It is time for the 2010 stock selections. As usual there will be six stocks to select from, with each fund picking 2 stocks. There are 3 US and 3 international stocks on the list. The 3 international stocks are all ADR’s meaning that they trade on US stock exchanges but move in sync with the stock in its home market (with the exception of the currency impact, favorable or unfavorable).
International Stocks (ADR’s):
1. Canadian Imperial Bank of Commerce (CM) – CM trades at around $73, near its 52 week high, with a market capitalization of $28B, and a yield of 4.6% (which is reduced a bit due to tax withholding). Canadian banks fared much better than US or European bank, due substantially to their favorable resource based economy, generally sound economic management, and lack of toxic assets
2. LG Display Company (LPL) – LG trades at around $16, below its 52 week high of $21, with a market cap of $11.5B, and no dividend. LG Display is an affiliate of the giant Lucky Group the massive Korean electronics company. and focuses on the manufacture of display panels for televisions and cellular phones.
3. CNOOC Limited (CEO) – CEO trades at $189, at its 52 week high, with a market capitalization of $84.5B, and a dividend of 2.6% (which is reduced a bit due to tax withholding). This Chinese oil company is poised to grow due to China’s demand for oil and gasoline and burgeoning local car market, which is poised to surpass the USA as the world’s largest
4. Alcoa Inc. (AA) – Alcoa is a US aluminum producer trading at $11.43, below its 52 week high of $21.4, with a market cap of $11.7B, and a dividend yield of around 1%. This iconic US aluminum producer can benefit from US infrastructure investment or any increase in US construction activity
5. Exelon Corporation (EXC) -Exelon is one of the largest US utilities, trading at $42, down from the 52 week high of $52, with a market capitalization of $28B, and a dividend yield of around 5%. This utility is well run and has a large nuclear fleet, and is savvy when it comes to acquisitions (don’t overpay) and in new construction (don’t invest in projects like new nuclear plants that do not meet financial hurdles). At this price the utility seems like a strong long term investment
6. Oracle Corporation (ORCL) – Oracle is an aggressive software vendor which trades at $25, near its 52 week high, with a market capitalization of $129B and a dividend yield of around 1%. This company is run by Larry Ellison who is a strong businessman and takes advantage of opportunities for consolidation in the software sector and leverages strong products and cuts unnecessary costs.
We will now go through the match process with each of the beneficiaries of the 5 portfolios contributing $500, then I match $500 and contribute $500 regardless of the match for a total of $1500 each. We usually purchase stocks at the end of the summer to give everyone a chance to earn money over the summer.
As far as the portfolios themselves, they have bounced back a bit with the general market since the last time I calculated performance.
Portfolio 1 – was $15,540 now $16,750
Portfolio 2 – was $8400 now $8900
Portfolio 3 – was $3500 now $3750
Portfolios 4 and 5 are getting nearer the $1500 mark of break even