I Can't Afford That...
Kyle is a member of The Motley Fool Blog Network -- entries represent the personal opinion of the blogger and are not formally edited.
I know, afraid of getting in too late? Just because a stock hits a new 52-week high, you think to yourself, “Man, I missed that one.” Recently a few have busted through their one-year ceilings and don’t show any signs of retreating. Which means there is still opportunity to be had.
If I took a poll of everyone that has some variation of a Visa (NYSE: V) card, what percentage of the free world do you think that would be? How about the percentage of anyone with access to a McDonald’s (NYSE: MCD), and the likelihood that at some point in their lives (far too many times, for a lot of folks), they had savored those addictive fries and heatlamp-soaked quarter-pounders? Let’s see if we can get this percentage a little lower. How about the masses that frequent Starbucks (NASDAQ: SBUX) on a daily basis? I’m guilty of 2 out of 3, myself. I would rather have a Smashburger.
Now consider a few factors when weighing in on these recent high-flyers. This has been a steady process, throughout this volatile year and these folks have been stubbornly gaining, making respected analysts everywhere eat their words. Or, depending on who you follow, they have jumped on the bandwagon.
2012 is an Olympics year. Two of these three stalwarts will be spending a good deal of their revenues on advertising: Visa and McDonald’s. I love the Olympics. I hate the ads. What can you do? As soon as some advertising firm scoops me up, I promise to make them better.
In a nation that is increasingly stretching its waistline, Starbucks is about to make a move into healthy fruit juices, bringing the “Starbucks experience” to a juice bar near you. The company and its shareholders should send a percentage of their profits to Howard Schultz. Think of it as “fiscal tithing.” Since he returned to steer the ship through murky waters, the company has managed a remarkable turnaround.
I am never going to tell you what to buy. I am only here to plant seeds of thought in your financial grey matter. I only own one of the three stocks mentioned. But I would not give it a second thought to “buy and hold” any of these, and neither should you.
The problem many of us “newbie” investors run into is being scared away by what appears to be a stock hitting its top, or looking as though it’s too expensive. Neither of these are true in the case of the three mentioned. I’m not telling you to buck the analysts, or “fade the trade.” If you are going to invest the slightest amount of money, you should do your fair share of research. If you can’t spend at least an hour of time going over one company, you would be better off investing in a mutual fund (we’ll get into that later).
Until next time, from the trading table,
Motley Fool blogger Kyle Metivier proudly owns shares of Visa (V), but does not own shares of McDonald's (MCD) or Starbucks (SBUX).