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The Obama Portfolio

3 Stocks to Profit from the Stimulus Plan

Written by Brian Hicks
Posted March 18, 2009

On February 22, 2005, Barack Obama, a U.S. Senator at the time, placed a trade on a tiny biotechnology company out of Oregon. The biotech company's name is AVI Biopharma.

Records show that Obama purchased tiny AVI Biopharma just above $2 a share.

What was AVI's claim to fame? Not much. 

It's a biotech company that's been around for years. It develops drugs intended for the use to treat infectious diseases... some of which the Department of Homeland Security have deemed "bioterrorism" viruses like West Nile, Dengue fever, SARS and Ebola.

I know the company very well. I have played golf with former AVI CEO Dennis Burger in Sun Valley, Idaho. And Dennis gave a presentation at my biotech conference in August 2000.

But even though the company was founded in 1980, it has never successfully brought a drug to market.

25 years in business. 0 drugs on market.

So why did Obama buy it?

Maybe he knew something 99.9% of investors didn't...

You see, 8 months after Obama bought the stock, the company was awarded a $28 million contract from the federal government to research treatments against biological warfare or a bioterrorism attack.

AVI Biopharma spiked in price... and days after the announcement, Obama sold his shares and booked a 73% profit.

Not bad for a community activist from Chi-town, right?

Sure, but Obama understood one of the most fundamental trading strategies on the street: Buy the rumor, sell the news.

Add to that "don't fight the Fed" and what you have is the potential for a massive payday.

But here's the best part... the Obama trading strategy is about to pay off again. Today, inside his 1,047-page stimulus plan, the White House pinpoints potentially massive deals for 3 more companies that could pay even larger gains.

I'm calling it the Obama Portfolio: 3 Stocks to Profit from the Stimulus Plan


The investments are...

1. Argentex (AGXM - OTCBB)

2. SunPower (SPWRA - NASDAQ)

3. PowerShares Dynamic Building & Construction ETF (PKB)

One of the stocks - Argentex (AGXM - OTCBB) is up nearly 166% since the election.

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Why is Argentex rallying?

Because in addition to its gold and silver potential, 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...

Argentex: Not Just A Gold Stock

Many factors limit the efficiency of photovoltaic cells. 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 I own Argentex in my personal portfolio, I rate it for aggressive investors. It currently trades for just less than $0.40 a share. In my opinion, Argentex has 10-to-1 return potential within the next 12 months.

If you're looking for a solar play on the Obama plan but don't want to get too aggressive, look at SunPower (SPWRA).

SunPower does $1.4 billion in annual revenue, and unlike many renewable energy companies, it has been profitable.

When the stimulus money begins flowing into the economy, SunPower's solar panels should fly off of the shelves.

Like many renewable energy companies, SunPower's stock has plunged during the credit crisis.

But it now trades for $20 a share... a level I think it will rally from.

My final play on the Obama Stimulus Plan is the PowerShares Dynamic Building & Construction ETF (PKB).

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 $9 a share. I do own this in my personal portfolio... and I think it's a great way to play the Obama stimulus with limited risk.

Profitably yours,

Brian Hicks

Publisher, Wealth Daily

PS. To see what other areas Obama is about to bounce, check out this report from my colleague and clean energy expert Nick Hodge. It details where billions of stimulus dollars will go, and how you can use them for you own personal gain.

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