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| | Monday, November 24, 2008 | Volume 2, Issue #43 | |  Published weekly, the TopStockAnalysts Digest is loaded with stock picks, trading ideas, market commentary, and educational guidance designed to help you become a better investor. To ensure uninterrupted delivery of this newsletter, please follow these simple instructions.
| | | | Today's Top Stock Picks | |  How You Can Profit From The Retail Sector Bloodbath this Holiday Season
Even Santa may be tightening his belt this year, but that doesn't mean all retailers will suffer. Here are three retail stocks you should be putting under your tree this year.
Read More. . .  Why Warren Buffett Loves this Stock... and I Think it Could Gain +86%
Warren Buffett picked up 66 million shares of ConocoPhillips over the last few months. Fortunately, I share his optimistic view of the stock.
Read More. . . | | | How Paulson and the Treasury Can Hand You 87% Hank Paulson and the U.S. Treasury just gave Wells Fargo a secret $5 billion "gift." While this overnight ruling is helping Wells, it's about to destroy a whole crop of weak companies... and make a few others cash cows. There's a small window to pocket 87% on this play right now. Other gainers to follow. Go here for all the details... | | . | | Market Update | | Heading into this week, technical analysts attempting to read the tea leaves in market charts pointed to 777 as a key support level to watch on the S&P 500.
Yes, that number may conjure up images of a jackpot combination lined up on the reels of a Las Vegas slot machine, but in this case we're talking about the market low of October 2002. The final capitulation from the "Dot.com" meltdown of 2000-2002 reached a crescendo at that exact spot -- before the S&P rocketed past the 925 mark just one month later.
Of course, the uptrend that followed eventually carried the index to uncharted highs above 1500 last year, and few thought we'd be revisiting the 777 area code again. But after a year-long freefall, we've now made the round trip back to re-rest that prior low. Unfortunately, the market failed that test mid-week during the most brutal two-day rout in more than 20 years.
When the dust settled, the S&P closed at just 752 on Thursday, touching levels that were last seen in April 1997. From job cuts at Citigroup (NYSE: C) to a deflationary CPI report to congressional wrangling over a bailout of the beleaguered auto industry, traders had plenty on their plate this past week. On the bright side, Thursday's indiscriminate selling (which came amid heavy volume) raised hopes that many sellers have now thrown in the white towel of surrender -- which is exactly when turnarounds happen.
And it gave way to a powerful rebound on Friday, when stocks soared on news that President-elect Obama will name New York Federal Reserve President Timothy Geithner as the next Treasury Secretary -- a trusted name in an uncertain time. And news of a lifeline to Citigroup looks to keep investors in the buying mood this week.
Nevertheless, it was another in a seemingly endless streak of heavy weekly losses for the major averages. Luckily, there are a number of places for investors to profit -- even among beaten-up sectors like retailers. Smart Profits Report Senior Analyst Marc Lichtenfeld dives into the field and brings readers three names that are proving quite lucrative in today's market. Next, I'll bring you a profile of a stock I like at these levels. But I'm not the only one. Legendary investor Warren Buffett has bought 66 million shares of this oil company over the last few months -- enough to represent 6% of the total shares outstanding. And despite this attention, I calculate the stock still has room to rise nearly +90% before hitting its fair value.
Good Investing! 
-- Nathan Slaughter
Co-Editor
TopStockAnalysts Digest | | | Your Way To Make Money In This Market From economic uncertainties... to the fallout from the financial crisis... to political uncertainty... investors are dealing with several major issues. But despite all the upheaval, we've uncovered something that could be considered the "biggest stock market giveaway."
This is no gimmick. This investment technique works in any type of market situation or political scenario -- but the trying times we've endured lately happen to provide the best situation for it.
For example, just a few days ago, charter members had the opportunity to make $1,050 on just one play in less than a few hours. Others who have used this technique have made even more. Don't miss out on the details that will show you not only how to survive, but also prosper through these times. Click here for more information | | . | | | How You Can Profit From The Retail Sector Bloodbath this Holiday Season
by Marc Lichtenfeld, Senior Analyst -- Smart Profits Report | | | Stating that the retail sector has suffered a bombardment of bad news the last few months is like saying the Atlantic Ocean is wet. And while we may not see bankruptcies springing up everywhere, expect this holiday season to be a bloodbath for retailers.
Let's look at what this year's crucial shopping season has in store -- and of course, the best ways to profit...
A Shift In American Shopping Philosophy
"Shop 'Til You Drop."
No sooner have many Americans digested their Thanksgiving turkey and gotten over the tryptophan-induced grogginess and bloating than they rush out to the mall, with this rallying cry ringing in their ears.
