Invest Like a Supervillain
Mike is a member of The Motley Fool Blog Network -- entries represent the personal opinion of the blogger and are not formally edited.
A neer-do-well without any money is just a common criminal. But if you clicked on the headline link for this story, that's not you. No, you aspire to something greater: Supervillainy. What separates the Supervillain from the petty thief is a base of wealth to carry out your wide-ranging schemes for world domination. Secret lairs, doomsday devices, legions of minions; those things don't come cheap.
But what if you don't have the money to make those dreams a reality? You can grow the wealth you need by building up an investment portfolio and following the advice of Peter Lynch in his book, One Up On Wall Street: buy what you know. Investing in the companies or industries you know best gives you an inside track to beat Wall Street. So let's look at a few of the companies that I think are most relevant to the Supervillain industry.
The first thing every Supervillain needs is a secret lair, preferably some sort of underground bunker on a private island. And while most of the leading underground bunker manufacturers are small, private companies, the one thing these bunkers all have in common is concrete, and lots of it. What company can deliver concrete to you anywhere in the world? Cemex (NYSE: CX) can. Cemex has rapidly expanded in the past decade from its base in Mexico to become the largest international cement and concrete company in the western hemisphere. Laden with almost $19 Billion in debt from extensive expansion just before credit tightened during the recession, there is a lot of investor fear surrounding Cemex right now. But follow Warren Buffett's advice: "Be fearful when others are greedy. Be greedy when others are fearful." Think about who will be pouring the concrete for all the island-based, subterranean lairs of greedy Supervillains like yourself in the coming years, and look past Cemex's temporary financial problems.
Forty or fifty years ago, every Supervillian's lair was outfitted with stainless steel fixtures everywhere. But while that was good enough for the villains of yesteryear, stainless steel is not going to cut it in today's highly competitive world domination market. To keep up with the Blofelds, you're going to want titanium, and there's no better supplier than Titanium Metals (UNKNOWN: TIE.DL), the leading manufacturer and distributor of titanium. Whether you need an indestructible barrier, a durable secret weapon, a suit of armor, or just a shiny trinket to distract the secret agent on your tail, Titanium Metals is your go-to company. There are concerns about shrinking margins and declining cash flow, but demand for Titanium is on the rise, particularly from aspiring Supervillains like you, so the time to invest is now.
In the past, it may have been good enough to just call up Kelly Services (NASDAQ: KELYA) and request to have a few hundred staffers sent over to serve as your army of lackeys. But these days, more and more Supervillains are opting to follow the example of Gru from Despicable Me and grow their own legion of minions. And if you want to get serious about your genetic experiments, you're going to turn to Illumina (NASDAQ: ILMN). With a secret lab full of HiSeq 2500 high-output genetic sequencing systems, there will be no stopping your genetically-engineered mutant army. But you'll need to act quickly, as Roche Holdings is keen to buy out Illumina. This medical research gem may not be available much longer, and wouldn't you rather see its shares controlled by a cabal of Supervillains instead of the biotech giants?
Every Supervillain need a high-tech arsenal of both offensive and defensive weapons. When it comes to detecting intruders, blasting them at close range, or slowly cutting them in half, the answer always involves lasers. And the company that develops, manufactures, and markets the lasers you'll want is II-VI (NASDAQ: IIVI). When it comes time to foil your secret agent's plot to catch you, don't run the risk of using some run-of-the-mill laser-pointer quality product; get a genuine HIGHYAG laser from II-VI. Plus, they don't just make lasers; II-VI is also a leader in infrared, high-power microwave, and other electronic and optic technologies, which may also prove useful for your schemes. Some investors are concerned about II-VI's rising inventories, but maybe management is accurately predicting and preparing for the increased demand of the coming wave of Supervillainry?
While we're on the subject of lair-defense, don't forget to add Discovery Communications (NASDAQ: DISCA) to your portfolio. Discovery may not be an obvious choice for the aspiring Supervillain, but remember that this company is the undisputed expert on sharks, as demonstrated by their annual Shark Week extravaganza. Because what good are your frickin' laser beams without some sharks to mount them on? And with Discovery, you're not just getting the education you need about sharks. Discovery's Animal Planet channel covers a wide array of other useful animals, like snakes and piranhas. And you can't go wrong letting Adam and Jaime show you how to do practical research in the destructive arts on the Discovery Channel's MythBusters show. Discovery Communications has a lot of growth potential, particularly in international TV markets. With Discovery dominating the global media market, they'll make an attractive component of your own plan to dominate the rest of the world.
There you have it: five companies for your portfolio, built around the industries that you, as an aspiring Supervillain, are already familiar with. But this isn't just for tomorrow's Supervillains. In today's hectic world, not everyone has time to devote to taking over the world. Perhaps you just want to make money by riding the rising financial tide of the rapidly expanding Supervillain industry? These companies could be for you too. Just make sure you sell before MI6, G.I. Joe, and the Justice League manage to pop the Supervillain economic bubble.
Motley Fool newsletter services recommend Discovery Communications, II-VI, Illumina and Titanium Metals. The Motley Fool owns shares of II-VI. Gordogato owns shares of Discovery Communications. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.