Ultimately, Tesla Motors is a long-term bet that should reward patient investors down the road. For starters, the stock should get a significant boost later this year when Tesla is slated to begin the first deliveries of its long awaited Crossover EV, Model X. The company also has higher-margin cars in the mix now thanks to the recent launch of its P85D Model S. As a result, Tesla expects that more than 70% of the cars it produces in 2015 will be dual-motor, which should significantly boost margins for the company going forward.
These catalysts, together with the near-term weaknesses in its stock price, make Tesla Motors a compelling buy this month — particularly for investors with a three-to-five-year time horizon.
Andrés Cardenal picks Google: Google (GOOGL, Tech30) is not a very popular pick right now, the online search giant is being affected by falling ad prices in mobile, and the company is aggressively investing for growth, so costs are on the rise. In this context, Google missed earnings expectations over the past five consecutive quarters, and the stock is down by more than 15% from its highs of the year.
However, make no mistake, Google is still an exceptional company with rock-solid competitive strengths and enormous room for expansion.
Related: The U.S. Senate May Solve Apple’s $158 Billion Problem
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Related: People hate the new Keurig … and its stock
Looking past these issues, Coca-Cola has a lot to offer. The Atlanta-based company currently sports a dividend yield of 2.96%, which isn’t bad at all given long-term total returns from the stock market of 8%. Coke trades for just over 20 times forward earnings and is expected to grow earnings per share to $2.80 per share — up from an estimated $2.04 in FY 2015 — by 2018, according to analysts polled at S&P Capital IQ.
Where will that growth come from? Emerging markets. While Coca-Cola experienced a 1% decrease in sales in North America for the first nine months of FY 2014, it saw a 2% YOY increase in its Eurasia & Africa Region and a white-hot 5% increase in sales in its Asia Pacific Region. These markets are home to over 2 billion people and, if these results are indicative of anything, they love Coca-Cola’s products. Take heed, Coca-Cola may be down but it’s not out.
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