On Friday the Editorial Advisory and Securities Review Committee of BetterInvesting Magazine met and selected Qualcomm Incorporated (NDQ: QCOM) as its May 2012 “Stock to Study” and General Electric Company (NYSE: GE) as its May 2012 “Undervalued Stock.”
The conversation around Qualcomm centered on its strong market position in smartphones. Apple’s new iPhone uses a wireless chipset from Qualcomm, for example. Smartphone adoption continues to ramp up, with emerging markets leapfrogging older telephone technology (such as landlines) as they build communications infrastructure. The Stock to Study’s goal is a 100% total return (capital appreciation and dividends) within five years.
For the Undervalued Stock, the committee discussed how the growth in demand for General Electric’s energy-related products and services has benefited the company and how GE Capital financial health has improved since the financial crisis began. The stock’s yield, currently at 3.6 percent, is also attractive.
The goal for a Stock to Study is a 100 percent total return (capital appreciation plus dividends) within five years. The Undervalued Stock’s goal is a 20 percent return within 18 months. No investment recommendations are intended. We’ll have more on these stocks in the May 2012 issue.
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