9 Hot Stocks Poised to Double, Triple ... Even Quadruple
By Andrea Tse
NEW YORK (TheStreet) -- While "growth stocks" are more commonly equated to "small-cap stocks" in many investors' minds, there are large-cap stocks that are poised to pop too. Here we present stock picks -- both small and large -- of top portfolio managers, all primed to double or even triple...
1) USEC(USU)
Number of Analysts: 3 Average Recommendation: Hold
Stock Price/Earnings Ratio vs. Industry's: 116.68%
Market Cap: $597.2 million
Trailing Twelve-Month Operating Margin: 4.3%
Trailing Twelve-Month Revenue: $1.82 billion
What's to Like About USEC Stock: "USEC operates the sole commercial uranium enrichment facility in the U.S., so as new reactors in China reach the fueling stage, which several are, it pushes on the available supply, driving up prices globally," Huntington Asset Advisors manager Peter Sorrentino said. "The company is currently processing the material from decommissioned U.S. and Russian warheads."
Sorrentino said that this uranium company is a stock that really could go either way -- it's got a high beta. However, it's small enough that if investors get excited about nuclear energy they tend to "run this stock up with a vengeance." The same applies to uranium company Uranium Energy Corp.(UEC) (see next page), which is also in that category.
Sorrentino said if conditions were favorable, they could at least double within a year.
2) Uranium Energy Corp.
Number of Analysts: 6
Average Recommendation: OUTPERFORM
Market Cap: $200.9 million
What's to Like About Uranium Energy Corp. Stock: "Uranium Energy Corp. is set to start production from its properties beginning the end of this year. Should the results come in better than forecast the stock could benefit from momentum investors looking for upside surprises," Huntington Asset Advisors manager Peter Sorrentino said.
3) DryShips(DRYS_)
Number of Analysts: 17
Average Recommendation: Hold
Stock Price/Earnings Ratio vs. Industry's: 114.7%
Market Cap: $1.6 billion
Trailing Twelve-Month Operating Margin: 36.4%
Trailing Twelve-Month Revenue: $819.8 million
What's to Like About DryShips Stock: "DryShips specializes in the supply and movement of deepwater drilling equipment. With the moratorium in the Gulf of Mexico there are a number of rigs being moved currently to the west coast of Africa and towards the east coast of Brazil. This activity is not currently reflected in estimates for the company and should result in earnings surprises for the next couple of quarters," Huntington's Sorrentino noted.
"In addition, the demand for dry bulk shipping of grains and minerals will be stronger than initially forecast due to both weather and industrial production issues." Sorrentino said DryShips is in a position where, if the Baltic Dry shipping rates tick up on better economic data, it will take off.
4) SunPower(SPWRA)
Number of Analysts: 39
Average Recommendation: Hold
Market Cap: $1.3 billion
Trailing Twelve-Month Operating Margin: 4.8%
Trailing Twelve-Month Revenue: $2.48 billion
What's to Like About SunPower Stock: "SunPower is selling a little over one times its revenue -- very cheap for any major energy infrastructure manufacturer looking to gain a beachhead in this most active of green power arenas," Huntington's Sorrentino said. "[Likewise], SunPower is trading at one times sales and only seven times next year's estimated earnings, so it's not too big to be a consolidation candidate or a cheap way for someone else to get into the solar space."
5) FARO Technologies(FARO)
Number of Analysts: 6
Average Recommendation: Outperform
Stock Price/Earnings Ratio vs. Industry's: 618.04%
Market Cap: $351 million
Trailing Twelve-Month Operating Margin: 4.8%
Trailing Twelve-Month Revenue: $169.7 million
What's to Like About FARO Technologies Stock: "This company has no debt and about $100 million of cash, so they have about $7 a share in cash," Eric Marshall of the Hodges Fund said. "They make capital equipment for precision measurement that uses 3D imaging technology to go out and do computer animated measurements that can then be compared against drawings and so forth in the engineering process. It's used by manufacturers; it's used by the military. Big customers are Boeing(BA), the auto companies and so forth."
"There are about four different types of measurement products that they use -- they're all kind of digital measurement products that tend to be early cyclical. They tend to do really well in the early stages of the business cycle."
"The company stock price has been kind of depressed -- forgotten about. But this is a company that has the potential in an earnings recovery to really see earnings get back to the levels of a few years ago. They're only expected to do 65 cents this year, and $1.20 for next year. And then the following year, beyond that -- I think this is a company that could potentially do $3 or $4 a share; has the ability to grow at a 20+% growth rate due to the fact that there are really new markets being opened up for the type of measurement applications that their products are used for."
