I have one stock picks for 2013 that I believe is both the safest bets you’ll find in the market and has the most upside for serious growth.
But before I get into those picks let’s look back at my 2012 picks. As an official member of the Money Pros financial blogger group, I participated in the Money Pros stock picking contest.
All of the “Money Pros”, which includes 7 personal finance bloggers and another 28 other bloggers and/or blog readers, entered the contest with three stock picks.
There were 35 people picking stocks. I got 2nd place. (if the link above shows me somewhere other than 2nd place, keep in mind that the stocks are still being updated in that sheet every day. I was definitely in second place on Jan 1)
My 3 Stock Picks for 2012
My three choices of Citigroup (C), Sprint (S), and Pizza Inn (PZZI) gave me a return of 51.68% last year. Pretty good huh?
I felt Citigroup was going to have a comeback year specifically because I knew the government wasn’t going to let a bank that big fail and that it’s price was severely beaten down compared to it’s book value and competitors. Today’s price is around $42.43 and I think that’s a pretty fair price. If I were a stock market expert I’d rate Citi as a hold, hoping they will be able to re-institute a solid dividend payment in the coming year.
I also really liked Sprint because AT&T has miserable customer service in some of my experiences and Verizon seems to be very overpriced. There is a big opportunity in the mobile service provider space and Sprint has stepped up to fill that void well in 2012, even if they are still running in 3rd place behind the two giants. I still think Sprint has some room to grow but it’s not one of my top picks for 2013. I’d call it a buy right now, but not a strong buy.
Pizza Inn actually lost me quite a bit of money even though I still really like the business model of their new Pie 5 restaurants. They make custom-made personal pan pizzas right in front of your face. Think Chipotle but for pizza; you pick your crust (thin or thick), sauce (4 or 5 options), and all the toppings you want, all for about 6 bucks. The Pie 5 store near my office is always packed during lunch and I think this is a great business model that will be successful in the future. I would strongly recommend Pizza Inn if they put more focus on expanding on and advertising for Pie 5, but as it stands today I’m lukewarm on their future prospects.
Now that you’ve seen my 2012 picks and I might have convinced you that I have some idea of what I’m doing, here are my two favorite stock picks for 2013.
Silver ETF – NYSE: SLV
It’s no secret that I am a huge fan of silver. Silver is valuable for three reasons: it is used in jewelry, it is a precious metal that has value for investors trying to avoid fiat currencies, and it has some incredible applications in industry.
Did you know that silver is “the best thermal and electrical conductor of all the metals”? There is a lot of great information about silver’s uses in this article at geology.com.
Silver is being used in computers and cell phone electronics. It’s being used in many of the latest solar panel technologies. It can be used to make mirrors. Heck, it’s even used in socks to cure stinky feet because of its antibacterial properties.
There isn’t a single raw material that I think will be more valuable in the coming years for all these reasons, and I think silver is the most important stock and/or physical precious metal for anyone. I already own both physical silver and some SLV.
Peter Schiff is a highly successful investor who predicted the housing crash years before it happened, and his recommendation in 2013 is the following:
You want to avoid the dollar; you want to avoid bonds; you want to be in precious metals; you want to be in resources; you want to invest abroad.
By investing in silver, you’re hitting two of the three categories. You get precious metals and resources at the same time.
I have one investing recommendation in 2013, and it’s silver.
Readers: What are your investment strategies for 2013?