For his top pick for 2010, Dennis Slothower turns to the "big screen" and highlights a company that could benefit from the recently release film, Avatar.
The editor of Stealth Stocks says, "IMAX Corporation (NASDAQ: IMAX) is one of the world's leading entertainment technology companies, specializing in motion picture technologies and large-format film presentations." Here's the reasoning behind his buy recommendation.
"The company's principal business consists of large-format digital and film-based theater systems. The sale or lease of such systems to, or contribution of such systems under, revenue-sharing arrangements with its customers and the conversion of two-dimensional (2-D) and three-dimensional (3-D) Hollywood feature films for exhibition on such systems around the world.
"IMAX's theater systems are based on proprietary and patented technology. Its customers that purchase, lease or otherwise acquire their theater systems are theater exhibitors that operate commercial theaters, museums, science centers or destination entertainment sites.
"The company generally does not own IMAX theaters but instead licenses the use of its trademarks along with the sale, lease or contribution of its equipment.
"In 2002, IMAX introduced a technology that can digitally convert live-action 35mm films to its large format at a modest incremental cost while meeting the company's high standards of image and sound quality.
"In 2003, the company introduced IMAX MPX, a theater system designed specifically for use by commercial multiplex operators.
"The IMAX MPX system, which is highly automated, was designed to reduce the capital and operating costs required to run an IMAX theater, all without sacrificing image and sound quality.
"Avatar, a movie made in 3-D, was just released this Christrmas. Critics are saying that it could be the nextThe Lord of the Rings, only it uses a new kind of 3-D technology that is expected to revolutionize the movie industry, much as did sound and color did in the last century.
"High expectations are pushing theater chains around the world to invest in this new digital 3-D system. IfAvatar is, in fact, a big hit, we're sure to see many more 3-D action films and many more 3-D theaters, which should increase IMAX's earnings sustainably.
"According to my numbers, IMAX should be selling in the low teens over the next three to five years. It is currently trading around $10, so IMAX has large upside potential. Place a sell stop at 25% below your entry price. As the stock rises, continue to raise your stop so that you are trailing the Friday close by 25%."
MannKind (MNKD): Nate Pile's top stocks For 2011
"My top stock pick for 2010 is MannKind Corp. (NASDAQ: MNKD), which is developing a a novel formulation of inhalable insulin called Afresa," notes Nate Pile.
In his Nate's Notes newsleter, he explains, "I would emphasize that while the stock must be considered speculative until the FDA delivers a ruling in mid-January of next year, I believe the clinical data that has been submitted by the company is likely to warrant approval.
"Inhalable insulin has admittedly been a losing proposition for other companies that have attempted to play the game over the years.
"However, I believe that MannKind's unique approach to the situation will not only help the company win approval for its drug, it will also allow the company to experience a surprisingly strong rollout of the product if/when it is finally approved.
"In addition to developing a drug that has a far more favorable clinical profile that the last inhalable insulin product to be approved (Exubera, in 2006), MannKind has also leveraged its engineering expertise to develop a vastly superior mechanical device for delivering the powdered insulin to a patient's lungs.
"The stock took a hit a few months ago when it was announced that the company would not be signing up a marketing partner for Afresa prior to the drug's approval.
"However, it has been my contention all along that it was most likely Alfred Mann (already a billionaire a couple of times over thanks to past successes with start-up companies) who walked away from any potential deals, not the other way around.
"And given how the stock has responded following the dip, it appears that the rest of Wall Street may be coming to its senses around the issue as well.
"Assuming the drug gets approved, it would not surprise me at all to see a marketing deal announced shortly thereafter, most likely on much better terms than the company would have received had it signed an agreement pre-approval.
"Along with this lead product, MannKind is also working on next generation products for not only diabetes, but for other metabolic disorders as well.
"In addition, the company is also doing a lot of work in the oncology arena, and as time goes by, we believe the company has the potential to grow significantly as it leverages its expertise in all three areas it is doing work.
