My 3 favourite stocks with a good one-year outlook
Last Thursday an attendee to our subscriber-only
I chose one year because many investors can cope with a short-term loss on a stock tip but if a good result takes much more than a year to show up, then you're really pushing a friendship.
Also the analysts surveyed by the likes of FNArena would be making their calls on a much shorter timeframe than a medium- to long-term investor.
To illustrate my point, I reckon CBA will be a
And if it only makes
That's all and good but what stocks do I like now for a one-year hold?
I think the tech stocks we know will do OK and the new ones could spike but I'm not usually a punter on new companies. My ZEET stocks call was unusual for me but all four did have some decent form to read, so they weren't all fingers crossed tech-specs.
Before deciding what stocks I like, let me set the scene based on what I suspect lays ahead in 2021. Here goes:
- The US election result won't be a huge issue and could provide a buying opportunity. Business might prefer Trump's tax policies but Biden's stimulus will be bigger. And some quarters might want less Trump unpredictability.
- A vaccine will show up and over 2021 more and more people will be vaccinated.
- This will help confidence and business will head towards normalcy but it could take a year or more for that.
- Economic growth will pick up globally and at home, with the stimulus helping stock prices.
- There could be some market sell-offs but as long as a vaccine looks imminent, I'll call these buying opportunities.
I was asked for three stocks but I like to over-deliver, so I will give five from my longer list of seven.
The seven and what the analysts expect happens to their share price were:
If I was forced to pick three, I'd go for
I think these miners are a safe play, while South 32 (S32) could be the sneaky chance for a big result. It's a second-grade player compared to BHP and Rio, but with its diversity of resources and the likelihood that a global economic bounce-back will increase the demand for many resources, this could explain why the analysts think the company could spike 27.7%.
And before the Coronavirus crash, it was
TLS 5-year
On the subject of companies with potential, all our big four banks should benefit from a better economic growth year in 2021. Also, the Federal Government's desire to end responsible lending should increase the number of loans and banks' bottom lines.
I've included ANZ because analysts think it has a 11.3% upside, while Westpac only has 8.3%. But both should be beneficiaries of a stronger economy in 2021 and a Government that knows healthier banks are good for the economy.
I like
The company says the Victorian lockdown has hurt business and the pandemic has disrupted its lucrative corporate daigou channels.
Sales of shares by company executives wasn't a good look but I think as international trade and tourism reasserts itself, this company is likely to see its share price rebound.
In June this year, this was nearly a
My final selection is
I have to admit liking this headline in the AFR only on
Zip was one of my ZEET stocks. So was ELMO. It's nice when the market agrees with me.
When the share price spiked, this is what the AFR reported: "
This is a company with potential, as it plays in the HR/payroll space and potentially can service businesses with many modules that help create better operations. The chart below shows how it has performed well since mid-2017. I liked how it bounced out of the Coronavirus crash, hitting a low of around
I like the overseas acquisition and the potential that lies ahead for this business services supply company as business returns to a 2021 normal.
My safest three for a good one-year return is BHP, Rio and ANZ.
My highest returning but riskier three are ELO, S32 and TLS.
And my 'gut-feeling' three are
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