NEW YORK (TheStreet) -- With QE3 in full swing and $40 billion a month in cheap money flooding the market, it's no wonder there are very few oversold stocks to select from.
I am surprised at some of the gifts in this week's list. I find the market often makes little sense in how companies are priced. Emotion rules the day, but not the longer term and that is what gives us the ability to buy low when others are scared and profit when others are brave.
: RadioShack is one of the nation's largest and most trusted consumer electronics retailers in the U.S., and offers both on- and off-line shopping convenience. The company was founded in 1899 and is headquartered in Fort Worth, Texas. RadioShack Corporation trades an average of 2.8 million shares per day.
Fourteen out of 20 rate RadioShack a hold. Zero recommend a buy and six recommend selling. The average analyst target price for RSH is $2.72. For the most part, analysts have written the stock off.
After only 16 months, the CEO Jim Gooch stepped down under the pressure of falling revenue and share price. Gooch continues an exodus of C-suite members departing RadioShack.
Chief Marketing Officer Lee Applbaum resigned in March and Chief Merchandise Officer Scott E. Young left three months later in June. A change in thought may be just what the doctor ordered.
RadioShack is now offering a branded cellphone service reselling cricket wireless. The no contract segment in the wireless space is fast growing, but also lowest profitability per customer. RadioShack is more or less entering into a race to the bottom with other carriers. RadioShack will have to execute flawlessly to succeed.
Because flawless execution preceded the C-suite staff exits, RadioShack is a higher risk than the others in this report. You may be better off thinking in terms of having fun rather than marriage here. If you can grab 30% to 40%, maybe call it good and see if the price retraces for another buy. Rinse and repeat.
RadioShack ended dividends for an indefinite amount of time. I would not count on a dividend renewal for at least two quarters after the company posts profits on the board.
In the previous RadioShack earnings release on July 25, the closing price was $2.60. Shares are almost even at 1.5% lower.
One area that doesn't look good is the short interest. The short interest is altitudinous and is a strong warning that short sellers expect the share price to fall considerably. The short interest is 42.3%. There is a flip side to the coin though, if a catalyst pushes shares higher a short squeeze could choke the daylights out of short sellers and leaving short sellers twisting in the wind.
: Xcel Energy is predominantly an operating public utility engaged in the generation, transmission and distribution of electricity and the transportation, storage and distribution of natural gas. Xcel trades an average of 2.9 million shares per day.
The average analyst target price for XEL is $29.68. I am a customer of Xcel, but don't have much of an opinion either way. Since I have not had any problems, I don't know how well they treat customers with a problem. Not have a problem speaks well for their service though.
Xcel is especially attractive at the current price because you have a chance to buy an old school utility with a fat dividend on sale. The shares you buy today you can forget about and not care if the price moves higher or lower. Just sit back and collect dividends until cold fusion becomes reality.
Xcel currently pays $1.08 per share in dividends yielding 4%. Over the last five years, the dividend has grown by an average of 3.2% per year.
The last reported short interest is tiny. Short interest is 1.2%.
: Hewlett Packard is one of the leading global providers of computing and imaging solutions and services for business and home. The company is headquartered in Palo Alto, Calif. Hewlett-Packard trades an average of 19.8 million shares per day with a marketcap of $33 billion.
The average analyst target price for HPQ is $23.03. Looking at the chart, it appears HP has miles to climb before thinking of closing above $23. If there is one company on Wall Street in dire need of change at the top it's this one.
With HP, you have two choices, either flirt with it and take a point or two and call it good, or buy it and forget it. Unless you're fully stocked up on Rolaids, you don't want to check the price of your shares often.
The company currently pays 53 cents per share in dividends for a yield of 3.07%. The shares have fallen so much that the company is attractive as a yield play. The payout ratio is expected to float under 40% even if earnings fall further. Over the last five years, the dividend has grown by an average of 4.6% per year, but don't count on increases in the dividend unless the top and bottom lines improve.
Short sellers have not gathered in strength yet. The short interest based on the float is not a big concern. Short interest is near 3.7%.
Research In Motion ( RIMM)
: Research In Motion is a world leader in the mobile communications market and has a history of developing breakthrough wireless solutions. The company was founded in 1984 and is headquartered in Waterloo, Canada.
Analysts are more or less side-stepping this one like a politician avoiding a hot topic. Twenty out of 35 rate RIM a hold. One recommends a buy and 14 recommend selling. The average analyst target price for RIM is $8.96.
If you can pick up shares under $6.75 (which is often lately), buy lightly as it moves lower, and sell above $7.25. Rinse and repeat until they get bought out. RIM is going to get bought out in my opinion. I just don't see a way around it. Billions in intellectual property, plenty of subscribers including highly coveted government contracts.
They are burning cash, but they have enough to heat all of Canada without worry. The shares have fully discounted the situation and the balance sheet is greater than the share price after removing goodwill and other near valueless assets on the sheet.
The short interest is anything, but short. The number of shares shorted are markedly elevated and should be treated as warning that shorts anticipate upcoming price weakness. The current float short is 17.7%.
: Advanced Micro Devices is a world-class company with the innovation, execution, and vision to grow our leadership position in the industry. The company was founded in 1969 and is headquartered in Sunnyvale, Calif.
Price to Book
Sometimes I wonder if AMD is around for the sole purpose to demonstrate
isn't a monopoly. AMD makes great products, but missing out on the iPhone contract has left a mark.
I like AMD under $3.50 with a price target of $4.50 in the next 12 months.
Short interest with this stock is very high. More than one in five shares is short. Shorts are the smart money, but when they pile on this hard it can backfire too. The proportion of the float short is 20.2%. I think the shorts are trying a little too hard here. Even Intel doesn't want AMD to fall apart, not totally anyway.
: Intel is one of the world's largest semiconductor chipmakers. The company develops advanced integrated digital technology products, primarily integrated circuits, for industries such as computing and communications The company was founded in 1968 and is based in Santa Clara, Calif. Intel trades an average of 51.9 million shares per day.
Price to Book
Intel is my favorite play in this report. Intel is now paying a 4% yield again. Plan and simple, buying Intel near $20 a share is value investing with training wheels on.
Self-directed investing doesn't get any easier or more favorable in terms of risk vs. reward than Intel. The current price is a great level for adding to your current position or opening one. One of the attractive attributes of Intel is the macro-economic play it offers, while remaining relatively strong in the current level of uncertainty.
Investors can expect Intel to climb as the economy improves. What this means to the average investor is that by putting Intel inside your portfolio; you are better positioned to ride the recovery higher.
How long will it take before we get a recovery strong enough to lift shares back above $30? Who cares, the company will pay 4% while the payout ratio is under 40% and the price-to-earnings ratio is under 12. Intel is value buying with training wheels all the way.
Intel's balance sheet is a Gibraltar type of rock solid. The short interest based on the float is small and not a concern with only 3.5% of the float short.
I use Zacks.com, WSJ.com, Tradestation, and Reuters for my data. P/E is generally adjusted P/E based on an average number of shares.
At the time of publication, the author held no positions in any of the stocks mentioned.
This article is commentary by an independent contributor, separate from TheStreet's regular news coverage.