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10 STOCKS

BUY
NOW
TO

any

investors

are

cautious

about

prevailing valuations, earnings results,

volatility and global events. And although we are

in the sixth year of a bull market, neither the S&P
500 nor the Dow have made great strides so far
this year. So where do investors go from here? For
guidance, we asked some of our top investment
advisors for their best ideas for the current market.

John Dobosz, Forbes Dividend Investor

Crown Castle International (CCI)
Most real estate investment trusts own buildings like office buildings, shopping malls or apartments that
produce streams of rental income passed on to shareholders as dividends. Because of the appealing
pass-through nature of REITs, which allows companies to avoid taxation at the corporate level if at least
90% of net income is paid out to shareholders, a number of companies that aren't traditional landlords are
electing to convert to REIT status. Houston-based Crown Castle, which converted into a REIT in
January 2014, is a good example.
Crown Castle is the largest provider of shared wireless infrastructure in the U.S., with 40,000 towers,
14,000 small cell nodes and 7,000 miles of fiber. It also operates 1,800 towers in Australia. Revenue is
expected to grow 2.1% to $3.77 billion this year, with earnings rising 5% to $4.40 per share. Following its
REIT conversion last year, Crown Castle jacked up dividend payouts from $0.35 to $0.85 per quarter. With
$3.28 in annual dividends at the current rate, CCI currently yields 4.0%.
Current valuation measures strongly suggest that Crown Castle has room to run higher in price.
Trading at 32.3 times trailing 12 months of free cash flow, CCI sports a 19% discount to its average
price-to-free cash flow ratio over the past five years. Also, with enterprise value of 18.9 times expected 2015
EBITDA, Crown Castle presently trades 16% below the five-year average enterprise value to EBITDA multiple.

W W W. F O R B E S . C O M / N E W S L E T T E R S

Education Realty Trust (EDR)

Real estate investment trusts do well when long-term interest rates move lower. That's been the case for
most of the past six years, and despite the end of quantitative easing last fall, the yield on the 10-year
Treasury note remains below 2%. One REIT with a compelling dividend yield and modest valuations is a
big landlord in college towns around the United States, particularly in the Southeast.
Memphis, Tenn.-based Education Realty Trust was founded in 1964 and is one of the largest
owners, developers and managers of collegiate housing. It owns or manages 73 communities with more
than 40,000 beds serving 53 universities in 23 states. Revenue this year is expected to climb 13% to $233.2
million, although earnings per share are expected to decline to $1.79 from $1.86. Over the past four years,
the quarterly dividend has risen from $0.15 per share to the current rate of $0.36, good for a yield of more
than 4.3%.
At an enterprise value 21.1 times expected 2015 earnings before interest, taxes, depreciation and
amortization, EDR trades at an 18.5% discount to its five-year average enterprise value to EBITDA
multiple. In addition, with a stock price of 9.8 times free cash flow per share over the past 12 months, EDR
sports a 16.5% discount to its five-year average price-to-free cash flow ratio.
One final bit of evidence to burnish the bullish case on EDR, the company's chief financial officer, Edwin
Brewer, Jr., purchased 1,000 shares of EDR at $35.25 back on February 25. While the absolute dollar value
of $35,250 is not massive, it is substantial for a guy with a salary last year of $217,000.

W W W. F O R B E S . C O M / N E W S L E T T E R S

Destination Maternity (DEST)

I always tell my Forbes Dividend Investor subscribers to use a 10% trailing stop loss on all positions I
recommend. The reason for doing this is to preserve profits or limit losses when a stock starts to move against
you. Our experience with Destination Maternity is a good example of how the 10% stop can help. I originally
recommended DEST in October 2012 at a dividend-adjusted price of $17.60. One year later the stock was above
$32 per share, but by January 2014 it had slipped more than 10% below those highs, prompting us to get out
at $28.80, a move that kept us from experiencing the pain of owning a stock that lost half of its value. After that
mighty tumble, the stock has stabilized just below $15, and it looks good for fresh buying again.
Moorestown, N.J.-based Destination Maternity designs and retails maternity apparel through 1,894
retail locations in the U.S., Canada, Mexico, Puerto Rico, the Middle East and South Korea. Formerly known as
Mothers Work and founded in 1982, company brands include Motherhood Maternity, A Pea in the Pod and
Destination Maternity. It also distributes maternity wear via partnerships with retailers like Macy's, Sears and Kohl's.
The single analyst who follows the stock expects revenue to climb 9.9% to $568 million for the current year that ends
on September 30. There is no published earnings forecast for the current year. Destination Maternity has not debt and pays
$0.80 per year in dividends that are amply covered by $1.90 per share in cash from operations over the past 12 months.
Valuations look lean and suggest a bargain. At 0.38 times expected 2015 sales, DEST trades at a 24%
discount to its five-year average price-to-sales ratio of 0.50. It also trades at an enterprise value 5.64 times
expected 2015 EBITDA, a multiple 5.2% lower than the five-year average EV/EBITDA ratio.
The company looks fertile for value-minded investors with its fat 7.6% yield, discounted valuations, and
some insider buying by directors and the CEO.

W W W. F O R B E S . C O M / N E W S L E T T E R S

Taesik Yoon, Forbes Investor; Forbes Special

Situation Survey
Micron Technology (MU)
Micron Technology is one of the worlds leading providers of advanced semiconductor solutions,
specializing in high-performance DRAM, NAND Flash and NOR Flash memory chips and other products
that provide for higher data transfer rates, reduced package size, lower power consumption, improved
read/write reliability and increased memory density in leading-edge computing, consumer, networking,
automotive, industrial, embedded and mobile applications.
Hurt by disappointing revenue guidance for the first half of the year and similarly soft outlooks
provided by competing storage chipmakerswhich have increased concern about the health of global
demand for DRAM and NAND productsinvestors have punished MUs stock, sending it down roughly
20% so far in 2015. But I believe the companys near-term headwinds are primarily due to production
disruptions stemming from equipment upgrades to deploy next-generation process technology in its
DRAM memory business. However, as these production constraints fade later in the year, I expect output
to return to levels more reflective of its growing demand environment. Given the exceedingly low valuation
shares currently trade at, the stock should recover quickly as this materializes.

W W W. F O R B E S . C O M / N E W S L E T T E R S

Green Dot (GDOT)

Green Dot is the largest provider of general purpose reloadable (GPR) prepaid debit cards and cash reload
processing services in the U.S. These cards are issued as Visa- or MasterCard-branded cards and can be used by
consumers at merchants who accept these brands. Uncertainty over the fate of its Walmart MoneyCard
program, which has historically been responsible for a sizable portion of the companys revenues and is up for
renewal at years end, had contributed to poor performance in GDOTs stock over the past six months. Yet
thanks to numerous customer additions, new distribution channels and key acquisitions made during the past
several years, the company has significantly diversified its operations away from this program.
As a result, it is only expected to represent 15% of adjusted operating income on a cash basis in 2015.
Thus, even in the unlikely event that GDOT does lose this business, I believe that investors are
overestimating the negative impact. When you also consider the strong growth Green Dot should continue
to enjoy in the rest of its businesses stemming from its increasing retail presence, expanding banking
operations and favorable market opportunities, I dont think the stock will stay down for long.

W W W. F O R B E S . C O M / N E W S L E T T E R S

Navigant Consulting (NCI)

Navigant Consulting is an independent global professional services firm that specializes in providing
consulting services to clients that operate in highly complex market and regulatory environments or are facing
transformational change and significant regulatory and legal issues.
Due to increased expense associated with ongoing effort to strengthen its senior leadership, realign several
businesses and expand its business process management services offerings, earnings declined for the first time
in three years and resulted in a 20% drop in its stock price in 2014. With guidance provided in February
suggesting earnings will be down again as expenses remain elevated to support these future growth driving
initiatives, shares have sunk further still. Yet buried in this outlook is the expectation that NCI will finally begin
to see meaningful benefits from its higher investment activity, which has already augmented and optimized its
workforce and enhanced its technology and business process management services capabilities. While these
benefits will initially favor the top-line, I think a recovery in profits and NCIs stock price wont be too far behind.

W W W. F O R B E S . C O M / N E W S L E T T E R S

Jim Oberweis, The Oberweis Report

SPS Commerce (SPSC)
SPS Commerce is a leading provider of cloud-based supply chain management solutions, providing
network-proven integrations and comprehensive retail performance analytics to thousands of customers
worldwide. Its cloud-based product suite improves the way suppliers, retailers, distributors and other
customers place, manage and fulfill orders. Implementing and maintaining supply chain management
capabilities is resource intensive and not a core competency for most businesses.
The SPS Commerce platform eliminates the need for on-premise software and support staff, which enables
suppliers to focus their resources on their core business. The SPS Commerce platform enables retailers and
suppliers to shorten supply cycle times, optimize inventory levels and sell-through, reduce costs and ensure
suppliers satisfy exacting retailer requirements. Approximately 60,000 customers across more than 60 countries
have used the companys platform to improve the performance of their trading relationships. SPS platform
fundamentally changes how organizations use electronic communication to manage their supply chains by
replacing the collection of traditional, custom-built, point-to-point integrations with a hub-and-spoke model
whereby a single integration to the SPS platform enables an organization to connect seamlessly to the entire SPS
Commerce network of trading partners. Solutions include fulfillment, assortment, analytics, sourcing, and enablement.
In SPS' latest reported fourth quarter, sales increased approximately 27% to $35.4 million from $28.0 million in
the fourth quarter of last year. SPS Commerce reported earnings per share of $0.18 in the latest reported fourth
quarter versus $0.13 in the same quarter of last year. These shares may be appropriate for risk oriented investors.