6) Tuesday Morning(TUES)
Stock Price/Earnings Ratio vs. Industry's: 118.01%
Market Cap: $204.8 million
Trailing Twelve-Month Operating Margin: 2.4%
Trailing Twelve-Month Revenue: $828.3 million
What's to Like About Tuesday Morning Stock: "This is a small cap company people have kind of forgotten about. They have home furnishings and those types of products and they have a model that's similar to T.J. Maxx," Eric Marshall of the Hodges Fund said. "The stock's about $4.60. They have a tangible book value of about $6 a share.
"We think the actual liquidation value of the company's assets and real estate is actually even higher than that. We think the intrinsic value -- just the assets -- are probably closer to $7 a share. The company's earnings are expected to recover to around 40 cents this year. They have no debt and 50 cents worth of cash. The company potentially, somewhere down the road, could get back to doing $1.50 a share of earnings. If they're able to ever do that, this is a stock that could be a three-bagger four, five years down the road."
"You don't necessarily need to have a very robust consumer-led economy for them to do well. But I think just stabilization in their business ... they're a combination between a T.J. Maxx and a Stein Mart( SMRT )-type business. This was a really hot stock years and years ago. Wall Street's kind of abandoned it and it's kind of a contrarian play from here."
"We think the stock is worth twice of what it is if you just went out and liquidated the inventory, liquidated the real estate, took cash off the balance sheet, paid off all the creditors -- you'd probably have $7 or $8 a share of value here in this company, which as long as you're debt-free, you're sitting on 50 cents of cash and you're making 40 cents from the $4 level. Your downside risk is relatively mute unless something very catastrophic was to happen to retail and the economy in the macro position. But the company has done a good job of repositioning its business here through the downturn and we think once Wall Street takes notice, it can be a quick double -- eventually could potentially be a triple or a quadruple if they ever get back to that $1.50 of earnings power that we think exists in the core business."
"The potential for a tripling of the stock would be that over the next three to five years the company regains its historical earnings power of $1.50. If that happens and it trades at ten times earnings, you'd have a $15 stock -- and its trading at about $4.60 right now. So that's what would have to happen. But I think with just better exposure in the Wall Street community, the stock could go back to $7 or $8 really easily just based on the underlying intrinsic value of the assets of the underlying business -- just by looking at the balance sheet."
7) PCMall(MALL)
Number of Analysts: 2
Average Recommendation: Buy
Stock Price/Earnings Ratio vs. Industry's: 43.63%
Market Cap: $57.56 million
Trailing Twelve-Month Operating Margin: 0.6%
Trailing Twelve-Month Revenue: $1.22 billion
What's to Like About PC Mall Stock: Bob Auer of the Auer Growth Fund recently bought shares of PC Mall after the company reported one of its best quarters ever. "We don't buy anything that doesn't have an up 25% or more profit," Auer said. During the second quarter, the company reported earnings growth of 67% from the previous year and sales growth of roughly 21% compared to last year; the stock made the cut to Auer's fund.
With about 2,400 employees, PC Mall, which has been around for 20 years and sells computers on line, is described by Auer as a "nice-sized" and "neat" company that provides "a pretty risk-free shopping experience. Auer noted that PC Mall stock was trading at about 57% of book value and $4.58 when he spoke to TheStreet on Sept. 17. "It's year high was over $8 ... last year. They just had their best quarter and the stock's only $4.58. So for it to double, it would only have to go back to where it was -- even when they weren't doing as well," he pointed out. "If it just got back to book value, it would almost double."
In his second-quarter earnings statement, PC Mall's CEO Frank Khulusi said he believes the company's growth was driven by both "an improving demand environment and by the investments that we have been making in our businesses, which are beginning to pay off."
The stock in the last 52 weeks was down 35%.
Auer said that the stock is currently one out his fund's hundred's of stocks and one of his smallest positions. "It's new to us and we kind of nibbled on it, but we might add more to it later."
Currently, the low-end of the earnings analyst consensus estimate for PC Mall has been 60 cents for 2010 and 85 cents for 2011. "If they make 85 cents next year and it only trades at a 10 P/E (10x P/E ratio), it'd be an $8.50 stock. And if people get excited about their growth because it's going to go from 35 cents last year to 60 cents estimated this year and 85 cents estimated next year ... when you ... have growth like that ... maybe it would trade at 15 times multiple (15x P/E ratio) -- and then all of a sudden it might be a $12 stock," Auer said..
