Last December I received an email to join the 2012 Island of Misfit Bloggers Stock Picking Contest. How could I pass up picking 4 stocks just so I could see who the competition was going to be?
I fully intended to roll up my sleeves to do some research and analysis on stocks that could do well in 2012. That didn’t happen.
Instead, as the holidays approached and then rolled by the December 31st deadline was starting me down – it was the 29th. It was time to pick some stocks. But what criteria was I going to use?
At the end of the day, quite literally, I opted to pick 4 stocks that make sense to me which can be linked to sustainability of some definition. I also picked the stocks with total disregard to whether I would truly considering buying the stocks with our own money.
Now that the first quarter of the year has passed this long overdue post about the contest and my picks moved back to the top of the to-do list. It also helps that thus far the stock selections have performed quite well.
The founder and visionary of Apple, Steve Jobs, passed away in 2012. His ideas and empire are still very much a force in technology, and will remain a force for some time. The folks running Apple should understand that the legacy of R&D, brand recognition and trust, not to mention market dominance means steer the boat, don’t rock it.
The iPad(3) was released to good reviews and Apple will also release new Macbooks and likely the next generation iPhone in 2012. And don’t forget Apple TV will be launched as well. I won’t be surprised if Jobs’ fingerprints are all over the iPad7.
Apple products cost more than the competition. The product is better than that of the competition. Ditto marketing. And today I learned that 51% of households own at least one Apple product. Our household does not have an Apple product but we did give one away last November.
Cost: $405.55 Current Price: $599.95
Overall Return: 48%
We live on a continent where companies are (usually) forced to at least consider the impact they make on the environment. Unfortunately we also live on a continent where companies screw up and environmental disasters occur. This is where EEI comes in. This company provides a slew of environmental consulting services to both private and public sectors that don’t naturally migrate toward sustainability.
On the flip side, EEI also helps deal with global pandemic mitigation and reaction and assists in the restoration of environmentally damaged areas. Add a 3.20% yield for those interested in dividend investing, this 40+ year old company is one that caught my eye quite some time ago.
Disclosure: We have interests in EEI.
Cost: $16.16 Current Price: $15.22
Overall Return: – 5.8%
Potash Corp. of Saskatchewan, Inc. (POT)
Potash. You might have heard of it. Potash is a mine salt that contains potassium. It is used in water softening, pharmecutecal production, cement and fire extinguishers (to name a few). The thing is, potash is also used in snow and ice melting, to deal with industrial water treatment and in synthetic rubber manufacturing.
Doesn’t sound like a friendly product, right? Well, potash is also used for producing fertilizer (in which crops grow), making stock animal feed and even beer brewing!
Putting aside the long discussion regarding industrial farming and mass food production, let’s face it: the humans on this planet need to eat. While it sure would be nice if we could receive organic and local food the food production and distribution systems in place today dominate the sustenance industry.
Canada produces more potash in a year than any other country, and, has the largest reserves as well. An Australian company, mining giant BHP, tried to buyout POT for $39 billion dollars with a hostile takeover in late 2010. The Canadian government intervened and said “nuh uh, you aren’t buying our gold mine”.
The world must eat.
Cost: $41.28 Current Price: $45.69
Overall Return: 10.7%
Medical Marijuana, Inc. (MJNA.PK)
A few decades ago I had a “what if” conversation with a few guys about business potential if marijunana was legalized. In the early 90s the whole notion was a foreign concept and the guys I was speaking with had dreams of visiting Amesterdam where they could, ahem, experience system first hand. To my knowledge these guys didn’t follow through with their idea.
The folks that did find the motivation to follow through don’t likely go to stakeholder meetings wearing tie-dyes.
MJNA is a company that is looking to take advantage of a business opportunity. 17 states have made marijuana legal for medicinal purposes. Sure, they are involved in exploring some 55,000 other uses for Cannabis and industrial hemp but my guess is they’re in at the ground floor of a societal change in attitude toward the use of good ol’ Mary Jane.
The state already tells us that smoking cigarettes and drinking booze are legal if you are a certain age. The fight against the weed has been, and is being, lost. Many government resources (read: your taxes) are used fighting the futile fight. Trying, convicting and imprisoning those who are dangerous, and those that are not is not cheap. Organized crime gains when our governments recognize they could do so – and tax the heck out of the product (like booze and smokes).
Someone has to provide services that deal with the financial & legal intricacies, distribution, production (including testing), revenue collection and management of an increasingly legal enterprise that has made a LOT of money for distributors of pot (illegally) for decades. Right?
Plus, I wanted to make a pick that would raise eyebrows and produce a few chuckles, smirks or looks of puzzlement.
Cost: $0.017 Current Price: $0.057 (yes, just over 5 1/2 cents)
Overall Return: 245.5% !!!
So those are my four stock picks for 2012. For one reason or another each pick, at least to me, without any true financial analysis being done, make business sense and in one way or another can be linked to sustainability. The point of the contest is to have some fun and it has done precisely that. After Q1 of 2012 SPF sits in first place! The four picks are up 74.6%