"With the caveat that the stock is likely to tumble sharply if the FDA denies approval of Afresa next month (and thus needs to be considered 'speculative' by all who by it ahead of the ruling), I believe MannKind currently represents one of the best risk- reward ratios among all the top stocks to buy. MNKD is considered a strong buy under $9 and a buy under $12."
Matthews Asia Dividend (MAPIX): Mark Salzinger's top stocks For 2011
"Though most investors do not associate Pacific-Rim investments with high dividend yields,Matthews Asia Dividend (MAPIX) could change their perception," says Mark Salzinger.
In his No-Load Fund Investor, he looks to this fund, which he notes recently o?ered a dividend yield of approximately 4%.
"The fund recently o?ered a dividend yield of approximately 4%. Managers Jesper Madsen and Andrew Foster seek to fill this fund with dividend-paying stocks of companies.
"The managers select top stocks throughout the Asia-Pacific region, including Japan, China/Hong Kong, Taiwan and recently at least eight other Asian countries. Though dividends did not protect investors in American stocks from the carnage in 2008, they appear to have reduced losses for investors in Asian equities.
"Matthews Asia Dividend (formerly known as Matthews Asia Pacific Equity Income) fell only 26% in 2008, vs. 42.2% on average for the funds in Morningstar's Diversified Pacific Stock category. So far in 2009 (through Dec. 14), Matthews Asia Dividend has gained a whopping 48.1%, vs. 31.1% for its peers.
"That means the fund did about 16 percentage points better than average in a down year, and has done about 17 percentage points better in the bull market so far in 2009!
"The Matthews funds specialize in attempting to form portfolios of 'indexes of the future' in Asian markets. In other words, they seek exposure to publicly traded companies in su?cient quantities to represent a picture of Asian economies as they are likely to develop over time, not as some index developer imagined them to be several years ago.
"So, compared to existing indexes of Asian stock markets, the Matthews funds tend to devote more of their assets to consumer stocks and midsize and small-cap companies, and less to big exporters and other famous companies.
"Matthews Asia Dividend is available directly from Matthews Funds (800-789-2742; matthewsfunds.com) as well as no-load at various fund supermarkets."
Aflac (AFL): Dirk Van Dijk's top stocks For 2011
"Aflac (NYSE: AFL) is best known in the U.S. for its 'duck ads,' but actually earns over 75% of its money from Japan," says Dirk Van Dijk.
In selecting the stock as his top pick for 2010, the strategist for Zacks.com, recalls "Aflac happens to be an old favorite of mine, a stock that I first recommended back in 1991." Here's his current update.
"In the U.S., its policies are sold through employers on a payroll deduction, as part of companies 'cafeteria plans'. They are pretty straight forward. If you get sick and can't work, or are in the hospital, it pays out a set mount directly to the insured.
"It is thus not at risk for rising health care costs (but is if more people get sick). The U.S. unit was under some pressure as payrolls shrank, but with some positive news on the employment front, that should turn around.
"In Japan, once people get AFL insurance they don't drop it (which is very important in the life and health insurance industry) with a persistency rate of 95%.
"The firm has a superb track record, but came under big pressure during the crash last year due to fears about its investment portfolio. I think those fears are being assuaged over time.
"It has already realized $1.7 billion (pre-tax) in investment losses. Some of those are not going to come back, like its holdings in Lehman Brothers and WAMU, but other parts of the holdings that were written down just might come back.
"Aflac did however write down $380 million as other than temporary losses in holdings of some Ford debt, and Ford has been doing much better of late, certainly much better that it looked back at the end of the first quarter when GM and Chrysler were going down for the count.
"The company has generated an ROE of 33.4% over the last 12 months, and its five year average ROE is 20.84% (it has leveraged up a bit, from having no debt to a still very manageable and conservative 22% debt to capital. As that happens AFL should return to its historic valuations.
"How much upside potential is that? A Lot. Over the last five years (which of course included the big sell o? last year) AFL's P/E has averaged 15.4x.
"Based on 2009 earnings estimates it is going for 9.5x now, and 8.7X 2010 consensus estimates, and those estimates have been rising.
"AFL also has a habit of beating the estimates. It has done so the last three times out, and in 17 of the last 28 quarters, with only five disappointments.
"AFL currently yields 2.4%, which is nice. It has however, increased that dividend in each of the last 27 years, and over the last 15 years it has done so at a compound annual rate of 20.7%.
"AFL happens to be an old favorite of mine, a stock that I first recommended back in 1991, and was a core holding for most of my tenure at C.H. Dean. I know the management team well from those days, and they are amongst the best I know in the industry."
AgFeed Industries (FEED): Ian Wyatt's top stocks For 2011
"With the worlds largest and a quickly growing population of 1.3 billion people, China has many mouths to feed," observes small cap specialist Ian Wyatt. In his Small Cap Investor Pro, he explains, "One of my favorite China small cap stocks is AgFeed Industries Inc. (NASDAQ: FEED), a hog feed and breeding company.
"I've been bullish on China for several years, but my recent 3-week trip confirmed my bright outlook for this emerging market. The best news for investors is that just like the rapid growth Chinese economy, many China top stocks are profitable and expanding, yet their shares are trading at very attractive valuations.
"AgFeed Industries sells products to distributors and large-scale pig farms. Pork is a big business in China, and the country is the largest consumer of pork in the world.
"In China it is estimated that nearly half of consumer spending goes towards food, and pork is an essential component of the Chinese diet and accounts for over 60% of total meat consumed. My first-hand experience is that pork is far and away the most popular meat in China.
"China discourages pork imports, so suppliers operating within the country need to meet almost all of the nation's pork demand. The country produced 625 million hogs in 2008, almost 50% of the total worldwide production and five-times the number produced in the U.S.
"The challenge for Chinese producers is that undersized backyard farms still account for over 70% of production, and the country has yet to industrialize the farming industry.
"However, the government is encouraging sustainable farming with the goal of increasing food production, and this is a mandate that should bode well for agricultural top stocks to buy.
"AgFeed Industries has made two strategic agreements this year that will boost production and expand margins.
"The company recently signed a joint venture with M2P2, a production and management consulting firm. This venture will modernize AgFeed Industries' production facilities and enhance total production capability.
"The company also formed a partnership with Hypor, a genetics development company which will increase the quality of the hogs. "Both partnerships combined may boost total output by 30%, while improving the product quality. The end result for AgFeed will be a higher market price and contribute to margin expansion in 2010 and beyond.
"During the first nine months of this year, AgFeed Industries grew revenues by 20% to $117 million from $97.2 in the first nine months of last year.
"Margins have decreased this year as hog prices cannot keep up with the rise in feed price. As a result, profit margins declined to 15.8% from 27% in the first three quarters of fiscal 2009. Naturally, earnings have also come down from last year's record levels, with EPS of $0.18 versus $0.42 in the same period last year.
"But investors should view these results as a short-term bump in the road on a long- term growth opportunity. AgFeed shares have fallen 45% since their 52-week high back in June, a reflection of the poorer than expected financial results.
"This minor set back should not concern long-term investors in AgFeed. Despite the fall in hog prices earlier this year, the company was still able to bring in $1.9 million in operating cash flow. AgFeed is also sitting on over $36 million in cash, and has minimal debt obligations.
"I expect EPS of $0.31 for this year and $0.70 in 2010. Shares of AgFeed are currently trading 14.5-times my 2009 EPS estimate. And looking forward to 2010, shares are valued at just 6-times my earnings estimates.
"For a company with expanding sales and future upside from expanding profit margins, I see significant upside for AgFeed shares which I believe should trade at a P/E of 15.5-times 2010 EPS.
"My AgFeed share price target of $10.50 represents a 138% increase from the late December share price, and provides investors in this stock with lots of upside."
