3 Stocks that are Actually Worth the Investment in 2018

Rank: Baboon | 146

Morgan Stanley's analyst does a yearly review of stocks that they believe will be the best investment for the next year. Last year their predictions almost surpassed the market. I think these analysts are great at their valuation and their opinions should not be taken lightly.

Quote:

We focused on stocks rated Overweight by our analysts that also were favored by our US Equity Strategy Team's "BEST" model, which ranks stocks by expected market-relative performance on a 24-month horizon.

These are three best stocks according to them. First, is IBM as it is currently trading around $143 but they believe it will hit $248 that's almost double your money! Second, is VOYA is currently trading roughly at $38 but they project it at $52 for the upcoming year. Thirdly, is SLB as it is about $63 and they believe it will reach $90.

I don't know about you guys but I think it doesn't hurt to invest a little in one of these companies. So what are your guys' top stock pick for 2018?

Comments (66)

 
8/28/17

I'm mainly looking at Marijuana (In Canada, it's bound to be legalized soon), Gold stocks (Lot of political drama) and Alibaba (Has provided me with great returns in the past). I'm also trying to find lumber companies because of Trump's duty on Canadian lumber. Bound to be one stock that adjusts to it well enough to impress investors.

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8/31/17

That is interesting that you say gold as one of your investments to look out for. It has been a great return so far where do you see it reaching before it falls again?

 
 
8/31/17

Personally, I don't know what to expect for their future. The volatility of the market trend is somewhat crazy over the months. But I think there's nothing to worry about with the company since it's still generates revenue. If you aim for long term investment, I think its worth the risk. I don't have the data to show since, I'm not a data scientist in this field lol. But if I based it on your post, its never too late to compete! The company should change their strategy to boost their income because there are plenty of competition in the market and now their biggest competitor is Amazon. I'll ask my investing group about this at www hashtaginvesting [dot] com

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8/31/17

I agree that they are a solid company and it will be hard for them to go out of business. I want to hear your group's opinion. Please let them share their opinion here.

 
 
8/31/17

Very interesting article and question. I believe that the FAANG stocks have truly run their course and been successful, but are on track to lose their bite. Only time will tell!

 
8/31/17

I don't think the growth rally has run it's course. I think with all the new technologies being developed, especially AI, Big Data and Machine learning the golden days of FAANG companies are not yet over.

 
8/31/17

I would not put all the FAANG stocks in a single bucket (i.e. Long-only/Short-only). Netflix, Alphabet and Amazon have continued upside potential given the strength of their products and dominant position relative to competition. I see no imminent headwinds that would precipitate a drop in their stock prices, and I don't consider them good candidates for shorting. Apple and Facebook's competitive position is relatively weaker, and hence are more prone to a momentum reversal trade (triggered by company news that may not meet market expectations or better than expected news from one of their competitors) and would be good candidates for shorting.

 
8/31/17

That's true. Netflix might be one of the hottest stocks of FAANG at the moment. Its business model of investing in original content will continue to generate subscribers for years to come. Year-over-year subscriber growth has exceeded 20% in each of the past eight quarters, and international subscriber growth has skyrocketed recently. Online access is exploding in places like Asia, Latin America, and Africa, which will only further allow Netflix to continue expanding its international consumer base.

 
8/31/17

My mantra when it's come to playing overpriced growth stocks (specifically FAANG) has been to never short quality -- if it's indeed true that market pricing is becoming increasingly separated from fundamentals be it due to the rise of quant or passive, then shorting a company like Apple or Facebook is bound to get you burned unless you have extremely high conviction in the short-term.

 
8/31/17

That's a good point. One could certainly argue that the FAANG stocks are overpriced, but they're growth stocks and it doesn't like they're going down anytime soon.

 
 
8/31/17

This is mostly because of President Donald Trump's defense budget, which promises the Pentagon an extra $54.0 billion in military spending.
according to my knowledge you should invest in defence stocks under trump for better growth.

 
8/31/17

Anything defense, oil & gas, and financial services

"Even if you're on the right track, you'll get run over if you just sit there" - Will Rogers

 
8/31/17

Defence, go for the big ones. LMT, BA, GD, etc.
Wouldn't count on O&G - too much volatility in the oil markets
Financials, prepare for the shitstorm that's about to come because of massive overpricing during the rally.

Ideally, you should be looking not at the industries he said he'll support, but rather the industries closer to his network (read Jared, Schwarzmann (Basically any opportunity BX is looking at) and Thiel). Because frankly, the only thing he's actually dictated in numerical terms is the defence budget - everything else is a sham.

GoldenCinderblock: "I keep spending all my money on exotic fish so my armor sucks. Is it possible to romance multiple females? I got with the blue chick so far but I am also interested in the electronic chick and the face mask chick."

 
8/31/17

Arts and crafts stores who sell poster boards

"I like Ackman," Mr. Icahn said. "I'll tell you why I like him. Anyone that makes me a quarter of a billion I like."

