This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

7 UBS Stock Picks for 2012

Stocks in this article: CSX QCOM KBR MDR ISS VMW ARUN

The following commentary comes from an independent investor or market observer as part of TheStreet's guest contributor program, which is separate from the company's news coverage.

NEW YORK ( InsiderMonkey) -- UBS Investment Research's recently published report, "US Morning Meeting Highlights," discusses how several different companies are likely to be affected this year. The report was published Jan. 13 and we will summarize its main points.

UBS analysts are of the opinion that Obama's victory would have a positive impact on the "tech and industrial companies," but the "healthcare, financial, energy and consumer" companies will be negatively affected due to the tougher regulations imposed. A Republican victory, on the other hand could be beneficial for "universal banks, managed care, coal, defense, and high-end consumer stocks". In this article, we will discuss the buy-rated stocks mentioned in UBS's report.

Follow TheStreet on Twitter and become a fan on Facebook.

CSX (CSX) engages in the provision of rail-based transportation services. It has been given a buy rating by UBS. Currently, CSX is the market leader in freight transportation services in the U.S. Despite an adverse macro environment and a volatile market, CSX is expected to generate significant profits and strong returns in 2012. Shares of the company are currently trading at $23 per share and are expected to reach a target price of $31, based on the earnings per share estimate of $2.34, for the year 2013.

We are bullish about CSX. CSX reported gross and operating margins of 38% and 29.5%, respectively, higher than its competitor, Norfolk Southern Corporation (NSC). Also, it has a price-to-equity ratio of 14 times vs. the industry average of 18 times. As the company is likely to invest in its infrastructure program, margins are expected to improve this year. We believe that CSX shares are a good purchase for the longer term since the company is usually more vulnerable to headwinds, such as a decrease in soft-coal demand, during the short term. Jeffrey Vinik had the largest stake in CSX among the 350-plus hedge fund managers we are tracking. Jim Simons' Renaissance Technologies initiated a brand new position in CSX during the third quarter.

KBR (KBR) is an engineering and construction company that operates on a global scale. It has been given a buy rating by UBS. The current joint venture of JGC, Chiyoda and KBR is expected to reward investors as soon as the final investment decision is made. The completion of the contract is likely to add around $5 billion to the company's backlog. Shares of the company are currently trading at $32 per share and are expected to go north of $42. Also, earnings per share are expected to reach a target of $2.65.

1 of 4

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

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.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

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.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 18,053.71 +23.50 0.13%
S&P 500 2,088.77 +6.89 0.33%
NASDAQ 4,806.8590 +33.3870 0.70%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs