Top 10 US Stocks



Welcome to the Top 10 US Stocks. Please recognize that these are not recommendations… they are my personal top 10 stocks that I trade on a regular basis… but they may not be for you. My stock choices are guided by several factors including their volume and price action as well as their key fundamentals. Once I have found stocks that meet my criteria, I examine the technicals to help guide my purchases and sales, paying specific attention to the stock’s volume and price.

Many investors struggle because they follow too many stocks… not to mention the “wrong” stocks. Then, once they’ve made their selections, they use emotion, news, or some other subjective guide for when to purchase or sell the stocks. Does that sound familiar?

Here at Invest in the Markets, we use reliable, proven strategies to help us make our selections… and guide our timing to protect our capital and maximize our returns.

#1 - Apple (AAPL)

Apple is arguably one of the world’s most well known companies… and it you take a look around you you’ll see why. Whether it is a potable music device, a personal computer, or a smart phone, Apple is taking a bite out of the competition. Besides the remarkable growth Apple has demonstrate over the past several years, Apple carries no debt. Furthermore, Apple continues to impress its clients and investors with new products… fueling their earnings.

Apple seems to be moving beyond the tragic news of Steve Jobs’ recent death. The recent earnings numbers were astounding. Quarter 1 revenue of $46.33 Billion (yes, not Million, but Billion). 37.04 Million iPhones sold (128% growth year over year), 15.43 Million iPad sold (111% growth year over year), 5.2 Million Macs sold (25% growth year over year). If you think this stock is somehow expensive, consider dividing it by 10 and there you have it… a more manageable number to work with in your head.

#2 - LuluLemon (LULU)

I love companies that are growing through sales and have low to no debt. Lululemon fits that criteria… with 0 debt and a three year sales growth rate of 39%. Couple that with a 36.2% Return on Equity, Lululemon is positioned to keep on growing.

When I look around at general everyday consumers, I often see three things… and Apple product, a coffee beverage of some kind, and some Lululemon. Somehow, this company has mastered the ability to target a multigenerational cliental. Trading with excellent volume, Lululemon is a great stock to trade when the technicals are right.

On November 8th, 2011, LULU announced the launch of ivivva, an online dance and athletic apparel store for young girls across the United States. Offering sport bras, tanks, leotards, jackets, shorts, etc… which will only help the bottom line of LULU.

#3 - Monster Beverage (MNST)

Monster Beverage, formerly Hansen Natural, tops my stock choices with its strong fundamentals such a 0 debt and 30% annual Return on Equity. But it’s not all about the fundamentals… Take a look around you again… see what people are consuming and you’ll see Hansen’s Natural products within reach. From the sodas to the fruit juices to the Monster energy drink label, Hansen Natural has reached into many homes.

I recently highlighted Hansen Natural in a series on the best cold beverage stocks in which I pointed out the strength of the stock price in 2011… but again, similar to other leaders, investors shouldn’t shy away from a rising stock price. Simply be prudent in using the technicals to guide one’s transaction choices.

#4 - Chipotle Mexican Grill (CMG)

Chipotle Mexican Grill is a leader in its sector without debt… Combine any stock with rising sales, new stores opening, and 0 debt and you’ll get a winner. With a 23.6% Return on Equity, Chipotle Mexican Grill is positioned to continue to be a leader.

With nearly 1,100 stores, Chipotle Mexican Grill has significant recognition and reach. In fact, when planning a recent trip, I took a few moments to look up where I might find one… since where I am, they don’t exist yet. I recently wrote a brief article on Chipotle Mexican Grill discussing some of the factors of this company and stock… and decided it would be a healthy choice for any portfolio.

#5 - MasterCard (MA)

Whether you’re buying a new iPad 2, some Chipotle, or a beverage, MasterCard is the link between consumers, businesses, and financial institutions. Transactions across the world, whether pre-paid, debit, or credit all supply this companies 42.4% annual Return on Equity.

When you have a stream of income with no debt in a growing market environment where more and more consumers and businesses are turning toward the plastic, MasterCard is positioned to grow.

#6 - Dollar Tree (DLTR)

With over 4,100 locations in 48 states as well as Canada, Dollar Tree is the leader of this growing segment within consumer discretionary. With the vast majority of its diverse selection of items selling for less than a dollar, this company is making an impact one sale at a time.

And all those dollars are adding up… with a 28.6% Return on Equity and relatively low debt/equity ratio of 17%, Dollar Tree continues to expand leading many investors to believe, money really does grow on Dollar Trees!

#7 - Red Hat (RHT)

Red hat provides open source operating systems and software solutions, including cloud deployments… and while that my not sound too appealing to you, the numbers might entice you.

Although Red hat’s Return on Equity is slightly lower than the 15% mark (sitting at 13.6%), it still stands out as a financial leader. With 0% debt and a healthy 25.6% profit margin, this growing company is poised to continue its sales growth patterns. And with many companies setting up and transitioning to the “cloud” concept of data storage and retrieval, Red hat is positioned well to produce consistent profits.

#8 - Herbalife (HLF)

You may be a little less familiar with Herbalife than many of the other top 10 stocks… but you’ll want to familiarize yourself with the stock. Herbalife is an international company that markets and distributes its weight loss products, nutritional supplements, personal care and skin products among other items in over 75 countries.

Consumers are impressed with the products and investors are impressed by the results. With an annual Return on Equity of 70.2% and a grass-roots distributor base of 2.1 million members, the potential for growth is remarkable… simply be cautious of a weakening world economy.

#9 - Intuitive Surgical (ISRG)

Developing advanced surgical systems designed to improve open surgery outcomes and minimize the invasive nature of surgery is at the heart of Intuitive Surgical’s mission. And they are leading the way… all the while maintaining 0 debt and growing sales.

With a 28% three year sales growth rate and a 21.4% annual Return on Equity, Intuitive surgical is positioned well to lead the sector for years to come… and help investors too!

#10 - TJX Companies (TJX)

Sometimes it can be hard to find a company with over 30 years of experience still able to produce growing revenues. TJX Companies is one of those fresh alternatives. For investors looking for a fairly conservative, yet growing, company to invest in, TJX is appealing.

TJX boasts a healthy return on equity and a small dividend, giving it room to increase it as profits rise. This apparel and home fashions retailer, the largest of its class in the world, continues to achieve profitable growth year after year despite the varying economic and retail cycles.

*Last updated on March 1, 2012

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