Megan Fox, who played Sydney Shanowski on the TV series Hope and Faith, has rocketed to stardom recently for her role as Mikaela Banes in Transformers, for which she was nominated for a National Movie Award and a Teen Choice Award. Last year, FHM magazine voted the sexiest woman in the world.

Just last week, "Megan Fox" was one of the top 20 search items on Yahoo! (YHOO) and, according to IMDb.com, was up 57% in popularity, probably due to rumors that she would be replacing Angelina Joie as Lara Croft in the next Tomb Raider movie. Fox, however, has denied that she is interested in the role.

To play off of the actress's popularity, Stockpickr has created the Megan Fox Stock Index, a list of publicly traded companies connected to the actress via her film and TV roles, commercial appearances and other associations. Fox's index is down 12.6% since the beginning of the year, vs. a drop of 5.7% for the Dow Jones Industrial Average.

Fox appeared in a sexy General Motors (GM) Pontiac commercial, also known as the "Killer 3 Transformers commercial" due to its cross-promotion of the movie. GM has produced the Pontiac automobile brand since 1926. The auto manufacturer is planning on slashing white-collar jobs in order to keep the $13.4 billion in U.S. bailout assistance. GM even asked for a bailout from the government of Thailand, but the Thai Prime Minster Abhisit Vejjajiva turned the company down.

GM financials are in terrible shape, generating negative earnings of more than $38 per share. Although it has $15.9 billion in cash, GM's debt load is $45.2 billion. Book value is a negative $98 per share. Operating cash flow is a negative $5.8 billion per share.

General Motors is favored by Bill Miller, the portfolio manager of Legg Mason Value Trust and the only mutual fund manager who has beaten the S&P 500 for 14 years in a row. He primarily invests in large-capitalization stocks at large discounts to his assessment of their intrinsic value. Miller also likes Google (GOOG), which has a price-to-earnings ratio of 28; Amazon.com (AMZN), with a P/E of 45; and Yahoo! (YHOO), with a P/E of 45.

Fox's success in Steven Spielberg's Transformers benefited the movie's distributor, Paramount Pictures, a subsidiary of Viacom (VIA.B), the entertainment conglomerate. Since the film grossed more than $700 million, making it the 30th most successful film ever released and the fifth most successful film of 2007, Paramount is coming out with a sequel, Transformers: Revenge of the Fallen, with Fox repeating her starring role. Barclays recently upgraded Viacom to overweight with a price target of $20. Viacom has a favorable P/E of 6. It has a significant amount of debt at $9 billion, with only $525 million in cash. Operating cash flow is $1.3 billion, and the company doesn't pay a dividend.

Viacom stock is owned by Citadel Investment Group, one of the world's largest hedge funds, which was founded by billionaire trader Kenneth C. Griffin. Its trading volume is huge, amounting to 1% to 2% of daily trading activity in New York and Tokyo. Citadel also owns McDonald's (MCD), with a P/E of 15; JPMorgan Chase (JPM), with a P/E of 20; and Apple (AAPL), with a P/E of 19.

Fox was also a Disney (DIS) star, appearing in Confessions of a Teenage Drama Queen and Crimes of Fashion. ABC's Hope & Faith also falls under the Disney umbrella. Disney has a P/E of 9, much better than the diversified entertainment industry average of 14. The company has debt of $14.9 billion, with $3 billion in cash. Its operating cash flow is $5.5 billion, more than enough to cover its dividend yield of 1.8%.

For more ideas, check out the Megan Fox Stock Index on Stockpickr.

Posted on Feb. 11, 2009