogg (K 52.97,40.91,2.8).
The first number is the price on Nov. 27, 2009; the second
the price on Dec. 1, 2008 and the last the current dividend yield. The average
return for the 12 stocks is 43.24 percent with an average dividend yield of 2.65
percent. During the same period the Dow was up 26.52 percent and the S&P 500 was
up 33.73 percent.
And here are 12 suggestions for the upcoming year:
Badger Meter, (BMI), Best Buy (BBY), Church &
Dwight (CHD), Clorox (CLX), Coach
(COH), General Dynamics (GD), Joy Global
(JOYG), Kellogg (K), Microchip Technology
(MCHP), Stryker (SYK), Suburban Propane (SPH)
and Zimmer (ZMH).
Some caveats to keep in mind: Last year was atypical.
Furthermore, the 12 suggestions for this year are not an instant portfolio where
you add water and stir, nor are they a managed portfolio. Rather, they are
investment suggestions designed to keep you busy and away from the eggnog.
