Time To Buy Your Small Cap Stocks

Historically, just before Thanksgiving is time to buy your Small Cap Stocks.  So what will give you a good look at what small cap stocks are out there on the market?  Lets look at the Russell 2000.  That is the best place to start.  Next you may ask, what are Small Cap Stocks?  You have never really spoken to us about them before.  They are individual stocks and the term Small Cap Stocks refers to stocks with a relatively small market capitalization. The definition of small cap can vary among brokerages, but generally it is a company with a market capitalization of between $300 million and $2 billion.  This being said, you might be surprised at some of the small cap companies that help make up the Russell 2000.

Why is now the time to buy your Small Cap Stocks to add to your portfolio.  The answer is pretty easy if you follow the history of the stock market.  December is the time when "historically" small cap stocks make their best move in the market for the year. 

Now you ask me, but how do I know what Small Cap Stocks to buy.  Well, as you know I have no crystal ball.  But with research I can certainly find likely candidates that will be winners in the future.  I am of course not able to research all 2000 of the Russell 2000, but I can certainly steer you towards a few likely winners in this sector.  I do want to remind you that in the Small Cap sector you are going to be finding things like restaurants, furniture companies, small pharmaceuticals, small retail, etc.  There is a list of the companies that make up the Russell 2000 of course on the Internet.  Here is the sight I like to use when doing research on Small Cap Companies.  http://www.marketvolume.com/indexes_exchanges/r2000_components.asp
Basically this website gives you the names and symbols so you can find or lookup a small cap company you might be interested in.

So now you ask me, Gus what are some of your top picks in this sector?  Again, I do not have a crystal ball, but if I were buying today here are some things I would be looking at in order of priority.  COKE, PZZA, GIII, RCII, TXRH, LZB, SONC, WST, USLM, CAKE, NWN, and PJC.

Yes the Coke we love and enjoy is on the Russell 2000.  It pays a good dividend, has below average growth due to it's world wide saturation of the market and just came off a stock split this past year.  If you are looking for dividends this is a good place to stick a little money.

Next lets talk about Papa John's.  A great Kentucky company founded and headquartered right here in Louisville, KY.  They are just coming off a spit within the last year and have continued growth and decent dividends.  I would be on board here for future improvements.  Papa John Schnatter, is no idiot and grew this company from a drive in window in a bar.  This is a winner.

What about GIII?  They are a clothing distributer and have many of their own lines.  They started out in leather good and quickly expanded into other markets.  They have had many great accusations of other companies and competition.  I once owned this stock.  It split, flew through the roof and I sold off at a wonderful profit.  No dividends here, but LOTS of continued growth potential.  Bill Cramer likes GIII and hosted them on his show a few months back.  I can just say I did will them and I think you can too.

RCII is commonly known as Rent A Center.  This company has been killing it.  Lots of this having to do with our current economy and those not being able to for the outright purchase of furniture and electronics in there home or have found themselves with poor credit due to the loss of jobs and foreclosures of their homes etc..  This company is the at the top of the competition and I think you could find great help in your portfolio with them.  I almost bought into this company several months back myself, but decided to save my money and go with another big boy company BABA when it came out as an IPO.

I have to talk about TXRH, commonly know as Texas Road House.  Another stock I formally owned that has made me a lot of money.  But I sold them and took my money and ran.  That does not mean they are a bad choice to invest in.  I have my methods for a reason, but there is still money to be made here.

Look at the rest of the choices I suggested.  But if you are going to invest in the majority of these stocks the time is now.  Good luck and I hope you find this information useful to your investment planning.

Gus S.


Disclaimer: Make sure to review any information found on this blog site with your personal financial advisor before making any decisions. I am providing general information and not financial advise. I am not a licensed stockbroker or financial advisor.