This post is one in a series in which more than 60 newsletter advisors share their Top Stock Picks for 2011. This special report is courtesy of TheStockAdvisors.com.

"Altria (MO) -- our top investment idea for the coming year -- is an extremely simple business; the company provides a specific product, tobacco, to a specific consumer niche, tobacco users," says dividend expert Kelley Wright.

The editor Investment Quality Trends explains, "While distasteful, if not outright abhorrent to much of the population, tobacco is the poster-child of 'sinful' indulgences, which makes Altria Group the poster-child of 'sin' stocks.

Continue reading Top Picks 2011: Altria (MO)

Top Picks 2011: Altria (MO) originally appeared on BloggingStocks on Fri, 07 Jan 2011 10:00:00 EST. Please see our terms for use of feeds.

One of my largest holdings and growing is Diageo plc (DEO), which was one of my 2009 stock picks. At the time I recommended it, I figured that the economy was going to drive everyone to either church pews or bar stools and that rational worked out. Today, in a battered market, folks must be hitting the bottle because Diageo is up when the majority of stocks are down. During the day it touched a new high of $73.63. (Update: Final $72.76)

There are very few stocks that I might say are a must own as a core holding. However, unless you think alcoholic beverages are going out of style, Diageo might be one of them. Trading at a 52-week high and surpassing the market last year and so far this year, too, the metrics are starting to look average. But several things do jump off the page on closer inspection. One is the whopping 46% return on equity and the other is the 3.3% dividend yield.

Continue reading Chasing Value: Diageo New High on Full Bar Stools

Chasing Value: Diageo New High on Full Bar Stools originally appeared on BloggingStocks on Tue, 19 Oct 2010 16:00:00 EST. Please see our terms for use of feeds.

Study says sin stocks are a better investment originally appeared on BloggingStocks on Thu, 16 Apr 2009 15:20:00 EST. Please see our terms for use of feeds.

Continue reading Booze Stocks: Drinkers cutting back. Will stocks follow?

Booze Stocks: Drinkers cutting back. Will stocks follow? originally appeared on BloggingStocks on Wed, 25 Feb 2009 10:30:00 EST. Please see our terms for use of feeds.

The traditional definition of sin stocks has been simple: booze, cigs, scantily-clad women, and gamblin'.

But now some traditionally socially responsible companies are backtracking. According to The Wall Street Journal, KLD Research & Analytics, a socially conscious indexing firm, has launched a new Global Sustainability Index (subscription required) that uses a point system of sorts to include or exclude companies based on environmental impact, corporate governance, and the nature of their products. Some companies that sell liquor or operate casinos have made the list. Even Pax World recently dropped its zero-tolerance policy for alcohol and tobacco stocks.

The shift is a result in the shift in the definitions of morality and social responsibility. Originally, many of these funds targeted social conservatives who found gambling and pornography distasteful. The target market now seems to be the environmentally and socially conscious.

Of course, there are different funds for people with different ideologies. There's even a special fund for Democrats! For my profiles of a few off-beat funds investing based on SRI criteria, check out Invest with Your Politics.

What exactly is a sin stock anyway? originally appeared on BloggingStocks on Sat, 06 Oct 2007 18:10:00 EST. Please see our terms for use of feeds.

Saturday's New York Times has an interesting piece on socially responsible investing, and investors who are successfully integrating their values into their investing without sacrificing their returns. While everyone is familiar with standard SRI funds like Paxworld and Parnassus Investments, there are a few really interesting ones that you probably haven't heard of:

Amana Mutual Funds: I'm Jewish, but I'm tempted to convert after taking a look at the jaw-dropping returns achieved by this fund, which screens out stocks that are not consistent with the principles of Islam. For the past 10 years, the Amana Growth Fund has earned an average annual return of 13.13%, compared to 8.42% for the S&P 500. This handily beats the vast majority of mutual funds, earning the company a coveted five-star rating from Morningstar, the leading evaluator of mutual fund performance. So what does Islamic investing mean? Amana won't invest in any company involved with liquor, pornography, gambling, or banks. Why banks? Under Islamic law, the lending or borrowing of money with interest is forbidden. Amana also avoids companies with heavy debt loads because of this. That practice helped the fund get out of Enron stock before the company imploded.

The Vice Fund: This one is the antisocial responsibility fund. They've invested, with tremendous success, in gambling, tobacco, pornography, and guns.

The Ave Maria Catholic Values Fund: This is another very successful fund which invests based on Catholic principles. They don't touch the traditional sin stocks, but also avoid companies that grant marriage benefits to same-sex couples.

So as you can see, values-based investing isn't just about labor practices or the environment. Whatever your values happen to be, there is probably a mutual fund to match them!

The benefits of social responsibility and some unusual funds originally appeared on BloggingStocks on Sat, 17 Mar 2007 16:40:00 EST. Please see our terms for use of feeds.