Brazil Small Cap (BRF): Nicholas Vardy's top ETF stocks For 2011
"The global bull market is back in Brazil," says international investing expert Nicholas Vardy.
In The Global Bull Market Alert, he explains, "Global markets recovered in the beginning of November; at that time, we looked to one of the hottest markets on the planet, Brazil, through the Market Vectors Brazil Small-Cap ETF (NYSE: BRF). The ETF remains our top.
"Brazil, as its place on the cover of Economist magazine recently confirmed, was the flavor of the month in emerging markets. Brazil had recently won the right to host the Olympics in 2016, raising its profile much like the Beijing Olympics did for China. Investors were pouring in.
"Its currency, the real, gained 50% against the U.S. dollar since the prior December, with the economy firing on all cylinders, posting an 8%-10% growth in Q3. My forecast has been that, overall, Brazil's economy will grow by 5% in 2010.
"In December, the Inter-American Development Bank approved a $3-billion conditional credit line with Brazilian small and mid-sized businesses on Thursday.
Around 75% of the new jobs created in Brazil this year were created by small and mid- sized businesses.
"With the market already up 76.9% in local currency terms at the time, betting on Brazil was clearly a momentum play. That's also why I recommended a small cap ETF, which had outperformed its large cap ETF counterpart this year.
"Looking ahead, Brazil's biggest enemy is likely to be its own hubris -- getting too cocky for its own good. But before it does, I'm betting the market has further to go. After all, it went up almost 6-fold in dollar terms during its last bull run starting in 2003.
"This is the reasoning behind my recommendation for Market Vectors Brazil Small- Cap ETF. For a potentially bigger upside, I recommended the April $45 call options. For full disclosure, this is a position that I hold on behalf of my clients at Global Guru Capital."
China Adv. Construction: (CADC): Keith Fitz-Gerald's top stocks For 2011
"China is spending $200 billion over the next few years to upgrade its rail system; and those new projects will be literally laying on a bed of cement,' says Asia expert Keith Fitz-Gerald.
The editor of The New China Trader adds, "This could lead to enormous growth potential for any cement company that Beijing involves in the
process -- such as China Advanced Construction Systems (NASDAQ: CADC).
"CADC produces and supplies specialized ready mixed concrete for use in all kinds of infrastructure projects including railways, roads, airports, bridges, tunnels, and dams. The company has already benefitted from over 9 new railway contracts from Beijing this year alone, totaling over $19.7 million.
"That may not sound like much, but realize that CADC is a small cap stock ($49.28 million market cap) so $19.7 million of new railway orders represents 39.9% of the company's total market cap. That means we could see CADC's earnings explode in 2010.
"In fact, if Beijing continues to pile money into railways, CADC could truly undergo some transformational events that lead to a double or more in 2010 � and more in the next few years.
"Meanwhile, China's massive $586 stimulus package has rocketed the Chinese economy back on track � and the result can be seen across the board from government sponsored infrastructure projects to consumer spending.
"By the end of 2009, the China is expected to have used 1.54 billion tons of cement on transportation infrastructure and logistics and warehousing projects, according to the country's top economic planning agency.
"In the transportation, logistics, and warehousing sectors alone, China is expected to have increased 2009 cement demand by 27% from the previous year, according to Guo Wenlong, a researcher with the Institute of Integrated Transportation, a?liated with the National Development and Reform Commission.
"China is literally building what amounts to an entire new country's worth of infrastructure and commercial projects.
"Economists are forecasting that China will use 40% of the entire global supply of cement in 2010. That basically makes China the world's largest construction site �something I see every time I am there.
"While concrete isn't sexy or glamorous, the industry's growth is far from boring. China's concrete market has maintained an average growth rate of 25% over last ten years.
"That adds up to a 931% compounded growth over the last 10 years. Compared to most investments, that sounds pretty glamorous to me.
As for its rail expansion, China plans on laying more track in the next five years than the rest of the world combined. That makes China's current railway plans the largest railway expansion in the last 100 years.
