Equities have taken an acid bath since last Thursday. Mastery reviews three stocks that declined but will bounce back.
U.S. stocks won't be down for long and this pullback is an opportunity to buy a few solid picks and one underdog. Mastery is recommending buying up a few shares of General Electric (GE), Monsanto (MON), and wild-card Chesapeake Energy (CHK).
At this point, who cares if Greece leaves the Euro Zone. The Talking-Heads are saying its already baked into the market and everything else. Put your faith in popular belief and get to the stocks that big money wants now, that's why we are going with GE, MON, and CHK.
General Electric (GE) is our favorite of the three. GE shares are back up today to the tune of 1.2%. Anytime this stock falls into the $18 range its an automatic buy. Since last Thursday GE shares have declined 3% pushing its dividend yield to 3.5%. GE today is at $19 a share with a 15.5 P/E. General Electric is safer way to play the U.S. financial sector with global conglomerate revenue growth to boot.
GE has done everything in its power to downsize GE Financial and grow everything else under its umbrella. Review What's Driving Growth for GE? | Isaac Pino?
to get an idea of how GE is going to keep its momentum in 2012 and beyond.
Since last Thursday Monsanto (MON) shares have come down 4.7% to $72.09. MON now pays a 1.66% annual dividend yield. Mastery expects Monsanto to bounce back after everyone realizes the sell-off was not justified for this global AG play. Monsanto recently upped its earnings per share estimates for 2012 from $3.34 - $3.44 to $3.49 - $3.54. Don't forget that MON has beat earnings estimates for the last five quarters.
Chesapeake Energy (CHK) shares have been in jeopardy ever since the CEO got busted for using the company as his personal debit card. CHK is down more than 30% since March 1st, its ugly. Chesapeake is now trading in the $17 range and pays a questionable 1.99% annual dividend yield. CHK shares are 6.8% away from their 52-week low. The lawsuits are being piled up against CHK from angry shareholders. Thanks to all the publicity its destined to push shares even lower.
Chesapeake will survive this crisis. Today Credit Suisse lowered their target price to $31 but believe "the concerns about CHKM’s corporate governance and relationship with Chesapeake Energy (CHK) are overdone and units present a compelling value opportunity at current levels." Mastery recommends waiting for another bottom, then jump in with a small position.
MASTERY Bottom line:
Contrary to popular belief, the world is not coming to an end because Greece and friends don't want to pay their bills.
GE, MON, and CHK are classic stock picks that are destined to bounce back when sanity returns to the market.
3 STOCKS TO BUY NOW