The most important factor in trying to forecast retail sales is income. And because we're not a nation of savers, if Americans are making money, they're usually spending it soon afterwards. The problem right now, though, is this: Because the country has endured a widespread slump, Americans are starting to change the way they think. They're fearful about their incomes.
Average consumers have already cut back on their spending, and will likely tighten their wallets even more as we head deeper into this overarching bear market. And with good reason, too...
The Stats Paint An Ugly Picture
 Fidelity Investments started the process of laying off 1,300 workers.
Chicago Mayor Richard Daley said CEOs who do business in Chicago have warned him that mass layoffs are coming this month and in December -- with more on the way next year.
According to the Bureau of Labor Statistics, over 235,000 people lost their jobs in 2,269 mass layoff events, which are described as layoffs involving at least 50 people in a single action. This was the highest total since 2001.
Job losses on Wall Street alone are expected to total at least 45,000.
On top of that, initial jobless claims are at the highest level in eight years, and we've got an unemployment rate of 6.5% -- a figure not seen since 1994.
Those figures alone spell trouble for the retail sector, but when people suggest those numbers could climb into the double-digits, well... you can imagine the misery that would ensue.
Simply put, people are just plain scared. Retail is enduring a double-whammy. On one hand, it's suffering because people are already getting laid off and don't have the income to buy flat-screen TVs and iPods. And following swiftly behind it is the very significant issue that existing workers, mindful of the ugly trend, are worried the next swing of the axe will hit them.
In other words, it's bad right now and likely to get worse. One of the biggest casualties of the whole affair will doubtlessly be the retail sector, as it gets pounded like a veal scaloppini.
It's likely that top retailers that sell pricier goods will absorb the hardest hits. Take Macy's Inc. (NYSE: M), for example. After the firm's disappointing third-quarter losses, as sales dropped over -7%, the company isn't showing much optimism for the upcoming holidays. Instead, it predicts that the next two months will be a "nailbiter." Reflecting that sentiment further, it slashed its 2009 budget for capital expenditures nearly in half as it tries to cope with the changing economy.
So are there any retailers that could buck the trend and capitalize? Here are three...
Important Note: Because this article is fairly extensive, we could not include it in its entirety in today's newsletter. You can find the remainder of this article on our website. Please visit this link to continue reading this article. | | | The Top Stocks to Own Before Obama Takes Office Whenever Washington decides to help a new industry get off the ground, the investment profits follow in lockstep. We saw it happen in biotechnology, nanotechnology and the Internet. But if you missed out on these government-fueled bonanzas of the 1990s, don't feel bad... an instant replay is straight ahead.
A small group of 20 to 30 stocks is going to be flooded with so much new government cash that our research team believes a few of them could shoot up 100-to-1 in the next three or four years. This group of investments was a good bet even before Obama was elected... now it's a slam dunk. Go Here to Learn How to Profit from These Stocks Now | | . | | | Why Warren Buffett Loves This Stock... and I Think it Could Gain +86%
by Nathan Slaughter, Editor -- Half-Priced Stocks | | | Between March and September, billionaire investor Warren Buffett picked up about 66 million shares (6%) of ConocoPhillips (NYSE: COP, $46.84), one of the world's largest integrated oil companies. What do Buffett and I like about this company?
To start, the firm's exploration and production (E&P) business has operations that span nearly two dozen countries around the globe. Last year, producing wells from Alaska to Libya spit out 854,000,000 barrels of oil and over 5 billion cubic feet (bcf) of natural gas daily.
As for reserves, the company still has a mountain of 10.6 billion barrels of oil equivalent (BOE) waiting underground, and exploratory drilling in Africa, the Middle East, the North Sea and many other regions should add to that total going forward.
Conoco is also the nation's second-largest refiner, with 12 facilities capable of processing and converting oil into gasoline, diesel fuel and other products. From there, the firm's marketing segment operates a chain of 10,500 wholesale and retail outlets (Conoco and Phillips66) throughout the U.S. and Europe.
Outside of this core business, the company also has extensive midstream natural gas gathering and processing assets and a massive petrochemicals division that produces $13 billion in annual revenues just by itself.
Added up, you're looking at a company that has generated $25 billion in operating cash flow over the last 12 months on revenues exceeding $230 billion. Over the past three months alone, Conoco has raked in enough cash to repurchase $2.5 billion worth of stock, dish out $700 million in dividend distributions, and still have over $4 billion left over to upgrade facilities and expand exploration activity.
