penny stocks to buy now
The stock market has a tendency to focus on the very short-term and this can often create bargains with superior potential for long-term investors when their looking for stocks to buy now.
This appears to be what is happening right now with the electronic contract manufacturers.
I know it sounds like a mouthful, but this industry is worth a closer look for investors.
You see, the electronic manufacturing services industry has been sadly drifting along with the global economy. Demand for electronics has been held down by a lack of spending at both the consumer and corporate levels.
This combination of weak current business conditions and bright prospects for future growth has created some opportunities for investors to buy selected companies at bargain prices.
And now's the time to scoop them up.
That's because the industry is showing some signs of recovery as demand for some devices, most notably smartphones and tablets, is beginning to increase.
It's not just the mobile wave that'll push this industry into profit territory.
New opportunities will open up for contract manufacturers as the auto industry continues to add electronic features to cars and wireless companies turn toward smart antennas over the next few years. Both industries expect huge sales growth this year. For example vehicle sales are on track to reach about 15 million units this year - a 44% gain from 2009.
To play these areas of growth, here are two electronics stocks to buy now that will benefit as electronic contract manufacturers reap the rewards of increased consumer and business spending.
- Three Stocks to Buy Now
Stocks to Buy Now, or Just Another Fad?
The company this week had to recall yoga pants made with fabric known as Luon because it was overly transparent - meaning Lululemon customers were walking around with see-through pants.
The products make up about 17% of all "bottoms' sold by the company. According to The New York Times, the recall is expected to account for about $60 million in lost sales.
Lululemon investors saw the stock take a 10% hit this week after the pants debacle.
And now, with some of its most popular products off shelves, the company has opened up the window for another "trendy" fitness chain to play to pantsless consumers.
That's one of the dangers of investing in a fad stock - it's not going to be popular forever.
And even though Lululemon's shares have soared more than 340% in five years - beating returns of both Apple and Google - its success isn't based on solid company fundamentals, but on trends and investor hype.
Here are a couple other "fad" stocks that might not be able to deliver for investors on consumer enthusiasm alone.
Stocks to Buy Now Ahead of Major Bank Industry Takeovers
There has been a lot of discussion among investors over the past few years about whether the banking industry offers any quality stocks to buy now.
The big banks brought the economy to its knees in 2008 and had to be bailed out by the federal government with taxpayer dollars. The disastrous decisions at large banks spilled over to the smaller banks and caused severe economic distress for many of them.
Many banks were forced to close with 140 banks failing in 2009 and another 157 in 2011.
Although the numbers have tapered off some we still saw more than 50 banks fail last year as a result of residual problems from the housing boom and ensuing credit crisis. This type of carnage is reflected in the price of many small banks, which are just now starting to see their balance sheets and stock price show signs of improvement.
We now face an environment much like the aftermath of the savings & loan debacle in the late 1980s and early 1990s.
You see, during the economic boom from 2001 to 2007 many new banks opened across the United Sates to take advantage of the cheap money from the Fed and the high demand for housing and home equity loans.
Now in the aftermath of the implosion of housing prices, we find ourselves with too many banks even after all the failures. We have seen some bank mergers in 2012 but this is just the start of what will be a massive wave of bank and thrift consolidation activity.
While we have seen some economic recovery, we continue to operate in a better but not good economy. Loan demand is still fairly tepid and is well below pre-crisis levels. It is difficult for many banks to gain market share and maintain profitability.
As we enter 2013 banks face new regulation and compliance costs that may further crimp operating profits. Smaller banks in particular are experiencing high levels of frustration at their inability to remain profitable and grow their franchise. Shareholders are unhappy after several years of poor share-price performance and want to see a return on their investment.
For many the best path is going to seek a suitor and sell out to a larger competitor.
For investors this creates an enormous opportunity for long-term profits, if you know the right stocks to buy now.