4 Magic 8 Ball Stock Picks for 2013

Magic 8 Ball

The Masters turn to a source more credible than our U.S. Congress for investment advice.

We are now trading in 2013.  Thanks to the uncertaintly of the U.S. Government we ask our collective reasoning device for help.  Cue the Magic 8-Ball for help.  With a few shakes we were able to determine it is right to buy shares of GameStop Corp (GME), NutriSystem Inc. (NTRI), Chipotle Mexican Grill, Inc. (CMG), and Financial Select Sector SPDR ETF (XLF).

 

SHORT SQUEEZE IS ON
If the markets except the 'Fiscal Cliff solution' it could be advantageous for heavily shorted popular stocks.  That means GameStop (GME) with a 36% and NutriSystem with a 15% short interest respectively.  Nutrisystem is a classic way to start the year with everyone rushing to use their products to lose weight.  NutriSystem Inc 's (NTRI) is trading near the bottom of its 12 month range at $8.17 per share. 

GameStop (GME) closed at $25.09 on Dec 31st.  GME pays a 4% annual dividend yield despite its huge short interest.  The long term outlook for video game sales remains to be seen if it can survive in the company's brick and mortar business model.  However GameStop has been getting props for now selling mobile devices and tablets. 

GME

NutriSystem is planning to pay out a 8% annual divdend yield in 2013.  The company needs to have impressive Q4 numbers to break out of its depressed stock price.  NTRI appears to be a value play at this point, but can it convince Wall Street its worthy of a higher share price?

ntri

 

FAST FOOD
Chipotle Mexican Grill, Inc. (CMG)
is a stock we've talked up enough on this website.  It made the cut in Fast Food Stocks for 2013 and our premise remains unchanged.  Chipotle Mexican Grill (CMG) is trading at $297.46 and is comfortably above its 12 month low.

cmg

 

GET LONG U.S. FINANCIALS
Rather than go with Bank of America (BAC) or Goldman Sachs (GS) buy them all with one shot using the Financial Select Sector SPDR ETF (XLF).   The coming year could finally see the comeback of the best financial players.  If housing continues to improve and the bad loans finally die out then lending will increase and boost everything.  The XLF sports a 1.7% annual dividend yield and we love its top ten holdings (see below):

  Name Symbol Index Weight
1 Wells Fargo & Co WFC 8.41%
2 JP Morgan Chase & Co JPM 8.40%
3 Berkshire Hathaway'B' BRK.B 8.23%
4 BANK OF AMERICA CORP BAC 6.29%
5 Citigroup Inc C 5.83%
6 US Bancorp USB 3.02%
7 Goldman Sachs Group Inc GS 2.83%
8 American Express Co AXP 2.81%
9 American Intl Group Inc AIG 2.62%
10 SIMON PROPERTY GROUP SPG 2.46%

xlf