3 Strong Buys for March: Ford Motor Company (F), Priceline.com Inc (PCLN)

Published on March 4, 2013 at 12:31 am by The Motley Fool in News

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Raise your hand if you want to know the three best-performing stocks for March. (Raises Hand!) Wouldn’t it be great if investing in the best companies was that simple, so we could all retire early and with an abundance of cash? The only things we can do are to research previous financial performance and make educated guesses at future trends that will allow our stocks to continue performing better than the market.

The three stocks below have a lot going for them that makes them valuable investments. Depending on your investing style, I have a little bit for everyone. First up, we’ll look at a risky investment that could rebound sharply this year, and then we’ll take a look at two of my favorite stocks. Let’s check them out, and highlight the risk and reward potential and what it means for potential investors.

First up

Liquidity Services, Inc. (NASDAQ:LQDT) , isn’t a sexy business; but who cares as long as it makes money, which it has done consistently over the last three years. A company like this, with a small market cap of roughly $1 billion, is often overlooked by bankers, analysts, and media. This causes them to be inefficiently priced. That partially explains this stock’s high volatility, such as the recent 20% drop after the earnings report. That said, the 20% drop was too drastic, as the core business model is still in good shape. I think LQDT has an interesting niche, and could be poised for a rebound this year.

Its business model is an interesting combination, somewhere between eBay Inc (NASDAQ:EBAY) and Amazon.com, Inc. (NASDAQ:AMZN). It has an auction market for excess inventory or salvageable/damaged products. It focuses more on business-to-business rather than business-to-consumer, allowing commercial buyers to shop online for a huge range of products. It has major retailer customers such as Target Corporation (NYSE:TGT) and Wal-Mart Stores, Inc. (NYSE:WMT), and also has a nice chunk of business from government agencies.

I will be watching to make sure Amazon isn’t feeling froggy and willing to make a reverse leap into this type of wholesale business. If that doesn’t ever materialize, I’ll be happy with the purchase I made after the 20% drop, and expect the business to continue growing consistently.

Next up
Ford Motor Company (NYSE:F) has finally cooled down, after it raced up to $14 over the last few months. I’m still bullish on Ford Motor Company (NYSE:F), and the pullback gives investors a chance to jump in while the U.S. automotive market continues to rebound. Ford Motor Company (NYSE:F) has just about everything you could want in an investment. It’s drastically improved its debt situation, while boosting margins and operating efficiency. It’s making inroads in the biggest automotive market in the world, China, while defending its home turf in North America. It dominates a hugely profitable truck segment, and is quickly making up ground in mid-size vehicles, with the Fusion and Focus selling extremely well. It’s also gaining a lot of sales traction with its Escape and Explorer.