"Then you almost have your triple."
Auer said that this year PC Mall's sales will likely be well over $1 billion.
8) Baidu(BIDU)
Number of Analysts: 25
Average Recommendation: Outperform
Stock Price/Earnings Ratio vs. Industry's: 451.59%
Market Cap: $29.835 billion
Trailing Twelve-Month Operating Margin: 43.3%
Trailing Twelve-Month Revenue: $851.67 million
What's to Like About Baidu Stock: As a large-cap growth manager, Michael Sansoterra of Ridgeworth Large Cap Growth Fund doesn't have a whole lot of stocks that can double in a short-term time horizon. But one of more aggressive names he carries and that he thinks could roughly double in about a two-year time period -- even from its current lofty levels -- is Chinese Internet engine giant Baidu.
"We've already owned the stock for some time and we've already watched it double, but we think it can continue to do well."
"Its traffic has probably gone up close to 4x in the last 18 months," Sansoterra said. The stock could easily be a $150 stock he added, depending on the consistent growth rate of China and the company's continued ability to growth north of 50%. Currently, it is estimated that there are more than 400 million daily Internet searches occurring in China right now and that the searches are estimated to be growing at more than 10% quarter over quarter.
Sansoterra said the company currently has a leading Internet search engine position in China, with second-quarter market share position of about 34% and first-quarter market share position of about 29%. "They've got some of the best technology. They've got the first move advantage and they've done a better job of monetizing their customers [compared to the competition] with their Phoenix Nest platform." Sansoterra said Baidu has benefited significantly from the platform as it allows the company's customers to understand their return on investment for spending with Baidu. With this platform, advertisers have access to very clear and easy-to-see data.
The investment manager said that Baidu is also finding new ways to monetize its customers through the mobile space. "With Google's(GOOG) pain, I think they can approach 50% market share over the few years," though necessarily owning the market given the stiff competition.
"I would also mention that their operating leverage is kicking in more so than ever before," he added. "That's a big opportunity. At Ridgeworth, we're believers that companies with the ability to beat expectations, even when they're lofty, are stocks that outperform."
9) Google
Number of Analysts: 35
Average Recommendation: Outperform
Stock Price/Earnings Ratio vs. Industry's: 106.61%
Market Cap: $122.41 billion
Trailing Twelve-Month Operating Margin: 35.9%
Trailing Twelve-Month Revenue: $26.21 billion
What's to Like About Google Stock: Google stock can double over three to five years, according to Channing Smith of Capital Advisors Growth Fund. "I think Google is undervalued and the growth opportunities are underappreciated there," he explained.
There are numerous reasons Smith believes Google stock will continue to appreciate -- as long, of course, as its markets continue to grow and the economy continues to improve. Among these reasons are Google's Internet market share dominance at about 70% and continued innovation -- the company's new search enhancement feature Google Instant is just one example of this -- and its strong commitment to mobile Internet, he said. "At Capital Advisors, we believe that mobile Internet is going to be the largest technology cycle ever seen," Smith said. "We think it will be at least ten times bigger than the desktop Internet cycle."
Smith added that Google has quickly responded to Apple's(AAPL_) smart devices with the Android operating system, and that Google-based smart phone sales recently exceeded Apple's for the first time. Also, the company is on "the cusp" of monetizing its investment in both display and video advertising through YouTube and Google TV. "I think you can make a very good case that earnings growth for Google is set to accelerate much more than the market anticipates."
Smith said Internet advertising is a secular trend -- growing at a double-digit rate -- and that smart phones are flush with potential at only roughly 20% market penetration right now.
Smith said Google's growth opportunity can be bought at a very attractive 15x P/E ratio or 12x P/E ratio when adjusted for cash. The financial position of the company is impressive, Smith said. With no debt and plenty of cash, the stock should "give investors comfort even if we see the economy decelerate to some degree."
The investment advisor said Google is already closing in on a formidable chunk of the U.S. Internet mobile market share -- an "exploding" segment of the market where there's a two-horse race taking place between Google and Apple -- as Research In Motion(RIMM) continues to fade from lagging technology. Furthermore, "if you're Samsung, Nokia(NOK) or Motorola(MOT), you know you can't compete with [closed-end] Apple on your own. So what you do is partner with Google" and implement its Android system."