"The buttresses on which China's railway projects will be built are forecasted to require as much as 117 million tons of concrete alone � and that doesn't even begin to account for cement demand tied to China's other infrastructure projects.
"Basically all of China's growth, whether it's railways, roads, bridges, power-plants, dams, or commercial and residential real estate projects sit on a foundation of cement � and that means dynamic small-cap companies like CADC have plenty of room to grow and enormous profit potential moving into 2010 and beyond."
China Digital TV (STV): Glenn Cutler's top stocks For 2011
"My top pick for 2010 is China Digital TV Holding Co Ltd. (NYSE: STV), the #1 provider of conditional access (CA) systems in China's digital TV market," says Glenn Cutler.
In his Winner Forum and Special Situations Reports, he explains, "I consider this a conservative idea to play the China market through an established company that dominates its business sector.
"China Digital TV Holding is based in Beijing, China and was founded in 2004. They are in a strong position to leverage their current 50% market share in China. Of 375 million TV households across China, 168 million are cable subscribers with an additional 10 million added each year.
"With only 54 million smart cards shipped industry wide, there is ample opportunity for growth, market share expansion and royalties and revenue sharing with cable operators. They have over 225 customers, with roughly 30 of them providing over 1 million subscribers each.
"Currently, their CA systems consist of smart cards (90% of revenue) and head-end software for television network operators, as well as terminal-end software for set-top box manufacturers.
"They enable digital television network operators to control the distribution of content and value-added services to their subscribers and block unauthorized access to their networks.
"The company also licenses its set-top box design to set-top box manufacturers and sells advanced digital television application software, such as electronic program guides and subscriber management systems to digital television network operators.
"There are several reasons why the stock price has been trading near its annual lows. Recent revenues have been under pressure and earnings have been soft due to the postponement of digital migration projects as cable operators wait for greater clarity with respect to industry consolidation and subscription fee adjustments in certain regions.
"The company has faced pricing pressures and they've reduced selling prices at times as a tradeo? for gaining new customers in less populated areas.
"These factors have led to downgrades by some analysts. Earnings for FY2009 are expected to be .42/share down from .72/share in FY2008. Expectations are low as earnings projections for FY2010 are estimated to be flat at .42/share.
"China Digital has a solid financial structure with $225 million in cash ($3.87/share) which was reduced by distribution of a $1 per share special cash dividend in Feb/ 2009. The balance sheet is solid with zero debt. They maintain a strong market position for continuing growth.
"The company intends as a policy to consider special dividends every two years. The current market cap is $348 million. Trailing 12-month profit margins are 54%.
"Book value is $4.25 a share. The P/E Ratio is 11. There are currently 58 million shares outstanding. The shares are trading close to their 52-week low, within a yearly range of $5.60 (low) to $11.80 (high). Return on equity is 12%.
"With expectations low, there is potential for upside surprise if digital migration projects start to accelerate. With shares trading at about $2 above their cash position, downside risk is partially mitigated. The company could use cash on hand to acquire productive assets should attractive opportunities arise to compliment their product o?erings or consolidate their industry sector.
"As a conservative way to play expected growth in China, this company o?ers an excellent low-risk technology angle for a 2010 stock portfolio. A good upside target range over 12-months would be $8-$10."
Ford Motor (F): Mark Skousen's top stocks For 2011
"Ford Motor Co. (NYSE: F) is in the driver's seat when it comes to innovation, cutting costs, and building global demand," says Mark Skousen.
In his Forecasts & Strategies, which this month is celebrating its 30th anniversary, he cautions, "I've decided to recommend Ford as the best turnaround speculation for 2010. Bear in mind that this is highly speculative, and not recommended for conservative investors.
"Ford shocked Wall Street and Washington two months ago in reporting its first positive cash-flow quarter in more than two years. Of course, it played some accounting games to do it, but the overall direction is up.
