Who would have thought that in a year where the U.S. has taken on trade wars with its allies and competitors — including the second largest economy in the world — and has begun to raise interest rates in earnest. the markets would still be setting new records.
And we’re seeing the mid and small cap companies start to pick up some of the momentum that big caps scored.
The thing is, the big caps could take their tax break and buy back stock to boost earnings. Smaller firms don’t have that ability as much — their growth is for real.
The 10 triple-A stocks to buy for the rest of 2018 below have real growth going for them and are just starting their run.
Ligand Pharmaceuticals (LGND)
Ligand Pharmaceuticals Inc (NASDAQ: LGND) is a unique type of biotech company. Instead of looking to take a drug or a family of drugs through the entire ‘lab-to-fab’ product development process, LGND focuses on drug discovery, early-stage drug development and product reformulation.
It then partners with firms to take its work the next level. This is the new age of biotech companies and LGND is a prime example of how it should be done. Right now, it has partnered on 2 drugs focusing on multiple myeloma, one that’s a novel antibiotic and one that controls platelet deficiencies.
Up over 100% year-to-date, LGND is just getting started.
CyberArk Software (CYBR)
CyberArk Software Inc (NASDAQ: CYBR) is in one of the hottest and most important tech sectors for the next decade or more – cybersecurity.
CYBR is an Israel-based firm that has business all over the world. That’s pretty impressive given the fact it has a $2.8 billion market cap.
It has a client list that top 4,000 companies, including 50% of the Fortune 100 and 30% of the Global 2000 firms. This also is evidence that its security systems work and play well with other systems, including legacy hardware and software.
And it keeps building on its strengths as is evidenced in the fact that CYBR stock is up 93% in the past 12 months.
Intricon Corporation (IIN)
Intricon Corporation (NASDAQ: IIN) is a Minnesota-based firm that has been making hearing aids and miniature and micro-miniature body worn devices since 1930.
While IIN is a big player in this healthcare equipment segment, it only sports a market cap of $493 million. The thing is, it is making all the right moves to sell its products to the broadest market it possibly can.
It sells both through healthcare services as well as direct to consumers. And given the graying of the U.S. population, this potential group of customers is growing by the millions every year.
IIN is also smart about consolidating the business by swallowing up competitors. IIN stock is up a whopping 374% in the past 12 months, and 190% year-to-date.
BioTelemetry Inc (BEAT)
BioTelemetry Inc (NASDAQ: BEAT) is riding a wave that continues to crest. It does what its name suggests, it makes wireless and mobile medical devices. Fundamentally, it builds real-time monitoring devices for monitoring blood-glucose levels for diabetics and cardio information for heart patients.
While the broad strokes of healthcare are still up in the air, the fact is companies that can allow medical professionals access to real time patient data without having to have patients tying up office time is valuable to all concerned.
BEAT’s technologies are precisely the kinds of products that will be encouraged from the healthcare practitioners’ side as well as health insurers.
Up 116% YTD, this sector is set for long-term growth, and BEAT along with it.
Viper Energy Partners LP (VNOM)
Viper Energy Partners LP (NASDAQ: VNOM) is an upstream energy company that trades as a limited partnership.
To unpack that a bit more, upstream energy companies focus on exploration and production (E&P) work, finding properties and then getting the stuff out of the ground. VNOM operates properties in the heart of the Permian Basin, one of the most productive shale energy deposits in the U.S.
As for its partnership designation, that means shareholders are viewed as business owners and are ‘paid’ the net profits in the form of a dividend. Right now, VNOM is delivering a 5.7% dividend.
This is a highly cyclical sector and right now U.S. E&P firms are doing very well — demand is rising, prices are rising and the winter is approaching.
VNOM stock is up 125% in the past 12 months, and the upcycle in domestic energy is just beginning.
MCBC Holdings Inc (MCFT)
MCBC Holdings Inc (NASDAQ: MCFT) is a boat maker. That may seem like an odd company to buy into now that the summer is over and much of the nation are pulling their boats out of the water, rather than christening new ones.
But the trend is, people are buying more boats. Part of that has to do with financing. As cars have gotten more expensive and loans have increased in duration, it’s almost like financing a boat. The average car loan is now nearly 70 months, which can run up to 15 years or longer.
Even as rates rise, boat loans still remain relatively low. Also, consumers have lowered their debt levels since the financial crisis, so paying a regular amount over time isn’t as much of a stretch as it used to be.
Up 78% in the past 12 months, MCBC should continue to thrive as long as the economy stays on its upswing.
iRadimed Corporation (IRMD)
iRadimed Corporation (NASDAQ: IRMD) has been making equipment for magnetic resonating imaging (MRIs) machines almost since their inception.
MRIs use massive magnetic fields to display various structural parts of the human body. They can be used for total body scans or simply look at a hand or heart. Over the decades that have become invaluable tools and are a good alternative to some examinations that use radiation.
The challenge has always been that MRIs’ magnetic fields are so powerful, you can have any magnetic objects around them once they’re operating. That makes watching vulnerable patients in an MRI or delivering diagnostic fluids to patients challenging.
That’s where IRMD comes in. It’s the top supplier of MRI-friendly pumps and monitors.
This is another segment with plenty of growth potential as America’s population grays. IRMD stock is up 284% in the past 12 months.
NMI Holdings Inc (NMIH)
NMI Holdings Inc (NASDAQ: NMIH) is a leading mortgage insurance company. That means if you’re looking to buy a house and you don’t have the 20% down payment for the house, you have to get mortgage insurance on the difference between what you put down and 20%.
So, say you plan to buy a $400,000 house and need $80,000 for the down payment. You have $20,000, or 5%. You have to buy mortgage insurance on the $60,000 difference, which is usually rolled into your mortgage payment.
When houses are selling, NMIH is in its element. Basically it’s getting lots of cash, plus interest, from qualified people that it can then reinvest or loan out again, like other insurance companies.
NMIH stock is up 85% in the past 12 months and as the housing sector continues to grow, so will NMIH.
Rayonier Advanced Materials (RYAM)
Rayonier Advanced Materials Inc (NYSE: RYAM) is a specialty producer of cellulose products as well as paper and pulp.
It was spun off from its parent company Rayonier Inc (NYSE: RYN) in 2014. Basically, RYN had the timberland and RYAM would take what it needed to build out the specialty cellulose business.
Its products are used for filters as well as LCD screen production. Other products that use cellulose include, diapers, plastic films, textiles, food products, automotive filters, paint, pharmaceutical products and many more.
This is a cyclical business and we’re just seeing the upswing starting in earnest. It’s a solid company and may not go gangbusters but it has opportunity here to score solid gains of the expanding economy. It’s already up 37% in the past year.
Superior Drilling Products (SDPI)
Superior Drilling Products Inc (NYSE: SDPI) is the smallest company on the list, with a market cap of a mere $78 million.
But that cuts both ways. While the big integrated oil companies will pull in huge sums as prices rise, it will be offset by all their operations and while you can count on growth, it’s not going to be big, heart-pounding growth.
Granted, you’re risks will be lower, but this niche drilling rig pick is up 312% in the past 12 months. And because it has a solid contract fixing PCD drill bits for a major integrated energy firm, it has a stream of income as well as huge growth opportunities. PCD bits are the diamond bits that have transformed US shale drilling as well as deep offshore oil deposits.
If oil is in demand, SDPI will be making the most of it.
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Source: Investor Place