Sunday 27 May 2012

Another Post: I've Realised Something

   I've realised something... that I cannot go on like this, picking a stock every week. I will soon be having all the stocks in the world on this blog, which I don't want to happen. So, I have come out with a new plan, I am going to recommend a few more stocks, then update their status, then take some stocks out of that list when I think they should go then replace them. All these will be done in the coming weeks since I got quite some time on my hand now. But only for now.
   Here is one more stock I'm recommending:
GNC Holdings (GNC) $39.55
GNC has had quite a steady run since its IPO of  $16 in March 2011, more than doubling in around 15 months. Although this stock is quite a 'newbie' in the market, I like its strong uptrend since its IPO, so here are a few qualities about this one. This company with a market cap of 2B has been a raging bull even in corrections, like Ross (ROST), the stock featured on my previous post. This is what I like, stocks with strong numbers, a strong uptrend, with strong fundamentals that can survive recessions and corrections, without impacting my portfolio much, while other stocks are diving off that 10m diving board elsewhere. Preservation of capital is one of the most important rules to me and one very fundamental rule (I feel), for any portfolio. Now, back to GNC, other than being that raging bull running up a hill, it has been crushing analysts' estimates along the way by a wide margin, an average of 36% over the past 3 earnings.Its quarterly EPS(Earnings Per Share) growth rate is at an incredible 106%, with quarterly sales growth rate at 23%. Its EPS rating is at 99, that means its earnings outperforms 99% of other companies. ROE, on the other hand, is at 22%, which shows that its management is doing its job.It also started dividends this year, with a $0.11 dividend quarterly, which adds up to $0.44 per year, or 1.11%. Although this is only mediocre, it is already a good job for a company which only had its IPO not too long ago and is just revving up. It also has some stock repurchasing plans, since last December. This shows that it is trying its best to give shareholders maximum profits. GNC is present in 53 countries around the globe at more than 7600 locations, including Singapore. I must admit that I do not go there very often but what I know is that it offers a variety of products like health supplement products, vitamins, minerals, herbs. People these days are undoubtedly getting richer and more educated, and almost all know the importance of the health. Therefore, I believe that GNC will thrive not only in Singapore but also in other countries. But, one thing that must be noted is its high Debt/Equity ratio of 0.85. Another thing to note is its competitors, there is some competition in its industry with companies like Vitamin Shoppe (VSI) but I believe that GNC will beat VSI because, firstly, the latter only has exposure in 40 states in the USA compared to GNC's 53 countries and that GNC has much better numbers than VSI.(Like Sales, EPS, etc.) Another advantage that GNC has is that it is relatively undiscovered. Not many watch it or even know about it. I feel that this is a really good buy now, also since it just pulled back a little.

EG.Ticker  Price Now  progress since recommendation   price at recommendation

In the portfolio:

  1. DIS 44.50 ^2.16% {43.56}
  2. T  33.69 ^1.20% {33.29}
  3. KMB 79.46 ^1.45% {78.32} -- Not written about
  4. MCD 91.05 ^1.12% {90.04}
  5. ROST 62.47 ^0.47% {62.19}
  6. GNC 39.55 ^0% {39.55}





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