The Obama Portfolio: Potential Return of 590% During His First Term As President

Tuesday, February 17, 2009, could go down as one of the most significant days for Wall Street. On that day, President Barack Obama signed the $787 billion stimulus package. . . the biggest such spending bill ever passed into law.

As soon as the law became Public record, I had my research team read every single page, looking for the very best investment opportunities.

You see, buried deep in the 1,000+ paged spending bill, the White House pinpoints massive deals for companies. . . companies that are publicly traded and available to the average stock investor like you and me.

To meet Obama's pledge to "save or create 3.5 million jobs and get our economy back on track," the stimulus package provides a plethora of perks for a whole host of companies... from renewable energy to construction.

The Wealth Daily research team has identified 3 companies that will benefit from the Obama spending plan… and could return investors in excess of 590% over the next four years. In fact, one of the stocks we’ve identified as a beneficiary of the stimulus plan — a company called Argentex (AGXM - OTCBB), is up 433% since the election of Obama.

We’re calling these 3 investments  The Obama Portfolio: 3 Stocks to Profit from the Stimulus Plan.

They are as follows...

Argentex discovered the unique indium-bearing silver polymetallic Pinguino deposit, has carried out extensive diamond drill testing, and still retains 100% ownership of the property.

The company acquired Pinguino in early 2004 and immediately commenced exploration. Argentex has since completed five successful drill programs, uncovering precious metal veins and an epithermal silver-indium polymetallic deposit concentrated in the center of the property. This discovery was the first of its type in Santa Cruz.

With four operating silver-gold mines, Santa Cruz is one of Argentina’s most mining-friendly provinces.

Though Argentex is a tradition junior mining company in precious metals, it’s the indium potential that has the market so excited.

You see, Argentex's massive mine in Argentina could contain as much as 20% indium.

And indium is being used in high-efficient solar cells. This could be huge. . . and could push Argentex's stock over $10 a share.

Argentex: Not Just A Gold Stock

Many factors limit the efficiency of traditional photovoltaic cells used in solar panels. Silicon is cheap, for example, but in converting light to electricity it wastes most of the energy as heat. The most efficient semiconductors in solar cells are alloys made from elements from group III of the periodic table, like indium.

With Obama pushing renewables hard in his Green Building Agenda, solar energy is going to be a major play in the energy complex.

According to a February report published by Piper Jaffray:

Federal building solar market may be larger than all of U.S. solar market today: While specific solar carve-outs are not recognized, wind, biogas, and geothermal are unlikely for federal buildings or schools. Thus we believe rooftop and BIPV solar are the prime beneficiaries; the GSA estimates 75% of projects will use solar technology.

Indium demand for solar cells will increase dramatically.

Now, even though Argentex is a proven winning investment (up +433% since Nov. '08), I rate it for aggressive investors. It currently trades for just less than $0.80 a share. In my opinion, Argentex has 15-to-1 return potential. . . representing a gain of 1,500%. This stock alone could help you rebuild your portfolio, and then some.

I rate Argentex a buy under $1 a share.

One of the biggest beneficiaries of the Obama stimulus plan is renewable energy, specifically solar energy.

There are dozens of publicly-traded solar companies out there for us to choose from. So let's jump right into the main reasons we like SunPower.

Extensive and Integrated Product Line

SunPower's product line isn't one dimensional, as it includes the following:

• Solar cells
• Solar panels
• Inverters
• Power-Guard roof systems
• T-10 solar roof tiles
• SunTile roof integrated systems
• Tracking systems

Basically, SunPower's product and service portfolio covers pretty much the entire value chain in the PV industry. And in this industry, that's a solid advantage.

Strong R&D

In an effort to deliver the highest efficiency solar cells, SunPower has spent millions on R&D. $13.5 million in 2007 alone. The result is the most efficient solar cell technology in the marketplace - 22%. The company also has a full scale prototype with an efficiency of 23.4%. Those should be in commercial production by 2010.

Strong Financials

Despite a very rough year in the market in 2008 (which has nothing to do with the company's potential, and everything to do with the overall marketplace), SunPower has demonstrated pretty impressive revenue growth over the past few years.