"Ford made its first billion by successfully increasing domestic sales for the first time in nearly five years, and boosting market share against its chief rivals, Government Motors (GM) and Crying Chrysler.
"Meanwhile, the #2 auto maker predicted it would turn solidly profitable by 2011 as a result of its cost cutting measures and renegotiations with the unions.
"Ford is the only major US auto maker not begging for a government bailout last year. This isn't the first time Ford has broken away from the government trough. In the early 1980s, Ford executives opposed the call for import quotas on Japanese cars and took on their competitors by raising quality standards.
"I've been a long-time buyer of Ford cars, including two Mustangs, an Explorer truck, and a Lincoln Town Car. I have enjoyed relatively maintenance free service for years.
"Maybe my experience is exceptional, but most car rating services, such as Consumer Reports, rank Ford ahead of its domestic competitors. The company is innovative. The hot-selling Ford Taurus just won Kelly Blue Book's '2010 Best Redesigned Vehicle.'
"Its engineers have developed the first robot (named RUTH) to scientifically test the feel and appearance of switches and surfaces in their automobiles. And Ford's Quick Lane Tire and Auto Centers are expanding rapidly across the country.
"Ford isn't out of the woods yet. It still carries an incredible (gulp) $103 billion in debt (it blundered by borrowing billions to buy back its stock at much higher prices) and has been forced to restructure its debt again. Unions are refusing to cut back any further their generous medical and pension benefits.
"CEO Alan R. Mulally, a turnaround executive from Boeing, deserves high marks for Ford's latest success. If anyone can make an elephant dance, he can.
"The stock price has already tripled in price in 2009, but it is still way below its previous high of $40 a share in the late 1990s, so it has lots of room to grow. It's selling at 20 times next year's earnings, and has over $32 billion in cash.
"We're adding Ford Motor Co. to our growth stock portfolio, with the caveats that the stock does not pay a dividend and is considered high risk. As such, it may not be for everybody."
FPL (FPL): Vita Nelson's top stocks For 2011
Vita Nelson is well-known as a leading expert on dividend reinvestment plans.
With the caveat that she always recommends portfolio diversification, the editor of The MoneyPaper looks to utility stock FPL (NYSE: FPL) as a top selection for 2010.
"We make a point of recommending that people don't pin their hopes on just one stock (which might underachieve in the short-run).
"Nevertheless, as a top pick for the comin year, I like FPL Group is the parent of Florida Power & Light, a utility that engages in the generation, transmission, and distribution of electricity to 4.5 million customers in a 27,650 square mile area of eastern and southern Florida.
"Its NextEra Energy Resources subsidiary is a non-regulated power generator that produces electricity from nuclear, natural gas, solar, and wind generation.
"It owns 48 wind farms in 15 states producing 4,100 megawatts and could double that output within the next four years.
"The company is expected to earn about $4.15 per share this year and $4.57 in 2010, compared with $3.84 in 2008.
"The dividend has been increased for 15 consecutive years and the annual payout now stands at $1.90 per share, for a yield of about 3.4%."
Gafisa (GFA): Paul Goodwin's top stocks For 2011
"My pick for the top stock of 2010 is Gafisa (NYSE: GFA), a Brazilian homebuilder and developer," says emerging markets specialist Paul Goodwin.
In his Cabot China & Emerging Markets Report, he explains, "This is an experienced growth company in a country with an excellent economic engine." Here's the advisor's review.
"Gafisa has been growing fast and has a huge future. Brazil doesn't get much publicity in an investing world focused on China, but its economy is also growing at a sustainable 5% a year and it's a lot less dependent on exports than China. "Gafisa has completed nearly 1,000 projects and the company is active in 21 of Brazil's 26 states as it moves outside its traditional markets of Rio de Janeiro and Sao Paulo.
"Brazilian interest rates have been coming down and the middle class is growing―up 24% in just the last four years―which will boost demand for housing.
"Gafisa reported a 358% surge in earnings in Q3 on a 128% jump in revenue and the backlog of developments on the board is strong.
