Now that the Boston Celtics are in the NBA Finals, we’ve applied our Wall St. Cheat Sheet investing framework to a few popular companies:
1. Boston Beer Company (NYSE: SAM)
Celebration? Break out the Sam Adams beer! This stock has been hopping higher as craft beers have become more trendy (TREND). The stock also fulfills some of the other most important parts of our Wall St. Cheat Sheet Investing Framework. Here is the C-H-E-A-T:
Catalyst: Summer is here and there’s no better time for a beer. With the Boston Celtics in the Finals and music festivals springing up all over the world, SAM has a lot of revenue opportunities in the near term.
High Quality Product Line: If you’re a beer lover like me, then you know Sam Adams is usually the only craft beer at most restaurants. Luckily, CEO Jim Koch takes pride in brewing delicious beers which are far superior to the basics of Budweiser (NYSE: BUD), Miller, or Coors (NYSE: TAP).
Equity/Debt: SAM has zero debt on their balance sheet. That’s the type of company that can soak up profits rather than spill some for their creditor homies.
A-Level Management: Jim Koch founded this company with a family recipe, and he has treated the business like his family since 1985. We love when passionate founders manage their companies.
Technicals: Below is a chart of SAM. As you can see, you don’t need beer goggles to love that uptrend. But don’t chase the recent run up.
2. Akamai Technologies (Nasdaq: AKAM)
Akamai is a favorite stock among momo traders. The stock is up ~400% since November 2008. Although we think shares are due for a cooling period, there are still some reasons to keep your eye on Akamai:
Trend: Akamai is a leader in the white hot digital content distribution business. As bandwidth continues to increase, Akamai will proportionately increase their addressable market opportunity to deliver more content such as movies, video games, software, and more.
Technicals: Akamai recently created a huge base which has resistance in the $41-$42 range. A healthy development would be for the stock to form a little handle before breaking out to levels not seen since 2007.
3. Procter & Gamble (NYSE: PG)
Procter & Gamble’s Gillette headquarters is in Boston. And when sports and ESPN (NYSE: DIS) heat up, Gillette’s Fusion gets tons of attention from their 18-34 year-old male target demographic. Here are some other things going well for PG (despite the flash crash debacle):
Support: Despite all the talk of sovereign debts and oil spills, consumer staples have recovered nicely. Leaders such as PG are obvious safe-havens for funds who are looking for insulation from financial volatility and erratic returns. PG is the perfect “no brainer” trade if markets sell off hard for psychological reasons.
If you are interested in detailed entry and exit plans for low risk-high reward stocks which meet our proprietary standards, click here for a free trial to our Wall St. Cheat Sheet Premium newsletter written by the Hoffman Brothers.