Halfway down 2014, when CNBC decided to raise the question of which stocks would fetch greater returns to investors and would prove to be lucrative in the long term, two experts namely Michael Binger of Gradient Investments and Bryan Piskorowski of Wells Fargo provided some deep and useful insights. Ford Motor Company (NYSE:F) and Energy XXI (Bermuda) Limited (NASDAQ:EXXI) are the favorite stocks of Michael Binger.
The first suggestion that Michael Binger made was that of Ford Motor Company (NYSE:F) because he felt that the stock appeared cheap at its current price of $17.42 and a lot of promise for growth in both domestic as also international markets. As of today, Ford Motor Company (NYSE:F) boasts of a current market cap of $67.56 billion and a forward P/E ratio of 9.03. But what makes Ford Motor Company (NYSE:F) a truly attractive stock to own is its 5-year average dividend yield of 3% and a high pay-out ratio of 27%. Courtesy of good future potential, this stock appears attractive as an investment option.
Energy XXI (Bermuda) Limited (NASDAQ:EXXI) is the second recommendation that Michael Binger has made because he feels that the company’s drilling activities off the coast of Mexico is likely to ensure long-term growth and increased revenue for the company. Currently poised at $16.31, stocks of Energy XXI (Bermuda) Limited (NASDAQ:EXXI) have been on a rising trend since it completed its acquisition of a smaller unit in the same sector, namely EPL Oil & Gas Inc. At present, the company’s market cap stands at $1.53 billion and forward P/E ratio is 10.19. The biggest confidence booster for investors is the presence of good management at the helm, the most crucial factor for earnings to accrue.
When asked, Bryan Piskorowski, Managing Director, Wells Fargo, commented that investors must heed street signs prior to picking stocks for investment in 2014 and one of the ways of doing so entailed studying S & P 500 industrials over the months. He also emphasized on the importance of sector while picking stocks and said that much of the growth experienced by the stock would depend on the niche that it belonged to.
This article has been written by Vinita Basu.