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Fortune’s Top Ten Picks For 2011 Fail To Beat The Market

Each year, Fortune publishes the list of the 10 best stocks of the coming year. According to this article on its website, Fortune is expecting its ten best stocks to increase their earnings at an average rate of 61% in 2011, vs. 14% for the S&P 500. The stocks in the Fortune list have an average forward PE ratio of 12, vs. 13 for the S&P.

Unfortunately Fortune’s favorite stocks have gained 1.5% since the end of 2010, vs. a 6.3% gain for the S&P 500 (SPY). Five of Fortune’s top 10 stocks managed to beat the market. Here are the first quarter performances of Fortune’s favorite stocks:

Mosaic Co (NYSE:MOS)

1. The Mosaic Company (MOS): The Mosaic Company is operating in the agriculture industry worldwide. In fiscal 2010, MOS reported total revenues of $6.76 billion, a decrease of 34.4% compared to a year ago. Annual net income was $827 million in fiscal 2010. MOS recently traded at $80.37 and has a 0.3% dividend yield. MOS gained 5.3% during the past 3 months. The stock has a market cap of $36.8 billion and a P/E ratio of 44.5.

2. Agrium Inc. (AGU): Agrium provides agricultural nutrients, industrial products, and specialty products. In fiscal 2010, AGU reported total revenues of $10.52 billion, an increase of 15.2% compared to a year ago. Annual net income was $714 million in fiscal 2010. AGU recently traded at $92.71 and has a 0.11% dividend yield. AGU gained 1% during the past 3 months. The stock has a market cap of $15.1 billion and a P/E ratio of 21.1.

3. The Dow Chemical (DOW): The Dow Chemical Company is one of the largest chemical manufacturers in the world. In fiscal 2010, DOW reported total revenues of $53.7 billion, an increase of 19.6% compared to a year ago. Annual net income was $1.97 billion in fiscal 2010. DOW recently traded at $37.91 and has a 1.6% dividend yield. DOW gained 11.5% over the past 3 months. The stock has a market cap of $44.6 billion and a P/E ratio of 22.18.

4. Transocean Ltd. (RIG): Transocean provides offshore drilling services worldwide. In fiscal 2010, RIG reported total revenues of $9.58 billion, a decrease of 17.4% compared to a year ago. Annual net income was $956 million in fiscal 2010. RIG recently traded at $78.82 and gained 13.4% over the past 3 months. The stock has a market cap of $25.46 billion and a P/E ratio of 26.69.

5. Royal Dutch Shell plc (RDS-A): Royal Dutch Shell plc is one of the leading oil and gas companies worldwide. In fiscal 2010, RDS.A reported total revenues of $368 billion, an increase of 32.4% compared to a year ago. Annual net income was $20.1 billion in fiscal 2010. RDS.A recently traded at $73.32 and has a 4.56% dividend yield. RDS.A gained 11.1% over the past 3 months. The stock has a market cap of $233 billion and a P/E ratio of 11.24. Bruce Berkowitz’s Fairholme had $12 million worth of RDS-A shares at the end of 2010.

6. Lennar Corporation (LEN): Lennar Corporation provides home building and financial services in the United States. In fiscal 2010, LEN reported total revenues of $3.07 billion, a decrease of 1.6% compared to a year ago. Annual net income was $95 million in fiscal 2010. LEN recently traded at $18.31 and has a 0.8% dividend yield. LEN lost 2.1% over the past 3 months. The stock has a market cap of $3.37 billion and a P/E ratio of 35.5.

7. East West Bancorp, Inc.  (EWBC): East West Bancorp, Inc. provides a range of personal and commercial banking services in the United States. In fiscal 2010, EWBC reported total revenues of $1.14 billion, an increase of 2.7% compared to a year ago. Annual net income was $121 million in fiscal 2010. EWBC recently traded at $22.29 and has a 0.2% dividend yield. EWBC gained 14.1% over the past 3 months. The stock has a market cap of $3.3 billion and a P/E ratio of 27.26.

8. Royal Caribbean Cruises (RCL): Royal Caribbean Cruises Ltd. operates in cruise vacation services.  In fiscal 2010, RCL reported total revenues of $6.75 billion, an increase of 14.6% compared to a year ago. Annual net income was $547 million in fiscal 2010. RCL recently traded at $40.83 and lost 13.1% over the past 3 months. The stock has a market cap of $8.8 billion and a P/E ratio of 16.24. RCL is one of the 10 Stocks Benefitting From Oprah’s Endorsement.

9. Entropic Communications, Inc.  (ENTR): Entropic Communications, Inc., is a fabless semiconductor company. In fiscal 2010, ENTR reported total revenues of $210 million, an increase of 81% compared to a year ago. Annual net income was $65 million in fiscal 2010. ENTR recently traded at $8.09 and lost 33% over the past 3 months. The stock has a market cap of $678 million and a P/E ratio of 9.7.

10. Apple Inc. (AAPL): Apple Inc. is a leading multinational company which provides consumer electronics, computer software and personal computers. In fiscal 2010, AAPL reported total revenues of $65.2 billion, an increase of 52% compared to a year ago. Annual net income was $14 billion in fiscal 2010. AAPL recently traded at $344.56 and gained 6.8% over the past 3 months. The stock has a market cap of $314.33 billion and a P/E ratio of 19.04. Nearly 200 hundred hedge funds own 4% of the outstanding shares. Hedge fund stars like David Einhorn, John Griffin, Stephen Mandel, Chase Coleman and John Burbank all own AAPL in their portfolio. Last summer, David Einhorn bought more than 800,000 shares of Apple (AAPL), arguing that the stock’s PE ratio is extremely low compared to its growth prospects. Einhorn paid less than $250 per Apple share.

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