"As for the stock, GFA has made a strong recovery from its late-2008 lows, but the stock's P/E ratio of 21 is still quite reasonable for a strong growth issue.
"The stock has been trading sideways since August 2009, perambulating in a range with a core of support at 30. It looks like an excellent base for a new rally, and 2010 should see the breakout.
"This is an experienced growth company in a country with an excellent economic engine and the stock pays a small dividend―that's an attractive package!"
Goldcorp (GG): Curtis Hesler's top stocks For 2011
Curtis Hesler had successfully forcast the recent pullback in gold and the upmove in the US dollar. However, he believes these moves are temporary.
In his The Professional Timing Service, he suggests, "It is time to focus on upcoming buying opportunities in precious metals." Here, he looks at Goldcorp (NYSE: GG) as his top pick for 2010.
"On December 8, my U.S. dollar timing model kicked in with a buy signal. I had been writing about the likelihood of a rally in the dollar for several weeks, and that signal was the key indicator I had been waiting for. The signal indicated the dollar was going to rally.
"There is a defensive aspect to this as well as an o?ensive play. I have been a gold bull and dollar bear since late 1999, but the long term secular trend has been interrupted from time to time.
"This was one of those times when stops needed to be put in place to protect gold profits and new opportunities evaluated. We raised cash by taking profits in many of our gold positions, and we have parked that money in cash for the time being.
"However, that is all water under the bridge at this point. It is time to look for the next opportunity to put this cash back to work.
"Although you will be hearing about a new bull move in the dollar, the dollar rally is temporary. Gold and the mining shares will come o? as a consequence, but only in the short term. It is time to focus on upcoming buying opportunities in precious metals. "There are a lot of mining operations to choose from, but there is one company that must be at the core of your precious metals investment � Goldcorp.
"Goldcorp is simply the best gold miner on the planet. They are one of the world's largest gold mining companies with the strongest growth profile among all of the big producers. They are also the lowest cost and fastest growing senior gold producer in North America.
"The time is now to focus on acquiring gold as the emotional folks that bought at the recent highs become discouraged and sell their positions. I always give my readers simple specifics in this regard. Buy Goldcorp at $34.50 or better."
Hard Asset Producers (HAP): ETF Authority's top stocks For 2011
"Whenever inflation heats up, there's no better place to park your cash than in tangible commodities," says Nathan Slaughter.
his The ETF Authority, he noes "Our favorite play on this sector is Market Vectors Hard Asset Producers (NYSE: HAP), an ETF whose 300-stock portfolio provides one-stop shopping for six distinct commodity sub- sectors.
"History has shown conclusively that there is one asset class that thrives above all others under these hostile conditions: commodities. A depreciating dollar is a sure-fire recipe for rising commodity prices. And when inflation is on the rampage, investors always like the reassurance of owning hard assets.
" Instead of watching prices for things like steel and gasoline rise all around you, why not convert your dollars into these commodities directly and enjoy the ride?
"Even if the Fed does manage to keep inflation in check, we believe that good old supply-and-demand fundamentals favor rising prices anyway.
"With the global economy getting back on track and emerging powers like China swallowing mountains of raw materials, the short-circuited commodities rally will have juice once again.
"Investors have a dizzying array of options here, but our favorite is Market Vectors Hard Assets. The fund is invested in six commodity sub-sectors.with top billing going to the energy sector, where integrated oil & gas giants, o?shore drillers and equipment/service providers soak up about 40% of the fund's assets.
"Elsewhere, shareholders will have a large stake in agricultural firms, ample exposure to gold and silver producers, along with aluminum, nickel, iron ore and other critical industrial metals. Rounding out the portfolio are holdings linked to coal, steel, uranium and even forest products.
"Whether it's to protect purchasing power against the ominous threat of currency debasement or a simple bet on stronger economic expansion, both point to a continued run-up in commodity prices -- and the shares of producers that bring us these goods."
