$100 Stocks or Higher
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Date updated:06-27-2007
What's wrong with stocks over $100?
This is a list of the hottest stocks (as of 6-26-2007) that are $100 or more. Some of them are my current favorites and others are Jim Cramer's favorites.
I thought it would be interesting to have a unique portfolio strategy based mainly on the premise of per share prices higher than $100. Some people have the ignorant notion that just because a stock is trading at such a high price, the stock "too expensive."
Others simply think that having more shares is advantageous, even though current commission schedules ironically make buying stocks this way more costly for the trader. A 10% return on 10 shares of a $100 stock is $100, the same as 10% of 1000 shares of a $1 stock. Yet the commission will be higher to buy 1000 shares, and sometimes the bid/ask spreads of lower priced stocks are less favorable for the trader.
Obviously "expensive" or "cheap" is a factor of valuation and not per share price. I created this portfolio as an experiment to provide evidence for those uneducated people.
I think the stocks in this portfolio together make a good/safe long term investment. Of course holding a stock long term, i.e. 2 years or more, greatly increases one's odds at making $$$. This portfolio is somewhat diversified with the main exception that Goldman Sachs and Bear Sterns are in the same sector and 4 out of the 9 picks are Technology related. I think Goldman is probably better than Bear Sterns mainly because Jim Cramer is so adamant about it, but I have Bear Sterns in this portfolio because I feel it is very oversold as of 6-26-2007 and therefore presents a wonderful opportunity.
I did a quick scan today and found that there are currently 697 stocks at or above the price of $100. This portfolio isn't supposed to include all of them, but rather track the performance of some of my favorites. I feel that these stocks are very attractive and buyable at these levels.
Some other "expensive" stocks that I like and happen to believe are really good values right now didn't make the list because they are not quite $100 yet, but they might get there soon!
Valero Energy (VLO) $74.66: Great value play if you like refineries.
ConocoPhillips (COP) $75.80: If you like oil, one of the best values at current levels.
NYSE Euronext (NYX) $72.82: Maybe speculative, but it was $100 in March 2007.
First Solar (FSLR) $88.27: Up 260% in past 52 weeks; I avoid chasing stocks, but maybe they are on to something!
Some over $100 stocks that didn't make the cut and my reasons why:
1. Terra Nitrogen (TNH) $131.56 didn't make the list because I think that sucker is ripe for a dive bomb once the chemical/fertilizer stock chasing fad ends and when people realize that TNH is borrowing money to pay that attractive dividend. TNH is up 500% during the past 52 weeks.
2. Boeing (BA) $94.98 isn't on the list because it's too "loved" and had too much of a recent runup for my taste.
3. Chicago Mercantile Exchange (CME) $530.90 and
4. CBOT Holdings (BOT) $200.42 are too expensive for me for various reasons. BOT has the advantage of being a buyout target of CME. BOT is also sought after by InterContinental Exchange (ICE) $145.56 creating a steamy bidding war!
P.S. I hope these stocks never split because I love "expensive" stocks. I think it discourages day trading, and I prefer that my stocks don't get day traded! Kudos to Google for setting their IPO price so high; they had the right idea from the start!!
(Also, I do mention Jim Cramer a few times in this. My apologies to all of you who oppose him. His proclaimed investing time frame is 6 - 18 months which is intermediate term. He definitely caters to the momentum crowd. It's TV, what do you expect? I prefer a more long term time frame of 2 years or more.)
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GOOG
Google - $355.67
- -1.95%
- $357.50
Probably the best deal in this list, at least to me. If I could have only one stock, this would be it. Probably worth at least $650 to me right now. One of Jim Cramer's "4 Horsemen" (all of which are tech stocks).
-
GS
Goldman Sachs Grp - $115.06
- -5.18%
- $117.19
Investment Banks/Brokerages are cheaper than many bank stocks right now. Jim Cramer loves this one in part because he used to work there and he claims they are the best at what they do. I think at current valuations this presents a good value opportunity.
-
BSC
Elements Bg Sm Cp - $6.49
- -6.62%
- $6.71
Again, another bargain brokerage house. It is in here because I think it was especially oversold recently. Long term I'd have to go with Goldman though because of Jim Cramer's bias.
-
IBM
Intl Business Mac - $83.60
- -5.92%
- $87.00
IT consulting is a rapidly growing field right now. They are multinational and can profit from emerging nations, off-shoring and the "Global Economy."
-
AAPL
Apple Inc - $96.87
- +5.88%
- $97.27
They are coming out with great products and increasing their market share. Their marketing and branding is truly a Royal Flush. Just get Apple TV right guys, that kind of product has a future in my opinion. Only this low on my list because I would need it to pull back to about $95 to start buying it like crazy. Another one of Jim Cramer's "4 Horsemen."
-
SHLD
Sears Hldgs Corp - $53.42
- -4.33%
- $55.40
Jim Cramer claims Ed Lampert is the next Warren Buffett. Cramer also claims that if he could own only one stock this would be it.
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RIMM
Research In Motio - $48.65
- -3.71%
- $49.00
Not really my favorite because of the risk of competition, possibly even from Apple now, but like Apple, they have a huge market share following and are heavily entrenched. Also, Blackberrys are more of an enterprise business product and the iPhone is more of a consumer product. Yet another one of Jim Cramer's "4 Horsemen." Amazon (AMZN) is the final one.
-
CMI
Cummins Inc - $30.45
- -6.62%
- $31.36
(Close enough to $100) If you like machinery, this company is arguably a good value, although it's already up 68% over the past year, but from a stock chart technical analysis perspective this stock is still very strong. I think it's a better deal than Deere & Co. (DE) which incidentally is $120.57 presently.
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