How To: Investment for 2017
By Xyla Joelle L. Fernandez
Dec 19, 2016 05:16 AM EST
Dec 19, 2016 05:16 AM EST
Do you want to now the best bets this 2017? Well, here's a panel of seven investment strategist sharing their top stock market picks for 2017.
1.General Motors(GM) by Michael Palumbo
Michael Palumbo is the founder of Third Millennium Trading in Chicago, Ill. and author of Calculated Risk.
There is concern that the current business cycle for automakers has peaked. This may be true. But I do not foresee a significant downturn from here because the cycle has not been robust. Any downturn will, therefore, be insignificant. I do not see earnings to be significantly adversely affected.
A $500 million investment in Lyft will allow the firm to be well positioned as ride-sharing and autonomous vehicles become more widespread. Earlier in 2016, GM purchased Cruise Automation, which specializes in software for autonomous vehicles.
General Motors' latest effort, the Bolt, is a long-range autonomous electric vehicle that will be available initially for Lyft customers as shared autonomous vehicles. General Motors currently trades at a price-to-earnings ratio (P/E) of 4.3. Firms that trade at P/Es this low usually face incredible headwinds.
2.One Gas(OGS) by Winsor "Skip" Aylesworth
Winsor "Skip" Aylesworth is VP portfolio manager at Hennessy Advisors with $6.7 billion under management in Novato, Calif.
ONE Gas distributes natural gas to homeowners, commercial and industrial users in its service territory of Kansas, Oklahoma, and Texas. From an investor point of view, this focused business has generally been immune to the wide swings in commodity prices for both oil and gas.
If an investor would like to participate in the growth of the natural gas boom, ONE Gas should be on your radar and after acquiring an initial position. Additions could be made on price weakness.
3.USG Corporation(USG) by Gregg Sgambati
Gregg Sgambati is head of ESG Solutions at New York City-based S-Network Global Indexes. It publishes over 200 indexes, which serve as the underlying portfolios for financial products with more than $6 billion in assets under management.
USG Corporation (USG) is an interesting investment for 2017 that will give you exposure to the green building boom. Only 14 companies in the building products sub-industry have disclosures for "Green Building Policy." USG stood out on this list because of solid fundamentals and sustained year-on-year sales growth.
4.Indpendence Realty Trust (IRT) by Brett Ewing
Brett Ewing is the chief market strategist at First Franklin Financial Services with $110 million under management in Tallahassee, Fla.
The catalyst for Independence Realty Trust (IRT) in 2017 lies in its necessity for an equity raise. For years now, IRT has been held down by the fact that it pays fees to an external advisor based on a number of assets under management inside of the REIT. Investors always rightly worry about conflicts of interest with a REIT that is externally managed and whose incentives lie in buying as much as possible, not making as much as possible for shareholders.
5.Fortera (FRTA) by Eric Marshall
This recent IPO is a water infrastructure products producer that should see nice secular demand over the next few years. Forterra (FRTA), with roughly $1 billion in annual revenues, has built a platform to add additional infrastructure products.
6.Dycom Industries (DY)
Dycom Industries (DY) is one of the nation's largest specialty contractors whose business is driven by the capital expenditure plans of the cable and telecommunications industries. In a market trading near all-time highs, investors are best served by stocks - like Dycom - that exhibit superior organic growth attributes at reasonable valuations with stock prices below past peaks.
IBM is a turnaround story. "Big Blue" is transforming its business to meet the needs of the new era of cloud, mobility, security, and artificial intelligence. IBM's transformation had begun to show some improvements in 2015. It gained momentum in 2016. I think it will continue to bear fruit over the next few years and lead to higher revenues and profitability.
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