wearmanyhats

Despite the warnings of well-meaning and cautious financial advisers, long term investors need to always keep finding good deals to add to their portfolios. This week we’ll look at a few lower priced stocks that diversity a portfolio and give a chance to build a good portfolio over time.

1.  Aqua America (WTR)  Water is referred to as “blue gold” by financial gurus.  It is thought that water problems in the future will make this commodity expensive and valuable.  Those companies who have the water rights of various water tables and reservoirs The slow, upward profitability of this stock and the fact that insiders grabbed into it when it had corrected downward a bit.  Aqua America (WTR) is one such company.

Right now WTR is close to being too expensive because the P/E is over 20. However, on the technical charts, it is trading almost at a low.  A good buy would be under 16.  Sell if it were to trade over 21.

2.DCP Midstream Partners LP (DPM):  It’s rare that a stock can triple in six months and still be an excellent value.  This is one such instance.  DPM is a pipeline company that provides a 13% dividend and  and a ridiculously low P/E of 4.  This company’s energy assets are involved with pipelines and propane.  As natural resources continue to propel upward, this company should do quite well.

3.  Caterpillar, Inc. (CAT)- It may seem counter intuitive  to purchase a company that depends on sales in big equipment in a world that is struggling financially. In fact, when this list was being put together, real estate, banks and other stocks which could be hurt significantly by the market was excluded.  However, CAT is different because it has worldwide recognition for its large equipment.  Plus it is in the perfect position to blitz upward whenever a recovery in this sector takes off.  It is still fairly close to the fifty-two week low.   CAT fell from 83 all the way down to 29. Slowly it is creeping back. This may be the riskiest stock on the list, but with a P/E under 9, and insiders buying confidently, this stock is probably a fine long term keeper.   So many emerging markets need heavy equipment and CAT has an aggressive world wide presence.

4.Targa Resources, LP (NGLS):  This pipeline maker has the one thing going for it that make stock pickers excited:  insider buying.  Insiders like this like crazy.  The last dividend was over 17% and although it is trading at twice its 52 week low of five, it still is $10 under its high of 26.  The P/E is under 9 and the future is bright as the price of oil creeps up.  If you have to lose money at the pumps, you might as well put some in your pocket through your investments.

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