 
8/31/17

:)

If you find yourself feeling lost, go climb a mountain.

 
8/31/17

Thermal coal producers in the interior such as Illinois Basis. Be weary of coal outside of this region as the cost advantage of producers like ARLP is huge. Valuations are arguably still shit even after the recovery, check out the stuff the EIA publishes, given the general sentiment surrounding coal, its unreal the projections being reached for both production in the Illinois basin versus other regions as well as the predictions regarding nat gas versus coal.

Financial Services especially banks - rollback in reg with int rate increases should translate to some degree of net interest margin expansion, how much gets passed along to depositors is another question. Also been a huge swing in banks, could see a good entry point after a correction which is likely coming. Also regional banks should do well on a long-term but again these got a overbought in the rally.

Second anything defense.

Kind of a "next big thing" type thought but I think travel related/experience economy/sharing economy type shit will do well. I definitely need to do more research. Obviously pure plays aren't as easy here as well but it's insane how much Millennials like to travel. Social media will continue to open the world electronically which I think is going to translate to just crazy travel/a thirst for experience for young people. Its insane how much some of my friends like to travel, like they might not open an IRA until they are 30 and have no conception of personal finance but they legit set aside money to travel. It's just baffling how much of a priority it is for people. I also watched a presentation by the founder of zipcar and some of the stuff she talked about is just crazy regarding how the auto sector is going to completely get disrupted in the next 10 years. Thinking about cars objectively, there's so much inefficiency in owning a car especially in urban scenes and some older people might not buy into it but it's very likely we see significant changes in the car ownership model with younger generations.

 
8/31/17

I'm overweight hair and tanning supply stocks.

 
8/31/17

Currently prepping for that exotic pelt rally, so i guess long anything Canadian circa 18th century?

 
8/31/17

I'm looking at 60% upside when the fake news establishment finally fails tremendously. Look for players like Breitbart, Fox News, and Info Wars to shoot up in value.

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8/31/17

That's why you pair diversification with proper due diligence. To answer your question, yes it is worth investing your money in the stock market

 
8/31/17
"Spartan3160" wrote:

That's why you pair diversification with proper due diligence. To answer your question, yes it is worth investing your money in the stock market

Seriously - but how do you do enough diligence ? There's way more to stock market investing that the crap out there in all those general "here's a 100 bagger" type books.

Example:
BP Deepwater Horizon - that rig blew up in the ocean seafloor of Louisiana's offshore and led to a stock price fall from $58 to $20 something.

Asset expropriation in sh!thole third world nation = your mine in some African nation is churning out big money and helps P&L - suddenly there's a back-tax allegation and now your liabilities side of the balance sheet is looking at a $10 billion bogus fine (what it really means is the ministry of mines and energy guy wants you to route $10 million to get rid of the case along with buying him a New House)

--
Seriously, sometimes I feel you need cameras at the physical operation at the company's asset/worker location to be aware of all the sh!t that could be hitting the fan.

This is far beyond due diligence , it requires a certain level of paranoia.

 
8/31/17

It is called risk. Without it you have no reward. This why you diversify.

Only two sources I trust, Glenn Beck and singing woodland creatures.

 
8/31/17
 
8/31/17

Papertiger might as well burn your money or hide it under your Mattress bud. Leave the investing and trading to us pros. Why would we invest a huge portion of our money into an African Mine stock? lol

 
8/31/17

You guys are picking on me.

I'm saying - did you guys ever get hit with unforeseen developments in real company physical operations ? A corporate event ?

That's not something even a PhD or a CFA Charterholder can expect - like a factory blowing up, or an asset being expropriated.

This shit is purely unsystematic, company specific risk. All i ask is - do you guys expect these and do you buy knowing this.

 
8/31/17

That is why I own a very diversified portfolio of Vanguard Index Funds. VTI, VEU, and BND are the only three I own. I don't have to worry about stupid shit happening to a specific company because I own a piece of the whole damn market. Pretty simple to do. Commission free at TD Ameritrade as well.

 
8/31/17

Company specific risk can be studied and analyzed. You are talking about unforeseeable risk that is pretty much impossible to forecast. This is where modern portfolio theory and diversification comes in to alleviate the risk exposure in this type of risk. Also when investing in the stock market you are investing in these types of risks, risk and rewards are somewhat proportionate. That's why the stock market typically has the biggest rewards to compensate you for these risks. There are more unpredictable factors (risk) in the stock market than the bond market, and as the golden rule says the stock market provides typically better returns on the upside.

 
8/31/17

I think this is a troll, but I'll bite.

Both things you stated as influencing the stock price negatively are short term hits, investing is about the long term prospects of the company, do you believe in the product, management, business model, etc. trading is more about the short term results of a company.

Keep an investing journal, or some sort of notes surrounding why you are purchasing said stock, so when they do take negative hits like this, you are able to look back and see whether or not the reasons you purchased the stock in the first place are still valid.

The solid blue chip stocks usually return more than the index itself and if you are curious jump on and have a look at the return you would have accumulated from year x to now, I bet it is much more than the loss you would have accumulated from keeping physical cash and have it eaten away by inflation.

'I'm jacked... JACKED TO THE TITS!!'

 
8/31/17

hell nah dude I'm not trolling.

Look. If you invest in a global mining empire with mines across the world, say in countries with few redeeming qualities as far as governance is concerned, it's a serious issue.

When REAL ACTIONS affect REAL UNDERLYING EVENTS that's just super scary.

Example (real):
Barrick Gold is a Canadian mining titan, the world's largest gold miner. One of its major mines in Tanzania was barred from production overnight because the leader of that country thinks Barrick is ripping them off by underreporting exports and production to get less in royalty and tax charge.

This is serious stuff.

 
8/31/17

I'm really ashamed of myself now.

'I'm jacked... JACKED TO THE TITS!!'

 
8/31/17

The main thing thing you should be focusing on with equities is understanding a mix of tech, fundamental, relative value, top down, and bottom up analysis. You have to be able to look at a situation from all angles, which is tough. Focusing just on financials will get you nowhere, especially if you're just identifying intrinsic value opportunities. Personally, I just use equities to beat out inflation and that's because my expertise is in credits. But if you're good at identifying and reacting to information quickly to trade on you can make some money on stocks.

 
8/31/17

btw do you guys read auditor's qualified/unqualified remarks ?

 
8/31/17
"papertiger" wrote:

btw do you guys read auditor's qualified/unqualified remarks ?

Generally no. I tend to think of auditors as number crunching service sector parasites. Definitely pay attention to the balance sheet, income statement, & statement of cash flows though.

 
8/31/17

Knowing a buddy that works in audit, can confirm that he's a parasite.

 
 
8/31/17

So basically, Walmart is becoming Amazon while Amazon is becoming Walmart.

 
8/31/17

Exactly, Jet.com has almost identical pricing model as Amazon's prime. Seems like price war there has already heated up pretty big.

 
8/31/17

Amazon is going to mop the floor with Walmart.

 
 
8/31/17
 
8/31/17

Is it really the bad time to own stocks?

 
8/31/17

if you're not already in, raise cash and buy on the pullbacks and corrections

 
8/31/17

Feel like the market has learned to ignore these empty threats from NK: short-term selloffs -> quick recovery. The fact that China is willing to enact sanctions against the country should further discourage them from making any meaningful advances. Trump trade is also slowly getting priced out. Just look at the Russell's recent performance to get an idea of what I mean.

Broad correction will occur due to balance sheet trimming by CBs. There is so much liquidity out there and we're all in for a bit of a rude awakening once it dries up.

 
 
8/31/17

Is that it? No background no nothing?
Weak.
Edit: unless you wrote the article you are linking to that is... But if it's just a copy paste...

 
 
8/31/17

Fintech companies (also their IPOs)

The name of the game, moving the money from the client's pocket to your pocket

 
8/31/17

Maybe better several days after IPOs...

 
8/31/17

Check out BAMI IM

I'm talking about liquid. Rich enough to have your own jet. Rich enough not to waste time. Fifty, a hundred million dollars, buddy. A player. Or nothing.

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8/31/17

Hi Wolf of Flinders Street, the silence is deafening, sorry about that.... Any of the threads below helpful?

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  • Should You Short These 5 Hot Growth Stocks? bears are right and the 2017 growth rally has run its course? Or will shorting the FAANG stocks continue ... Facebook, Amazon, Apple, Netflix, and Alphabet have been some of the hottest growth stocks of ... stocks in recent weeks, with Netflix leading the pack as the hottest stock among short sellers. According ...
  • Is value investing dead? value investing dead? Do you think the earnings projections for certain growth stocks are on the wild ... "value" stocks slid, an unusual separation. Growth and value stocks in the U.S. returned the same from the ... have a value gap that is so extreme that quite often that can act as a catalyst for
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  • More suggestions...

Who will rescue this thread? @KingAlpha @Matthew123 @shuckjones

Fingers crossed that one of those helps you.

 
 
8/31/17

You could literally write a 500+ page book on different investing styles...

 
8/31/17

GARP has been really good for me. General rule of thumb is to understand free cash flow.

 
 
8/31/17

Hey ReachThePeach, I'm the WSO Monkey Bot and I'm here since nobody responded to your thread! Bummer...could just be time of day or unlucky (or the question/topci is too vague or too specific). Maybe one of these topics will help:

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  • 2018 FT/Off-cycle London Recruiting Timeline Megathread UPDATED AS OF 01/11/2017 Title says it all- the 2018 FT IB mainly covers the US schools so ... networking invite, apparently offers are out) JPM: Open- received email saying that my application was under ... consideration now lol MS: Closed (early bird closed 31st July 2017, someone has said that recruiting is over) ...
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  • More suggestions...

Calling relevant pros to the rescue! @brennpa @HashtagCorpDev @NewYork7

Hope that helps.