He added that Google's tens of thousands of apps are rapidly catching up with Apple's hundreds of thousands of apps.
-- Written by Andrea Tse in New York.
Stock Price/Earnings Ratio vs. Industry's: 116.68%
Market Cap: $597.2 million
Trailing Twelve-Month Operating Margin: 4.3%
Trailing Twelve-Month Revenue: $1.82 billion
What's to Like About USEC Stock: "USEC operates the sole commercial uranium enrichment facility in the U.S., so as new reactors in China reach the fueling stage, which several are, it pushes on the available supply, driving up prices globally," Huntington Asset Advisors manager Peter Sorrentino said. "The company is currently processing the material from decommissioned U.S. and Russian warheads."
Sorrentino said that this uranium company is a stock that really could go either way -- it's got a high beta. However, it's small enough that if investors get excited about nuclear energy they tend to "run this stock up with a vengeance." The same applies to uranium company Uranium Energy Corp.(UEC) (see next page), which is also in that category.
Sorrentino said if conditions were favorable, they could at least double within a year.
2) Uranium Energy Corp.
Number of Analysts: 6
Average Recommendation: OUTPERFORM
Market Cap: $200.9 million
What's to Like About Uranium Energy Corp. Stock: "Uranium Energy Corp. is set to start production from its properties beginning the end of this year. Should the results come in better than forecast the stock could benefit from momentum investors looking for upside surprises," Huntington Asset Advisors manager Peter Sorrentino said.
3) DryShips(DRYS_)
Number of Analysts: 17
Average Recommendation: Hold
Stock Price/Earnings Ratio vs. Industry's: 114.7%
Market Cap: $1.6 billion
Trailing Twelve-Month Operating Margin: 36.4%
Trailing Twelve-Month Revenue: $819.8 million
What's to Like About DryShips Stock: "DryShips specializes in the supply and movement of deepwater drilling equipment. With the moratorium in the Gulf of Mexico there are a number of rigs being moved currently to the west coast of Africa and towards the east coast of Brazil. This activity is not currently reflected in estimates for the company and should result in earnings surprises for the next couple of quarters," Huntington's Sorrentino noted.
"In addition, the demand for dry bulk shipping of grains and minerals will be stronger than initially forecast due to both weather and industrial production issues." Sorrentino said DryShips is in a position where, if the Baltic Dry shipping rates tick up on better economic data, it will take off.
4) SunPower(SPWRA)
Number of Analysts: 39
Average Recommendation: Hold
Market Cap: $1.3 billion
Trailing Twelve-Month Operating Margin: 4.8%
Trailing Twelve-Month Revenue: $2.48 billion
What's to Like About SunPower Stock: "SunPower is selling a little over one times its revenue -- very cheap for any major energy infrastructure manufacturer looking to gain a beachhead in this most active of green power arenas," Huntington's Sorrentino said. "[Likewise], SunPower is trading at one times sales and only seven times next year's estimated earnings, so it's not too big to be a consolidation candidate or a cheap way for someone else to get into the solar space."
5) FARO Technologies(FARO)
Number of Analysts: 6
Average Recommendation: Outperform
Stock Price/Earnings Ratio vs. Industry's: 618.04%
Market Cap: $351 million
Trailing Twelve-Month Operating Margin: 4.8%
Trailing Twelve-Month Revenue: $169.7 million
What's to Like About FARO Technologies Stock: "This company has no debt and about $100 million of cash, so they have about $7 a share in cash," Eric Marshall of the Hodges Fund said. "They make capital equipment for precision measurement that uses 3D imaging technology to go out and do computer animated measurements that can then be compared against drawings and so forth in the engineering process. It's used by manufacturers; it's used by the military. Big customers are Boeing(BA), the auto companies and so forth."
"There are about four different types of measurement products that they use -- they're all kind of digital measurement products that tend to be early cyclical. They tend to do really well in the early stages of the business cycle."
"The company stock price has been kind of depressed -- forgotten about. But this is a company that has the potential in an earnings recovery to really see earnings get back to the levels of a few years ago. They're only expected to do 65 cents this year, and $1.20 for next year. And then the following year, beyond that -- I think this is a company that could potentially do $3 or $4 a share; has the ability to grow at a 20+% growth rate due to the fact that there are really new markets being opened up for the type of measurement applications that their products are used for."
