IPL (Indian Premier League - cricket's equivalent of NFL) started its third season with a bang. It's fun watching cricket in India. I would be able to see couple of IPL matches on TV. I am rooting for Mumbai Indians - Sachin Tendulkar being in top form should help it get into Semi-finals.
Markets are holding onto gains made in last couple of weeks with each of last three sectors I recommended (Energy, REIT and Banking) making significant gains. Now onto my next sector recommendation:
Insurance Sector:
This sector is kind of proxy for asset valuations since companies in this sector invest policy premiums in various kind of assets ranging from bands from banks, REITs and government bonds. Many companies in this sector were on verge of bankruptcy in 2008-2009 - AIG being the biggest and well known company. Now that asset valuations have stabilized and many companies have fixed their valuations, there are many stocks in this sector which could return 50% in next 18-21 months (by end of 2011). Here are some of the recommendations:
- Small cap: PNX ($2.80), CNO ($5.80)
- Mid-cap: GNW ($15), HIG ($25), LNC ($25)
- Large-cap: MET ($40) and PUK ($16)
Once economy fully recovers, these companies would resume their dividends with yields in 4-6%.
Finally there is some momentum in health-care bill. It would be leadership test for President Obama if he can get it through political quagmire ! Good luck President !
/Shyam
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