CNBC’s Million Dollar Portfolio Challenge: Initial Picks

I just made my first trades on CNBC’s Million Dollar Portfolio Challenge. Unfortunately, I didn’t have time yesterday to make them. This means I might have missed yesterday’s price movements. Though, according to a comment from B. Hopper, this may not matter, because the prices aren’t yesterday’s prices. Oh well.

My stock selection strategy here is not what I use for my own real-world portfolio. Since this contest is only measuring the total portfolio value up until May 25th, only short-term growth stocks matter here. So my entire selection is based on quick and (hopefully) big wins. They are mostly in the technology sector, where I have the most domain knowledge.

My initial picks:

• Cognizant Technology Solutions (CTSH)

  CTSH is an IT consulting firm located in India and competes against IBM, Accenture, etc. They reported strong Q4 2006 earnings, just opened their 8th location in India, and are making successful investments in employee retention & recruitment (which is a key business driver for consulting firms).

• Advanced Energy Industries (AEIS)

  AEIS develops power conversion & control systems used in plasma-based thin-film processing equipment, such as semiconductors, flat panel displays, and solar cells. Solar cells alone grew over 200% YoY in 2006. They have strong sales, high margins, and high insider ownership, all very positive traits.

• Akamai Technologies (AKAM)

  AKAM provides Internet content delivery services, notably speeding up the download time of websites. They’ve been acquiring competitors and grew their customer base faster than expected. They now have the capability to serve applications and video (against YouTube’s provider Limelight).

• ValueClick (VCLK)

  VCLK is an online marketing services company. One of their offerings is Commission Junction, their affiliate & search marketing division, which offers services similar to Google’s AdSense & AdWords.

• Nam Tai Electronics (NTE)

  NTE is a China-based electronics manufacturing & design services provider for OEMs of telecommunications & consumer electronics. They have a low P/E, a high market cap, and is highly rated by many investors, despite being a little-known company.

• Cabot Oil & Gas Corporation (COG)

  COG is a natural gas producer with operations in the US and Canada. On March 30th, they’re doing a 2-for-1 split and raising their dividend payments. That alone is worth a buy, even though consumers don’t use as much natural gas during the summer.

• Yahoo! (YHOO)

  YHOO is an Internet search and media company. I’m an employee at Yahoo, so hey, I gotta support my peeps!

Author: Mike Lee

An idealistic realist, humanistic technologist & constant student. View all posts by Mike Lee