Top Stock Picks for 2019, from the Best Minds on Wall Street

At the end of every year, I ask my contributors to my Wall Street’s Best Investments and Wall Street’s Best Dividend Stocks to submit their favorite stock for the following year. We just wrapped up our Top Stock Picks for 2019 issues, and calculated the 2018 Top Picks’ returns.

And it’s no surprise to me that our contributors—the best minds on Wall Street—handily beat the returns of the broad markets last year!

As you know, 2018 was a challenging year for the markets, reflected in significant daily changes. And the final results were ugly at best. The Dow Jones Industrial Average fell 7.36%, the Nasdaq was down 5.7%, and the S&P 500 lost 7.6%.

Our contributors struggled too, but, as usual, they scored some big gains by choosing healthy growth and dividend-paying stocks last year. They earned some tremendous returns, in the face of many global and domestic challenges.

Our Top Stock Picks of 2018

In Wall Street’s Best Investments, our Top Three Picks had great returns, beating the markets, significantly. Our Cabot analysts proved, once again, that they are the cream of the crop, taking three out of the top four spots.

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Mike Cintolo, Chief Analyst of Cabot Growth Investor, took the gold with his Top Pick of Five Below (FIVE), which gained a stunning 53.27% last year. In second place was Doug Gerlach, editor of SmallCap Informer, whose choice of Emergent BioSolutions (EBS) proved acutely perceptive, raking in a return of 21.40%. Both Timothy Lutts, Chief Analyst of Cabot Stock of the Week, and Paul Goodwin, former Chief Analyst of Cabot Global Stocks Explorer, chose GDS Holdings (GDS), for a very nice return of 14.31%.

Our dividend stock contributors also achieved great success in their 2018 Top Stock Picks.

In my Wall Street’s Best Dividend Stocks newsletter, first place was won by William Velmer of S.A. Advisory, who chose Optex Systems Holdings (OPXS) for a 27.38% gain. Next, Ingrid R. Hendershot of Hendershot Investments recommended The TJX Companies (TJX), which returned 21.93%, and Chloe Lutts Jensen, former Chief Investment Analyst for our own Cabot Dividend Investor, picked UnitedHealth Group (UNH), producing a 12.39% return.

2 Top Stock Picks for 2019

For 2019, contributors to both advisories produced some excellent recommendations as their favorites for the new year. Here are just a couple to consider, proffered by our winning contributors from last year.

Twilio Inc. (TWLO), contributed by Mike Cintolo, who wrote the following: “If a company big or small wants to automate and simplify communications to customers, clients or coworkers, Twilio and its well-rounded, customizable and relatively easy-to-use communications platform is fast becoming the go-to choice. Coca-Cola Enterprises uses Twilio to rapidly dispatch service technicians; Airbnb uses it to automatically text rental hosts information of potential guests, including dates and the price of a stay; the Red Cross of Chicago automatically sends texts to volunteers in an area with pertinent info about a disaster; Trulia uses Twilio to power its click-to-call app so potential buyers can hook up with an agent right quick; EMC uses the platform to quickly send texts to employees when an IT service goes down; and Twilio’s newer Flex offering (cloud-based, flexible call center application) has already signed up some big customers such as Lyft, and its new Pay app allows developers to process payments over the phone without reading a card number to a rep.

“Just about any business can use Twilio’s communications platform for text, voice, video, chats and messaging apps. And thanks to the company’s proposed acquisition of Sendgrid (likely to be completed in early 2019), the platform will now include the email capabilities, and the firm’s recently launched Flex product offers clients a cloud-based customizable contact center functions.

“The firm exited September with 61,153 active customers (up 32% from a year ago), but it’s getting more big clients (it inked Fortune 500 financial services and medical testing outfits in Q3), helping revenue per customer rise 27%. All told, revenue growth is accelerating in a big way, and earnings have leapt into the black.

“Fundamentally, we see Twilio as something of an emerging blue chip—a name that institutional investors will build positions in for many quarters to come.”

TreeCon Resources, Inc. (TCOR), submitted by William Velmer, wrote: “TreeCon Resources, Inc. (TCOR) is a holding company that, through its subsidiaries, distributes, leases and provides financing for industrial and logging equipment. The company is also engaged in sawmill operations, oilfield fluids services and real estate.

“Year-end results for 2018 should see revenues reaching $100 million (30% growth rate) and earnings/share should equal at least $0.10/fully diluted shares (28 million common shares).  Management owns 50% of TCOR, according to filings. The stated book value prior to year end equals $1.15 (does not fully value the 5000 acres of timber located within Texas and Louisiana).

“If we value TCOR based upon fair valuation, then the current share price looks very compelling. If we assign a P/E of 1/2 growth (15X) a share price of $1.50 and if we assign 2X the current book, then we calculate $2.30. And upon calculating a current price/sales ratio (P/S), ~a value of 0.1 results. A value of 1 is very cheap). If we assign a P/S ratio of 0.5, then a share price of $2.00 results. We also assume that if the company was sold it could easily fetch $4-$6/sh. The reality is TCOR is extremely cheap and discounted value/patient investor types need only to apply.”

How to Find More Top Stock Picks

These are just two of the 70+ Top Picks offered by our contributors for 2019, whose favorites include growth, income, high-yield, and undervalued stocks. And they range from low-cost shares to blue-chip companies—a nice sampling of what you can expect in our regular monthly issues.

To receive those monthly issues, and to learn the names of all our top stock picks for 2019, click here if it’s growth you seek or here if you prefer high yields and a steady stream of income. Either way, you won’t be disappointed with the results!

Nancy Zambell

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Nancy Zambell, Editor of Wall Street’s Best Investments, has spent 30 years helping investors navigate the minefields of the financial industry. Nancy scours more than 200 advisories and research reports to select the top recommendations, which she collects for you in this easy-to-read digest.

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