Zacks’ Voice of the People Highlights user MightyMo: “Stocks Too Hot to Handle?” from the People & Picks community.
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Stocks Too Hot to Handle?
These stocks have sizzled! However, at these levels, are they ‘Too Hot to Handle’? In other words, would you get burnt if you purchase these scorching stocks now?
On the other hand, are these ’Stocks that GET IT’. Do you get these stocks at these levels with the expectations that they will continue to go up?
I know one person who will short each of these stocks. Are you up to that?
Listed is the stock symbol, my ‘pp game’ buy-in price and % increase since that time.
1. Netflix (NFLX) 7/27/2010 bought in at 104.09, now up 54.57%.
NFLX just expanded into Canada. Do you think this company is done growing? Since its IPO in 2002, the stock has gained around 1,800%. Over the last year NFLX is up 247%. Year-to-date, it has gained 195%. Probably one of the absolute hottest stocks percolating. It is expensive at 43.5 times forward earnings. So it‘s expensive, but do you pay for performance! You decide, buy, pass, or short? Are we there yet?
2. Apple Inc. (AAPL) 7/27/2010 bought in at 264.08, now up to 285.05
This multi-media/tech company has revolutionized the way we live. Each year, new products come out or are updated. Do you think Apple is done with innovations and new products. Do you think their growth is done? Do you think their products will stop selling. Did the economy downturn hurt AAPL? This company is not terribly expensive on a valuation basis. It trades at a trailing P/E of 22, a forward P/E of 16.59, and a PEG ratio of 0.95. Not expensive. Do you buy the world’s most innovative company at a P/E ratio which is less than its growth rate? You decide, buy, pass, or short.
3. Chipotle (CMG) …bought in at 162.92 on 9/09/2010. Current price: 175.63
An absolute torrid hot fast-food restaurant company. Growth potential is huge. Currently considers 3,000 domestic locations available, current restaurants comprise only about 40% of that number. Has not entered the international market …yet.. In the tough economy years of 2008 and 2009, CMG had revenue growth of 23% and 14%. The stock has provided a steady uptrend pattern with a few base pauses. This is somewhat unusually for a stock at this price level as you would expect more volatility. You decide, buy or pass. If you want to bet on a short, try going to Vegas or the national lottery first, better odds. CMG currently above it 20, 50, 200MA.
4. Baidu.com (BIDU) …bought in at 84.43 on 9/10/2010. Currently up 22.39% to $103.21
The monster china search engine. The Google of China, Baidu has become the number one Chinese language search provider and the most trafficked website in China since its launch six years ago
The china search market is still only 1/10 of US market. Chinese customer are enjoying 100-400% in ROI on search ad, well ahead of the U.S.. This should drive more ad dollars to search versus other media. Thi means a huge untapped growth area. Analyst are projecting 50-60% growth in each of the next two years. Are you kidding me!
5. Priceline.com (PCLN) Bought in 9/9/2010 at 323.80. Current price 347.00.
PCLN last September was priced at 165. It has since doubled. This stock continues to surprise at earning reporting time. It is ahead of it’s industry. Gloom and doomers have consistently said to short this stock. Thestockmasters.com on May 7 said this bloated pig and expensive stock with a hefty PE needed to be shorted. The stock at that time was priced at 271. You decide, buy, pass, or short.
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APPLE INC (AAPL): Free Stock Analysis Report
BAIDU INC (BIDU): Free Stock Analysis Report
CHIPOTLE MEXICN (CMG): Free Stock Analysis Report
NETFLIX INC (NFLX): Free Stock Analysis Report
PRICELINE.COM (PCLN): Free Stock Analysis Report
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