When picking stocks, everyone is a prospector. You look at good companies that you think are undervalued but have all the right pieces to succeed and earn you some money.
With football -- and most sports -- when picking the surprise team of the year, it's the same deal. I look for teams that have the right players and have a lot of upside. The potential for upside could be there because the team underperformed last year, it acquired new players, its younger players are starting to mature, or the team is simply starting to gel.
This season, I think the Minnesota Vikings will be the surprise of the NFL. Theycame close last year, but if their quarterback Tarvaris Jackson can make a slight improvement, I think the Vikes will challenge the odds-on favorite Dallas Cowboys for tops in the NFC.
The Vikings have one of the best youngest defenses in the league, and they have
best young running back in the league in Adrian Peterson. That combination in the NFL usually leads to winning games and eventually championships.
That's where Tarvaris comes in. Last year, the battle cry was "just don't lose it Tarvaris." This year, he will have to step up and win a game or two. If he does that, I believe they will be in the NFC championship game.
Here is a company I believe is ready to step it up as well:
. It's diversified, its near-term outlook is good and it's undervalued.
Danaher makes and markets professional, medical, industrial and consumer products. It operates in four segments: professional instrumentation, medical technologies, industrial technologies, and tools and components. Danaher is best known as the maker of Sears Craftsman tools.
Its professional instrumentation unit makes and sells professional electronic test tools and calibration equipment. Its medical technologies area offers acute care diagnostic instruments and high-precision optical systems. This company has a lot of lines of business, which is an especially good thing during a rocky market. When you have a company like that, you are getting diversification and are, in effect, spreading your risk out.
Two weeks ago Danaher reported second-quarter earnings that pleasantly surprised Wall Street and offered an improved outlook for the remainder of the year. That's always a good sign. The company said earnings rose 17% to $363.4 million, or $1.09 per share. Danaher earned $311.2 million, or 96 cents a share in the year-earlier period. Analysts had been calling for $1.06 a share.
The industrial conglomerate also said it now expects to earn between $4.34 and $4.42 for the full year. Its previous estimate was $4.30 to $4.40.
Danaher doesn't have much debt on its books. It has $1.87 billion in operating cash flow and a forward price-to-earnings ratio of 16.23. Additionally, more than 75% of the stock is owned by institutions. The company is in a good position to be able to snap up more companies, as is management's plan. All of this bodes well for investors because I believe Danaher is currently undervalued.
The stock was gaining ground on Friday, trading recently at just shy of $81. However, it is still off more than 8% for the year, despite beating its numbers and providing a better-than-expected outlook. Its 52-week high is $89.22, which it hit back in December.
This is a smart investment.
Keep moving the chains!
At the time of publication, Brown had no positions in stocks mentioned, although positions may change at any time.
Tim Brown played 16 seasons in the NFL, where he made nine Pro Bowls. After a brief stint with the Tampa Bay Buccaneers in 2004, Brown retired as an Oakland Raider. He was a Heisman Trophy winner in college for Notre Dame.