Your Prey for 2006

As 2005 come ups to an end, investors celebrate the approaching new twelvemonth and convey new outlook with it. As investors, we seek to sell our losing investing before the twelvemonth stops and sell our winning investings after the new year. This is to have the benefit of early tax tax deduction and deferring our tax liability. Either way, after merchandising your investment, you have got some trim cash to invest. Therefore, you would need some thought on where to put your money.

Scouring the 52 hebdomad low is normally a good topographic point to start. Tax loss merchandising have made many pillory to do the list. This is great for us, small investor. Barring any cardinal news, cheap pillory that get cheaper volition be a good investing candidate. Turnaround investors look for pillory that are touching 52 hebdomad low and starts researching them. Many of them bounces, providing investors with outstanding return. Examples for this twelvemonth include: ATI Technologies Inc. (ATYT, up 39% from the low), Seagate Technology (STX, up 29% from the low), Omnivision Technologies (OVTI, up 68.8% from the low) and even Maxtor Corp. (MXO, up 45% from the low before being acquired). Maxtor is now trading 120% above its 52 hebdomad low.

While pillory touching new 52 hebdomad low, make not always bounce, this is a good topographic point to begin your research. Therefore, your quarry for 2006 should at least include companies that have recently touched 52 hebdomad low. These are respective ideas to get you started for 2006.

Pier One Imports Inc. (PIR). The retail supplies specializing on piece of furniture and other cosmetic accessories, are experiencing client desertion this year. Same shop sales have been declining and there is small indicant that it will change. Robert Penn Warren Buffett used to have a piece of this company. He have since cut back on his interest late this year. It have recently fallen to $ 8.90 per share from the 52 hebdomad high of $ 19.98, a 55 % hair cut.

Shanda Interactive Entertainment (SNDA). For overseas exposure, especially China, Shanda should be on your ticker list. It supplies online gambling to the Chinese community, especially Massively Multiplayer Online Function Playing Games (MMORPG). Don't allow the word scare you. It is basically an online gambling portal where it allows gamers fight/play with other gamers. A good manner to further customer's loyalty is through the interaction with other individuals. Online Gambling supplies Shanda with that opportunity. It have fallen to $ 15.00 from its 52 hebdomad high of $ 45.40, a 67% hair cut. The appealing thing about Shanda is its strong balance sheet (more cash than long-term debt) and the possible growing of its market. Furthermore, the company is profitable. Those cash heap will go on to turn if that happens.

Navistar International Corp. (NAV). This company do and administers commercial motortrucks and busses. Competitors include Paccar, Volvo and the like. It is sporting a forward P/E of 6 and nice balance sheet. If it can keep a 0% growing in profits, the stock terms won't merchandise at $ 28.80 for very long.

Verizon Communications Inc. (VZ). The largest babe bells of all are having a nice twelvemonth on the net income line. However, concerns about competitions and high debt load, have reduced its stock terms for twelvemonth 2005. It is currently trading at $ 30.27 per share with dividend output of 5.30%. Currently, dividend is about one-half of its annual profit, which is considered safe. If Verizon can reiterate its net income performance, the dividend for 2006 will be safe. However, it currently have a high debt loading of $ 34.3 Billion. The company have tried to reduce its debt using its cash flow from operations. On December 31st 2002, long term debt stood at $ 44.8 Billion. Therefore, balance sheet have actually improved while stock terms travels nowhere.

Fresh Del Monte Produce Inc. (FDP). The shapers and distributers of fresh fruit green goods is not having a good year. Pricing weakness, combined with the higher than expected cost, have decimated its stock price. Recently, management have reportedly engage JP Morgan to run an auction bridge for the company. It can be sold to as high as $ 1.8 Billion according to TheDeal.com. This translates into $ 30.70 per share. FDP recently merchandise at $ 23.64 per share. If the deal travels through adjacent year, you have got the possible of a 29.9% return. However, the fact that management is exploring the buyout, bespeaks that business aren't so good at this company. If the deal doesn't travel through, stock terms may see additional depreciation.