What's on Your Stock-Shopping List? (XOM, CCJ, NE, FCX, ADM, PCL, CRESY, BHP, RTP)

On Monday I suggested writing up a list of stocks that you'd like to own, or would like to own more of. Shares of almost everything have been getting hammered lately, as the market has looked for an excuse to take a breather from what can only be called a break-neck bull trend over the past 24 months. And Japan's disaster fits the bill.

So on Monday I wrote, “Right now, it's tough to look at this natural disaster and the ensuing tragedy as a time to think selfishly. Most people will look at this opportunity to go shopping as distasteful. But you didn't cause this tragedy. Buying assets at distressed prices is a good thing for the markets. It creates liquidity and demand when the market needs it most.

The thing is: most people won't buy their favorite assets at distressed prices…

So my suggestion is to make a list of some of your favorite companies and assets that you want to own. Pick your price.”

Some folks wrote in to ask what I might have in mind. When I go grocery shopping with my wife, I have a list of things we need, like milk, bread, eggs, butter, and I buy these things unless the price is ridiculously high – but I also have a list of things that I will buy if they're under a certain price.

For instance, sometimes I can get a large package of boneless, skinless chicken breasts for less than $2 a pound. It doesn't happen very often, but I'm on the lookout.

Every now and then I can pick up porterhouse steaks for under $9 a pound – and I'll jump on the opportunity.

So when I say that you should make a list of stocks to buy, I'm not saying you should jump into the market and buy them just because they're down a few points. I'm saying you should name your price, have the capital ready, and jump on the opportunity IF it comes.

And if this correction is even half as big as I expect it to be, just about every boat will get sunk as the tide recedes.

Even big, blue chip stocks that every investor should own will get hammered.

Last year, Exxon-Mobil (NYSE: XOM) shares sold for less than $60 – even cheaper than they were during the depths of the 2008-2009 bear market – briefly selling for less than 10 times earnings.

That's the kind of company that should be on your shopping list at that kind of price.

Uranium seems to be one of the hardest hit sectors – and for good reason. But the uranium story isn't going anywhere, as I wrote yesterday.

I'd look into picking up shares of Cameco Corp. CCJ at under $25 a share. Cameco is the world's largest uranium miner by a very large margin. Owning shares of this company at under $25 a share gives you a realistic chance at doubling your money when uranium prices resume their march towards their old highs of $136 a pound.

Some of the other companies on my shopping list:

Deep sea driller Noble Corp (NYSE: NE)

Copper and gold behemoth Freeport MacMoRan FCX

Agriculture giant Archer Daniels Midland ADM

Timberland company Plum Creek Timber PCL

Small-cap South American agriculture firm Cresud CRESY

Mining giant BHP Billiton BHP

Mining giant Rio Tinto RTP

I won't give price-targets for all of these companies, because it's pretty easy to look up 52-week lows, or price-to-earnings data on these mostly large, mostly blue-chip companies.

Anytime you can buy profitable, healthy, low-debt, low-liability blue-chip companies below their 52-week lows, or at extremely cheap PE valuations, you should take the opportunity.

I've listed commodity-based stocks, but you could make the same statement about any blue chip company. Just be patient, have a plan and follow through and you'll make out like a bandit.

Good investing,

Kevin McElroy

Editor

Resource Prospector