6) Tuesday Morning(TUES)
Stock Price/Earnings Ratio vs. Industry's: 118.01%
Market Cap: $204.8 million
Trailing Twelve-Month Operating Margin: 2.4%
Trailing Twelve-Month Revenue: $828.3 million
What's to Like About Tuesday Morning Stock: "This is a small cap company people have kind of forgotten about. They have home furnishings and those types of products and they have a model that's similar to T.J. Maxx," Eric Marshall of the Hodges Fund said. "The stock's about $4.60. They have a tangible book value of about $6 a share.
"We think the actual liquidation value of the company's assets and real estate is actually even higher than that. We think the intrinsic value -- just the assets -- are probably closer to $7 a share. The company's earnings are expected to recover to around 40 cents this year. They have no debt and 50 cents worth of cash. The company potentially, somewhere down the road, could get back to doing $1.50 a share of earnings. If they're able to ever do that, this is a stock that could be a three-bagger four, five years down the road."
"You don't necessarily need to have a very robust consumer-led economy for them to do well. But I think just stabilization in their business ... they're a combination between a T.J. Maxx and a Stein Mart( SMRT )-type business. This was a really hot stock years and years ago. Wall Street's kind of abandoned it and it's kind of a contrarian play from here."
"We think the stock is worth twice of what it is if you just went out and liquidated the inventory, liquidated the real estate, took cash off the balance sheet, paid off all the creditors -- you'd probably have $7 or $8 a share of value here in this company, which as long as you're debt-free, you're sitting on 50 cents of cash and you're making 40 cents from the $4 level. Your downside risk is relatively mute unless something very catastrophic was to happen to retail and the economy in the macro position. But the company has done a good job of repositioning its business here through the downturn and we think once Wall Street takes notice, it can be a quick double -- eventually could potentially be a triple or a quadruple if they ever get back to that $1.50 of earnings power that we think exists in the core business."
"The potential for a tripling of the stock would be that over the next three to five years the company regains its historical earnings power of $1.50. If that happens and it trades at ten times earnings, you'd have a $15 stock -- and its trading at about $4.60 right now. So that's what would have to happen. But I think with just better exposure in the Wall Street community, the stock could go back to $7 or $8 really easily just based on the underlying intrinsic value of the assets of the underlying business -- just by looking at the balance sheet."
7) PCMall(MALL)
Number of Analysts: 2
Average Recommendation: Buy
Stock Price/Earnings Ratio vs. Industry's: 43.63%
Market Cap: $57.56 million
Trailing Twelve-Month Operating Margin: 0.6%
Trailing Twelve-Month Revenue: $1.22 billion
What's to Like About PC Mall Stock: Bob Auer of the Auer Growth Fund recently bought shares of PC Mall after the company reported one of its best quarters ever. "We don't buy anything that doesn't have an up 25% or more profit," Auer said. During the second quarter, the company reported earnings growth of 67% from the previous year and sales growth of roughly 21% compared to last year; the stock made the cut to Auer's fund.
With about 2,400 employees, PC Mall, which has been around for 20 years and sells computers on line, is described by Auer as a "nice-sized" and "neat" company that provides "a pretty risk-free shopping experience. Auer noted that PC Mall stock was trading at about 57% of book value and $4.58 when he spoke to TheStreet on Sept. 17. "It's year high was over $8 ... last year. They just had their best quarter and the stock's only $4.58. So for it to double, it would only have to go back to where it was -- even when they weren't doing as well," he pointed out. "If it just got back to book value, it would almost double."
In his second-quarter earnings statement, PC Mall's CEO Frank Khulusi said he believes the company's growth was driven by both "an improving demand environment and by the investments that we have been making in our businesses, which are beginning to pay off."
The stock in the last 52 weeks was down 35%.
Auer said that the stock is currently one out his fund's hundred's of stocks and one of his smallest positions. "It's new to us and we kind of nibbled on it, but we might add more to it later."
Currently, the low-end of the earnings analyst consensus estimate for PC Mall has been 60 cents for 2010 and 85 cents for 2011. "If they make 85 cents next year and it only trades at a 10 P/E (10x P/E ratio), it'd be an $8.50 stock. And if people get excited about their growth because it's going to go from 35 cents last year to 60 cents estimated this year and 85 cents estimated next year ... when you ... have growth like that ... maybe it would trade at 15 times multiple (15x P/E ratio) -- and then all of a sudden it might be a $12 stock," Auer said..