Of course, the windfall of profits from soaring commodity prices has died down for the time being, with crude backtracking from $147 per barrel to around $50. But don't feel too bad for Conoco -- the firm still banked over $12 billion in profits last year by selling oil at an average price of $67 per barrel (with an average production cost of $7.21 per barrel).
In other words, Conoco will still be immensely profitable even if oil prices continue falling. But it's the firm's strategic partnerships that really help it stand out. Decades ago, global oil companies had a world of opportunities to explore. But now, only a small fraction of the planet's oil reserves are accessible, as most have been locked up by national oil companies (think Venezuela) trying to hoard their own supplies.
But Conoco has proven that it can be a valuable ally, particularly when it comes to extracting the oil/gas from new discoveries. That's why the company has been able to strike lucrative deals with state-owned companies in Brazil, Abu Dhabi, and Saudi Arabia, among other places. The firm also has a valuable 20% equity stake in Russian giant Lukoil, and its investment in that oil-rich country has yielded almost $2 billion in profits so far this year.
However, despite all this, the shares have been cut in half since this past summer and can now be had for just four times earnings -- about half the pricier multiples commanded by rivals like Chevron (NYSE: CVX) and ExxonMobil (NYSE: XOM).
Many companies might be toppled by this harsh economic downturn, but Conoco will not be one of them. Now is an excellent time to buy this world-class energy company (and its valuable untapped reserves and foreign partnerships) for a deeply discounted price.
Thanks to the sharp downturn, these shares offer an attractive risk/reward profile and a respectable yield. I see COP at this level as a blue-chip stock that you can sleep easy owning. I estimate its fair value at about $87, which means I'm optimistic for a potential gain of +86% from current levels. | | | . | | Additional Investing Ideas | |  | The Tales Get Taller
Guest Editor Peter Schiff discusses why the U.S. dollar may be the biggest victim of our current financial predicament. | |  | A Second Chance to Buy This +265% Gainer
Investors often wish they could turn back time and buy Google (GOOG) at its IPO valuation. Well they just got their wish. | | | Buy the Bottom and Rebound on the High Seas
Shipping stocks are at a price point that suggests the world has stopped turning and the seas have evaporated. When investors eventually come to their senses, I want to sail the rebound in this attractively valued shipping ETF. | | Visit this link to read additional articles from today's leading market experts! | | | | . | | Featured Topic -- Emerging Markets Haven't Been this Inexpensive in Years -- And Indonesia Offers a 9.2% Play | The global stock market sell-off has hit emerging markets especially hard as investors move away from those areas they consider the most risky. And while some emerging markets are indeed more vulnerable to the credit crisis and global economic downturn, others will still grow faster than developed economies -- with little chance of a currency collapse, debt default or other catastrophe that would severely wound corporate profits.
One country that could be among the leaders in the next bull market is Indonesia. The world's fourth-most populous country (behind the U.S.), Indonesia is the largest economy in Southeast Asia. After years of high inflation, Indonesia's economy stabilized in 2004 and has grown rapidly since then.
Much of this growth is thanks to valuable natural resources, particularly oil, timber products, gold and other minerals, and rubber. The country's productive agricultural sector generates solid exports to the rest of Asia. And with a large, relatively poor population, Indonesia has much room to grow as a consumer society as its rising middle class increasingly demands more food, better homes and furnishings, electronic appliances and cars.
As government reforms begin to attract more foreign investment, Indonesia has begun the process of building a larger middle class -- the path to greater prosperity taken by South Korea, Taiwan and mainland China.
Indonesia's economy rose +6.3% in 2007, and it kept up that pace in the first half of this year. The global credit crunch, however, has hit the country hard, and investors have fled. But they're now returning for good reason: Even as the economy slows, it's still expected to grow -- while the U.S. and Europe contract, Indonesia's GDP is expected to rise +6.1% for all of 2008 and +3.7% for 2009. And despite this growth, Indonesia's market trades at a rock-bottom P/E of only 6.7.
Important Note: Because this article is fairly extensive, we could not include it in its entirety in today's newsletter. You can find the remainder of this article on our website. Please visit this link to continue reading this article. | | | . | | Free Investing Resources | Learn How to Capture 20  | Free One-on-One Training with Award-Winning Forex Software. Receive this free guide, containing everything a beginner currency trader needs to know before entering the fast-paced forex market -- from how to choose a dealer to placing an order. GFT is a worldwide leader in online currency trading. Take advantage of this offer. | |  | Get 10 Free Issues of Investor's Business Daily and 2 weeks of Investors.com -- During your trial, you'll get alerts to top-rated stocks near a buy point. And you can diagnose your stocks with unbiased ratings in IBD Stock Checkup.
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