Do you own shares of the hot stocks? You know the ones I'm talking
about.
Apple
Amazon.com
Netflix
Chipotle
Priceline
Most people have at least a few of these, and some
of the other hot stocks, in their portfolio. If you owned them
since the 2009 lows, you've cashed in big.
How good have the returns been in these glamour
stocks since March 9, 2009?
Amazon: 211%
Apple: 300%
Chipotle: 464%
Priceline: 538%
Netflix: 581%
Impressive, indeed. But the well known stocks
aren't the only game in town.
There are companies you may never even have heard
of, some of which are much smaller or in industries that are
considered less "glamorous" by investors, whose returns matched or,
in some cases, surpassed this list of the glamour stocks during the
same time period.
How could that be? What company could beat
Apple???
These 5 little known stocks have also been
champions off the 2009 lows. There's nothing glamorous about any of
them but check out their returns for the same period as the
so-called hot stocks.
1. The pawn shop operator: 231%
2. A fertilizer and grain storage provider: 244%
3. A manufacturer of compressors: 347%
4. The specialty resources provider to the oil industry: 360%
5. An auto retailer: 764%
Just who are these companies?
1. EZCORP
2. The Andersons
3. Gardner Denver
4. CARBO Ceramics
5. Lithia Motors
Not too bad for companies most investors have never
heard of.
But the good news is that all 5 of these companies
still have solid fundamentals including rising earnings estimates
and attractive valuations. All 5 of them are Zacks #1 Rank (strong
buy) or Zacks #2 Rank (buy) stocks.
1. The Pawn Shop Operator
EZCORP Inc. (EZPW) operates 500 pawn shops
and 500 short-term consumer loan stores in the U.S., Mexico and
Canada. In its fiscal second quarter results, revenue jumped 19% to
$131 million. Same-store revenue also climbed 12%. The company
raised full year guidance in April.
It's valuations are still excellent.
Forward P/E: 12.4
PEG: 0.8
Expected EPS Growth: 30%
EZCORP is a Zacks #2 Rank (buy). The rally off the
lows has been impressive.
2. The Fertilizer and Grain Storage
Provider
The Andersons (ANDE) is an Ohio-based
agribusiness company with offering fertilizers, grain storage and
distribution, ethanol, specialty turf products and rail car
leasing. The company reported a record first quarter as earnings
per share jumped to 93 cents, blowing out the Zacks Consensus by 19
cents. Sales jumped 39%.
The Andersons is cheap.
Forward P/E: 9.7
PEG: 0.8
Expected EPS Growth: 16.4%
The Andersons is a Zacks #2 Rank (buy) stock. It
has been a bumpier ride off the March lows for this stock.
3. An Industrial Manufacturer In Business Since
1859
Gardner Denver, Inc. (GDI) has weathered
plenty of recessions and depressions in its time. The manufacturer
of industrial compressors, blowers, pumps, loading arms and fuel
systems which started out in Illinois with one location in 1859 is
now a global player with 40 manufacturing facilities around the
world.
The company had a record first quarter as revenues
soared 26%. It also easily beat the Zacks Consensus Estimate by
20%.
Forward P/E: 16.5
PEG: 0.9
Expected EPS Growth: 43%
Gardner Denver is a Zacks #2 Rank (buy) stock. The
company has attractive valuations despite the shares soaring.
4. The Specialty Resources Provider
CARBO Ceramics Inc. (CRR) is one of the
world's largest suppliers of ceramic proppant for fracturing oil
and gas wells. The company reported the best quarter in its history
on Apr 28 as revenue rose 22% compared to the year ago quarter on
strong ceramic proppant demand in the natural gas and liquids-rich
plays such as Eagle Ford, Permian and the Bakken. Ceramic proppant
demand is hot!
CARBO is the most expensive of our unknown
stocks.
Forward P/E: 27.6
PEG: 1.1
Expected EPS growth: 55.5%
The company is a Zacks #1 Rank (strong buy). Shares
took off in the last 8 months as the energy story heated up.
5. The Auto Retailer
Lithia Motors (LAD) has been selling
automobiles since 1946 when its first retail store was opened in
Oregon. Its retail stores now include 86 locations in 12 states.
Left for dead by investors during the recession due to the near
collapse of the auto industry, the company, which also sells used
cars and provides maintenance, has rebounded.
In the first quarter, revenue soared 31.3% as new
vehicle same store sales rose 41%, used vehicle same store sales
jumped 17% and service/body and parts sales increased 8%. Its
western markets are seeing the economic recovery.
Forward P/E: 12.2
PEG: 0.4
Expected EPS growth of 50.8%
Shares traded as low as $2.01 on March 9 before
surging off the low. It hasn't been a straight up shot though. But
if you held on through the ups and downs, its return is more than
double the return on Apple's shares during the same period.
Don't Overlook the Unknown Companies
While there's nothing wrong with investing in the
hot glamour stocks, if you widen your search beyond the well known
names you might find a hidden gem that pays off just as big.
[Returns data in the article was tabulated from
March 9, 2009 to the closing price on June 8, 2011.]
Tracey Ryniec is the Value Stock Strategist for
Zacks.com. She is also the Editor of the Turnaround Trader and
Insider Trader services. You can follow her at
twitter.com/traceyryniec.
ANDERSONS INC (ANDE): Free Stock Analysis Report
EZCORP INC CL A (EZPW): Free Stock Analysis Report
GARDNER DENVER (GDI): Free Stock Analysis Report
LITHIA MOTORS (LAD): Free Stock Analysis Report
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