"Then you almost have your triple."
Auer said that this year PC Mall's sales will likely be well over $1 billion.
8) Baidu(BIDU)
Number of Analysts: 25
Average Recommendation: Outperform
Stock Price/Earnings Ratio vs. Industry's: 451.59%
Market Cap: $29.835 billion
Trailing Twelve-Month Operating Margin: 43.3%
Trailing Twelve-Month Revenue: $851.67 million
What's to Like About Baidu Stock: As a large-cap growth manager, Michael Sansoterra of Ridgeworth Large Cap Growth Fund doesn't have a whole lot of stocks that can double in a short-term time horizon. But one of more aggressive names he carries and that he thinks could roughly double in about a two-year time period -- even from its current lofty levels -- is Chinese Internet engine giant Baidu.
"We've already owned the stock for some time and we've already watched it double, but we think it can continue to do well."
"Its traffic has probably gone up close to 4x in the last 18 months," Sansoterra said. The stock could easily be a $150 stock he added, depending on the consistent growth rate of China and the company's continued ability to growth north of 50%. Currently, it is estimated that there are more than 400 million daily Internet searches occurring in China right now and that the searches are estimated to be growing at more than 10% quarter over quarter.
Sansoterra said the company currently has a leading Internet search engine position in China, with second-quarter market share position of about 34% and first-quarter market share position of about 29%. "They've got some of the best technology. They've got the first move advantage and they've done a better job of monetizing their customers [compared to the competition] with their Phoenix Nest platform." Sansoterra said Baidu has benefited significantly from the platform as it allows the company's customers to understand their return on investment for spending with Baidu. With this platform, advertisers have access to very clear and easy-to-see data.
The investment manager said that Baidu is also finding new ways to monetize its customers through the mobile space. "With Google's(GOOG) pain, I think they can approach 50% market share over the few years," though necessarily owning the market given the stiff competition.
"I would also mention that their operating leverage is kicking in more so than ever before," he added. "That's a big opportunity. At Ridgeworth, we're believers that companies with the ability to beat expectations, even when they're lofty, are stocks that outperform."
9) Google
Number of Analysts: 35
Average Recommendation: Outperform
Stock Price/Earnings Ratio vs. Industry's: 106.61%
Market Cap: $122.41 billion
Trailing Twelve-Month Operating Margin: 35.9%
Trailing Twelve-Month Revenue: $26.21 billion
What's to Like About Google Stock: Google stock can double over three to five years, according to Channing Smith of Capital Advisors Growth Fund. "I think Google is undervalued and the growth opportunities are underappreciated there," he explained.
There are numerous reasons Smith believes Google stock will continue to appreciate -- as long, of course, as its markets continue to grow and the economy continues to improve. Among these reasons are Google's Internet market share dominance at about 70% and continued innovation -- the company's new search enhancement feature Google Instant is just one example of this -- and its strong commitment to mobile Internet, he said. "At Capital Advisors, we believe that mobile Internet is going to be the largest technology cycle ever seen," Smith said. "We think it will be at least ten times bigger than the desktop Internet cycle."
Smith added that Google has quickly responded to Apple's(AAPL_) smart devices with the Android operating system, and that Google-based smart phone sales recently exceeded Apple's for the first time. Also, the company is on "the cusp" of monetizing its investment in both display and video advertising through YouTube and Google TV. "I think you can make a very good case that earnings growth for Google is set to accelerate much more than the market anticipates."
Smith said Internet advertising is a secular trend -- growing at a double-digit rate -- and that smart phones are flush with potential at only roughly 20% market penetration right now.
Smith said Google's growth opportunity can be bought at a very attractive 15x P/E ratio or 12x P/E ratio when adjusted for cash. The financial position of the company is impressive, Smith said. With no debt and plenty of cash, the stock should "give investors comfort even if we see the economy decelerate to some degree."
The investment advisor said Google is already closing in on a formidable chunk of the U.S. Internet mobile market share -- an "exploding" segment of the market where there's a two-horse race taking place between Google and Apple -- as Research In Motion(RIMM) continues to fade from lagging technology. Furthermore, "if you're Samsung, Nokia(NOK) or Motorola(MOT), you know you can't compete with [closed-end] Apple on your own. So what you do is partner with Google" and implement its Android system."
He added that Google's tens of thousands of apps are rapidly catching up with Apple's hundreds of thousands of apps.
-- Written by Andrea Tse in New York.
