Stocks to Watch

Altria (Philip Morris), Diageo, McDonalds and Microsoft.

A long time ago I used to work on Wall Street. For many years, I’ve thought stocks were way too expensive to be an interesting asset class.  For better or worse, they are starting to look attractive again and I can’t help but write about some of the stocks I think are worth keeping an eye on.    With the market down as far as it is,  stock prices are starting to reflect the reality of underlying fundamentals. But keep in mind that the downturn in the market may have a ways to go -driven by people being spooked or needing cash and therefore pulling money out of the market.  

I am not a registered or licensed stock broker. These are strictly the opinions of someone who enjoys the market as a hobby. I do not actively invest and have not, for years. My efforts are focused on growing our company, Vertabase (because I believe in the rewards of enterpreneurship and creating and selling products that add value).  That being said, I do own some individual stocks (outside of those in mutual funds). If I write about them I will tell you.

So, here is a short list of quality shares which could be bought on the cheap. They may yet get cheaper but they stand a good chance of making it out of the current bear market as being great investments. They are consumer staples that can generate cash.

Altria (Philip Morris) -MO
McDonalds -MCD
Microsoft -MSFT (I own Microsoft stock.)
Diageo -  DEO

Here are two strategies for approaching those stocks. 

1. For those who need to be in the market, I would recommend buying on the way down.
2. For those who can sit on the sidelines, keep an eye on these stocks. Put them on a watch list. Buy them when you feel you could sleep well even if, in the short term, they fell below where you bought them.

The affect of retail investors pulling money out of the market in general, cannot be overstated. It can continue to put downward pressure on stocks in general for a while.  If there’s interest, I could do an analysis on how much money is left that could be pulled out and how long the effect of declining retail investment in the market could last.  Just let me know in the comments.

    

This entry was posted on Thursday, October 9th, 2008 at 10:37 pm and is filed under The Market and Economy. You can follow any responses to this entry through the RSS 2.0 feed. You can leave a response, or trackback from your own site.