Recently, I wrote about 5 stocks that could outperform Apple shares, see that here. This is part two of that original article and offers 6 more stocks that could outperform Apple shares. While Apple stock is likely to push higher and perform well due to excellent execution and strong consumer demand, the stocks below have a chance at outperforming due to extremely low valuations and low expectations. One potential problem with Apple is that everyone loves it, whereas these are not well-loved stocks, they are contrarian and in some cases lesser known companies. A combination or low expectations and low stock prices could take these shares much higher. Clearly, I would not sell Apple shares but I would look at these companies as high potential candidates:
Hartford Financial (HIG) shares are trading at $17.34. HIG is a leading insurance company. The 50-day moving average is $20.95 and the 200-day moving average is $25.33. This stock has been impacted by storm losses, legal expenses, and a major market correction, but this has created much lower prices and a great buying opportunity. Earnings estimates are about $2.96 for 2011, and are expected to jump to nearly $4 per share in 2012.
Why Hartford could outperform Apple shares: Hartford is extremely undervalued and that could lead to out-performance in the future. HIG pays a dividend of about 40 cents per share, which is equivalent to a yield of about 2.4%. This stock is trading well below book value which is stated at $47.43.
E-Commerce China Dangdang (DANG) shares are trading around $7.20. Dangdang is based in China and is often likened to be the Amazon.com of China. These shares have fallen from a 52 week high of $36.40. This company is focused on building infrastructure and preparing for significant growth just as Amazon.com did in the early years.
Why Dangdang could outperform Apple shares: The Dangdang website is already ranked as the 72th most popular site in China, and will probably continue to climb over the years. See the website rankings here. If you did not buy Amazon.com in the single digits, this might be a second chance. DANG has a current market cap of about $574 million and a enterprise value of about $299 million due to the cash on the balance sheet of roughly $257 million. The potential of this company is far greater than the current enterprise value and with the stock trading at bargain levels it could easily outperform. With DANG shares you get to put yourself in front of some massive trends for the future including: a huge and growing population in China, rising Internet use, growing consumption and disposable income in China.
Vistaprint (VPRT) shares are trading at $29.08. Vistaprint offers online printing services and products for business. The shares currently trade below the 50-day moving average of $34.42 and the 200-day moving average of $45.31. These shares have traded in a 52 week range between $25.70 and $56.25. Earnings estimates for VPRT are about $1.63 per share for 2011.
Why Vistaprint could outperform Apple shares: VPRT shares fell sharply after earnings were reported. The stock was at about $45 and has dropped to about the $26 level. This stock has already rebounded somewhat, but if it retests the recent lows around $26, it looks like a solid buy. This company continues to take away market share from smaller companies and there is no reason why this trend won't continue to boost results for Vistaprint.
Catalyst Pharmaceutical Partners, Inc. (CPRX) shares are trading for about $1.60. Catalyst has exclusive worldwide licenses to commercialize CPP-109 and CPP-115. The company is working on a clinical trial, the majority of which (about $7.2 million) is being paid by the government. The trial is for CPP-109, "Vigabatrin" to treat cocaine addiction. Two drug addiction treatments from Reckitt Benckiser have achieved blockbuster status with combined U.S. sales of over $1 billion. This shows that Catalyst has the potential to bring a blockbuster drug to market. Cowen and other top analyst firms have recently started to cover Catalyst and have given the shares a buy or outperform rating.
Why Catalyst could outperform Apple shares: The stock is undervalued and little known by most retail investors but smart money institutions and mutual funds have been buying CPRX shares. CPRX management owns a few million shares, plus Fidelity Funds (FMR, LLC) owns over 7% of Catalyst Pharmaceuticals, and Federated Investors, Inc. owns nearly 15% of the company, see that here. Catalyst investors could get good news soon as the company has set a goal for a possible partnership agreement in 2011. Also, the company recently announced initial positive efficacy results for CPP-115 and that it significantly reduced infantile spasms. Catalyst expects to file an IND for CPP-115 during this quarter. Analyst price targets range from $4 to $7 for CPRX shares.
Marathon Oil Corporation (MRO) is trading around $24.90. Marathon is an oil and natural gas exploration and production company. These shares have traded in a range between $23.32 to $54.33 in the last 52 weeks. MRO is estimated to earn about $3.64 per share in 2011 and $3.96 for 2012.
Why Marathon could outperform Apple shares: Marathon is very oversold and undervalued. MRO pays a solid dividend of 60 cents per share which is equivalent to a 2.4% yield. The stock is just barely trading over book value which is stated at $23.40. Oil prices have remained relatively strong in the face of weak markets and recession concerns, but have started to rebound back over $90 per barrel this week. If oil remains at $90 or goes higher, this stock could go back over $30 soon.
Huntsman Corporation (HUN) is trading around $12.12. Huntsman is a specialty chemical company and is based in Utah. These shares have traded in a range between $9.47 to $21.52 in the last 52 weeks. Earnings estimates for HUN are at $1.85 in 2011 and $2.24 in 2012. The book value is $8.76 per share. This stock has plunged close to 52 week lows over concerns that the economy is going into a recession. HUN pays a dividend of 40 cents per share which provides a yield of 3.4%.
Why Huntsman could outperform Apple shares: This stock is trading at bargain levels due to recession concerns and a market correction. Insiders have been buying repeatedly, Jon Huntsman just bought over $2 million worth of shares. See the insider buying here.
Apple, Inc. (AAPL) shares are trading at $384.27. Apple is a leading maker of computers and mobile devices. The 50-day moving average is $376.23 and the 200-day moving average is $347.79. Earnings estimates for AAPL are about $27.41 per share in 2011 and $32.12 for 2012. The 52 week range is $235.56 to $404.50. The market cap is about $357 billion and that makes Apple one of the most valuable companies in the world today. If Apple stock were to double it would have a market capitalization of over $700 billion, a value that no company has (apparently) ever achieved.
The data is sourced from Yahoo Finance and Prontosec.com. The information and data is believed to be accurate, but no guarantees or representations are made. Rougemont is not a registered investment advisor and does not provide specific investment advice. The information contained herein is for informational purposes only.
Disclosure: I am long MRO, HIG, CPRX, DANG. I may buy HUN and more of all of these stocks soon.