Stick With Proven Winners

Have you checked Goldcorp (NYSE/GG) lately? This stock is on a tear. It was just trading around $20 per share in December. Now it just broke through $28 per share. It just goes to show you that gold remains hot in this market.

A company I really like as a long-term opportunity, Luxottica (NYSE/LUX), is finally appreciating on the stock market after trading range bound around $25 per share. This large-cap European company just signed a 10-year eyewear licensing deal with Polo Ralph Lauren, which could be worth more than $1.75 billion in sales to the company.

You might think that the eye care business is boring, but there are big bucks to be made from this industry.

The alternative energy sector of the market remains an out- performer. Evergreen Solar (NASDAQ/ESLR) and SunPower Corp. (NASDAQ/SPWR) are looking great in this market.


Even the small Fuel-Tech N.V. (NASDAQ/FTEK) which I’ve mentioned several times in this column is doing great selling pollution control equipment around the world.

Finally, there’s Caterpillar (NYSE/CAT), which continues to break through to new highs on the stock market, riding a strong wave of demand for construction and mining equipment. This large-cap Dow stock just hit a brand new all-time high.

I guess the big point to be made here is that I still feel very good about the prospects for stocks this year. Small- and large-cap stocks alike, there are great opportunities for investors to be had in this market right now.

There is no one formula that works for picking great stocks on an ongoing basis. As an investor, you have to change your investing style commensurate with market psychology. Right now, investing in companies that are already winners, both operationally and on the stock market, seems like a useful strategy.

This shouldn’t be considered momentum investing, just going with those stocks that are already successful. Picking turnaround opportunities is a very tough thing to do. Right now, there’s no better strategy that sticking with the winners.