W W W. F O R B E S N E W S L E T T E R S . C O M

Richard Moroney, Dow Theory Forecasts; Upside

Aetna (AET)
Aetna grew sales 23% last year, helped by a 6% rise in membership. An acquisition and federally mandated
health insurance accounted for the enrollment gains. The company participated in 17 states public
exchanges last yearnone of its largest rivals got so deeply involved.
Managed-care stocks in the S&P 1500 Index have outperformed every other industry in the health-care
sector, averaging total returns of 66% over the last year. Despite those gains, managed-care stocks average
Dow Theory Forecasts Value scores of 56, well above the sector average of 40. Aetnas Value score of 66
is the highest among S&P 1500 managed-care companies.
Aetna grew operating cash flow 48% last year; the company has a history of sharing its cash with
investors. The dividend rose 11% in November, marking four consecutive years with a double-digit
increase. Over the last year, Aetna spent nearly $1.3 billion on stock buybacks, enough to lower its
share count more than 4%.

W W W. F O R B E S N E W S L E T T E R S . C O M

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Heartland Financial (HTLF)

Heartland Financial operates 86 banking locations, primarily in the Midwest and Southwest. In each of
the past two quarters, per-share-profit growth has exceeded 50% on double-digit revenue growth. The
banks efficiency ratio (non-interest expenses/revenue) improved to 72% last year from 75% in 2013.
Management expects to bring the efficiency ratio down to 65% by 2016.
Consensus estimates now project that per-share profits will be up 58% on 16% higher sales for the March
quarter. Full-year profits are projected to rise 14% to $2.50 per share on 13% revenue growth. Management
expects 2015 loan growth to resemble the 11% growth achieved last year. Growth should also benefit from
Heartlands $53 million acquisition of a Wisconsin bank in January. At 13 times estimated current-year earnings, the stock trades 14% below the median for S&P 1500 regional banks. Heartland has a current yield of 1.2%.

W W W. F O R B E S N E W S L E T T E R S . C O M

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Marc Gerstein, Forbes Low Priced Stock Report

LeMaitre Vascular (LMAT)

In health care, a sector that's an old-favorite in terms of inevitable and huge demand growth, we have an aging
population and the tendency of older people to experience more cardiac problems, especially when age is
compounded by diabetes and obesity, two conditions also on the rise. So it would seem that a company
exposed to cardiac care ought to fit right into the theme of inevitability. LeMaitre Vascular is just such
a company. It focuses on products used to treat peripheral vascular disease, situations where the blood
vessels become narrowed, obstructed, weakened or otherwise compromised thus diminishing the amount of
blood transported and, potentially, leading to stroke, ruptured aneurysm, pulmonary embolism or death.
LMAT sells products for use by vascular surgeons, mainly in connection with open surgery. There are
also some products aimed at less-invasive endovascular surgical procedures. There are many different
kinds of gizmos and gadgets used here; because its such a small company, LMAT focuses primarily on
niche differentiated products that dont attract as much attention from the larger players.
That said, once relationships with vascular surgeons are established, LMAT is better able to cross sell;
thats been allowing the company to edge its way from niche open surgery products into more
conventional open surgery products, and into endovascular products, as the surgeons with which
LMAT deals do more of these procedures.

W W W. F O R B E S . C O M / N E W S L E T T E R S

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Meanwhile, LeMaitre continues to flesh out its product portfolio both with internal development and
acquisitions. So how can we, as investors (and at least in my case, not a surgical expert) get a sense of
whether LMATs strategy works as well as the company suggests it should? Sometimes, plain vanilla
fundamental data can provide a helping hand. With a market cap of just $175 million, LMAT is clearly a
health care equipment and supplies pipsqueak. Yet its debt free and has a five-year average return on
equity of 6.28%, hardly a number that would make Apple green with envy, but a heck of a lot better than the
1.69% industry median, and five-year EPS growth has occurred at an average annual rate of 18% versus an
11% industry median. So LeMaitre has to have been doing something right. It pays a dividend (the yield is
a respectable 1.9%) and the price/sales ratio is 2.08, well below the 4.28 industry median.

W W W. F O R B E S N E W S L E T T E R S . C O M

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