During the fiscal years ended Dec. 31, 2007, 2006, and 2005, the company pulled off revenues of $774.7 million, $236.5 million, and $78.7 million, respectively. That's an increase of 227.6%, 200.4%, and 622.1% for the years 2007-06 and 2006-05 respectively.

Secured Silicon Supplies

Even with a continued silicon crunch, SunPower has secured enough silicon to deliver 255 MW in 2008, 450+ MW in 2009, and 650+ MW in 2010. And we expect to see a wealth of new silicon coming into the marketplace by 2010.

Favored Product

You would think with so many solar manufacturers out there, it wouldn't be hard for independent installers to get panels. But the fact is, after talking to a number of installers, these panels aren't just sitting around in a warehouse somewhere, collecting dust. No matter the manufacturer, these things move fast. But despite the fact that most of the installers I've spoken with will pretty much take what they can get - most of them seem to prefer SunPower. The reason? They're easy to install, everything is sent in "pods" which include all the inverters and other added components, and the high efficiencies allow them to offer a better product for their customers.

Utility-Scale Solar

Sunpower's also in the Concentrating Solar game.

The company's T20 Tracker manufacturing facility in Spain is producing decent volumes now, and is currently supporting about 45 MW of power plant projects. These systems also produce up to 30% more power than fixed-tilt systems.

SunPower also announced in August that it entered into a utility-scale PV power contract with Pacific Gas and Electric for a total of 250 MW.

On January 29, 2009, SunPower announced its 4Q and fiscal year, 2008 results.

• Revenue for the fourth quarter, 2008 increased 79% from the prior year to $401 million.
• Revenue for the fiscal year, 2008 increased 85% from the prior year to $1.43 billion.
• On a GAAP basis for the 2008 fourth quarter, the company reported gross margin of 27.9%, total operating income of $55 million and net income per diluted share of $0.35.

Here's what SunPower CFO, Dennis Arriola, had to say when the earnins were released:

The long-term solar industry fundamentals remain very positive and the company's 2009 sales pipeline is made up of identifiable customers and projects. Given the continuing weak credit environment, our ability to meet the high-end of the revenue and earnings-per-share ranges will be dependent on improved access to the project financing markets.  We expect our first-half of 2009 performance to be materially affected by seasonal factors and the continuing impact of the credit crisis.

Moving beyond the credit crisis, we believe that with the solar cell efficiencies the company can deliver, installers will continue to favor SunPower. As long as demand remains strong, SunPower will have more than enough business. And with the expected installed systems cost reductions, the company will only further its competitive advantage over the long-term.

SunPower isn’t as aggressive as Argentex, but it should provide investors good growth potential in the renewable energy sector. We think it could hit $64 a share. . . a gain of 156%.

This ETF gives you broad exposure to companies that will benefit under the infrastructure building boom Obama is planning. Companies like Caterpillar, Jacobs Engineering, Fluor and Lowe's.

It trades just less than $12 a share. I do own this in my personal portfolio. . . and I think it's a great way to get broad investment exposure to the Obama stimulus with limited risk.

We believe that once the stimulus money starts flooding into the economy, PKB will be trading above $20 a share.

In conclusion, we think these 3 stocks give investors of every stripe a way to play the massive Obama stimulus plan. Whether you're looking for steady and consisted growth. . . or looking for a grand slam home run, the 3 stocks in the Obama stimulus Portfolio has something for everyone.

Profitably yours,

Brian Hicks
Publisher and Investment Director, Wealth Daily

P.S.  By the way, all of this spending under the Obama stimulus plan will come at a cost. Namely, the U.S. dollar is headed for a serious devaluation. This means that gold — the ultimate hedge against a declining dollar — will most certainly skyrocket in price. And gold analyst Greg McCoach has discovered an unique investment. . . one that pays you $2 every time gold goes up $1. It’s known as Gold's "Doubling Effect." Between January and March of this year, the "Doubling Effect" returned investors 53% — while gold went up 22%! This free report shows you how this investment works.