Alsin's Top Ten for 2010: Part 1
Arne Alsin's first of his three-part 2010 preview appeared Dec. 8 on RealMoney. Click here for a free trial, and enjoy incisive commentary all day, every day.
Up by 91% since it was posted last December, my top 10 list for 2009 has run circles around the S&P 500 index, which returned 26% for the same period. While it's impossible to predict performance for my new top 10, there is reason for optimism. There continues to be a massive disparity between price and value in many smaller companies. And so, like last year, the top 10 list for 2010 will be filled with smaller companies.
In this, the first of three installments, I'll recommend companies in banking, apparel and food products. While their respective market caps range from $150 million to $400 million, I expect each will grow to at least $1 billion in market value in the coming years.
Metro Bancorp (METR): Everybody in the galaxy (and beyond) is afraid of small bank stocks, making it fertile ground for bargain-hunting. Also, it's worth rummaging through this sector because consolidation and closure have shuttered a lot of capacity. It sets the stage for a growth-oriented small bank like Metro, based in Philadelphia.Metro was founded in 1985 as a franchisee of Commerce Bancorp. It became independent when parent company Commerce Bank was sold to Toronto Dominion bank in 2007. Metro is in the final stages of acquiring Republic First Bancorp (FRBK) and, upon completion, the bank will have 45 branches. It currently sells at 75% of book value. Metro stock is especially compelling because of its a long-term growth potential. Many of its executives are from Commerce Bank, a bank that grew in value from $200 million to $4 billion in 15 years, through deposit growth that averaged nearly 25% per year. Through exceptional branch convenience and service (longer hours, better sites and so on), and a unique culture, Metro has a chance to grab large chunks of market share. Using the same strategy, Commerce grew its market share in Philadelphia from 1.6% in 1995 to 11.4% in 2008. That's the sort of opportunity Metro is contemplating today, and, if successful, shareholders will benefit handsomely.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
24/7 market commentary from Jim Cramer and 20+ veteran Wall Street gurus. Get access to the latest trading ideas on stocks, options, and ETFs as well as a real-time forum to see the pros exchanging their investment ideas.
- Jim Cramer + 20 Wall Street pros
- Intraday commentary & news
- Real-time trading forum
- Actionable trade ideas
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV