Here are the next four of my 2011 picks. I am behind schedule, after publishing the first 5 earlier in the week (see: Chasing Value: 2011 Stock Picks -- 5 of 11). This year instead of starting completely anew, I am adjusting my 2010 picks. There is no sense in abandoning good ideas just because the calendar turned a page.

You will actually find support of running themes I have been writing about over the past few months. One of these is the idea of making a contrarian investment in a basket of stocks that have been both scalded and scolded in the headlines. Six stocks were included in such a group that I called the "toxic stocks" (see: Chasing Value: Toxic Stock Update #3 -- BAC, BP, C, GE, GS, RIG).

This is the fifth year that I am posting my stock picks for the year. There is a lot of foolishness in doing so because each year that I have made such suggestions, including 2009 when I owned all of the picks, it is assumed that I would hold all of the positions without responding to market conditions, or changes in the specific company. No adding to, or cutting a position. This is not the real world.

It is not possible for everything to remain static. For example, you might find that you hold a stock that made a great run through three quarters, beyond your wildest expectations, and decide it has passed a point where the metrics cannot support anything close to the price. Under normal circumstances you might sell it, except you cannot. By the end of the year the profit you might have realized fades away and you end up reporting on something that is not a true measure of your objective strategy. Nevertheless, once again I will stick with this approach because this seems to be how its done in every publication's annual picks. This year there are eleven.

The year 2010 has come and gone and my results are in. This is my fourth annual stock results to be reported on BlogginStocks, so something of a track record is starting to form. This past year ended with a modest improvement over the unmanaged Standard & Poors 500 index

The original story, Chasing Value: 10 Stock Picks for 2010, took readers through a review of many candidates, concluding with the ten picks, using prices from Dec. 28, 2009.

Analyst Upgrades

• Citigroup assumed coverage of Illinois Tool Works (ITW) and upgraded shares to buy from hold with a $52 price target. Citi cites valuation and the company's successful execution for the rating change.
• UBS upgraded Rowan Companies (RDC) to buy from neutral based on better-than-expected dayrates in the high specification jack-up market. The firm raised its price target to $42 from $28.
• UBS also upgraded NetLogic (NETL) to buy from neutral and keeps a $33.50 target on the stock. The firm upgraded shares based on valuation and solid long-term outlook.
• AvalonBay (AVB) and BRE Properties (BRE) were upgraded to neutral from underperform at Macquarie.
• Covance (CVD) was upgraded to equal weight from underweight at Morgan Stanley.
• Reynolds American (RAI) was upgraded to neutral from underperform at BofA/Merrill.

The first quarter of 2010 is closed and the results are in. My picks surpassed the primary indices by a large margin. The original story, Chasing Value: 10 Stock Picks for 2010 , was the culmination of a process presented to our readers and finally narrowed down to the select group using final prices from Monday, December 28, 2009.

For comparison I tracked the Standard & Poor's 500 Index, the Dow Jones Industrial Average, and the NASDAQ. Each of these produced positive results for the quarter.

During my tenure at BloggingStocks I have expressed my opinion often about the contribution that dividends make to your overall return. Most shrewd investors, and especially "my pal Warren," know this and understand why I re-emphasize the point when I make my annual selections.

By now I hope you have had a chance to peruse my picks for 2010. If not the links below will give you another opportunity.

The Olympics are coming! The Olympics are coming to Brasil Telecom (BTM) -- well actually to Rio de Janeiro, where BTM is headquartered, in the summer of 2016.

This company came to my attention while screening mid-caps for yield, currently a healthy 7.81% (not distributed quarterly) and a very low price-to-sales ratio of 0.52. This first glance was followed by more scrutiny with an interest in Brazilian companies for potential growth and diversification.

To arrive at this years ten picks I scoured business journals and editorials, online and off. I also ran through a series of stock screens repeatedly over the last few months filtering for five primary value metrics identifying stocks worthy of further consideration.

The 5 data points were price-to-sales (P/S), price-to-book (P/B), price-to-cash flow (P/CF), dividend yield and return-on-equity (ROE). I did look at other things but these were the subject of my initial focus.

Is it time to take a bite out of Apple, Inc (AAPL) or leave it on the vine? After reviewing the current list by examining the stock yields and price-to-cash flow (P/CF) we will take a look at Apple for 2010.

Yesterday I dropped two stocks, but the list is still too long. In the coming weeks there will be more cuts and if I find anything of more value perhaps there will be something new.

Today it's time to do some trimming of the fourteen stocks and four options on the contenders list. This review will prioritize the companies by price-to-book (P/B), price-to-sales (P/S) and return-on-equity (ROE). This does not preclude more possible stocks being added and the final list will not be done until the end of the month.

We will also compare recent stock prices to three-year highs to give us a relative idea where the stock floated in rosier times.

Only three weeks to go before the list of contenders are finalized into my ten picks for 2010. There were 14 before I added three more today and moved one of the stocks on the fence up, leaving another three still on the fence.

I continue to read everything I can get my hands on and recommend doing the same to anyone else seeking to do some stock picking. A lot of the recommendations I come across project possible appreciation of 10% to 15%, and that would be great, but I am seeking at least the potential to double that.

MAJOR PAPERS:

• The IRS is looking at derivatives trades of Citigroup Inc (NYSE: C) and Lehman Brothers Holdings (NYSE: LEH) to see if trades made on behalf of hedge funds and other clients, including those offshore, were to avoid paying taxes on U.S. stock dividends, reported the Wall Street Journal (subscription required).
  
• The Financial Times (subscription required) reported that Telecom Italia (NYSE: TI) is expected to sell its stake in Brasil Telecom (NYSE: BTM).

OTHER PAPERS:

• The New York Times reported that Ford Motor Company (NYSE: F) is expected to receive opening bids today for its Jaguar and Land Rover units. A variety of companies, including private equity firms and possibly other automakers, are expected to bid for the two divisions, said people with direct knowledge of the situation.
• Retail shoe store chain Foot Locker Inc (NYSE: FL) is reportedly considering putting itself up for sale again, after disappointing sales by its U.S. shoe stores and its failed attempt to acquire rival Genesco Inc (NYSE: GCO), reported the New York Post.
• The Telegraph reported that Wal-Mart Stores Inc (NYSE: WMT) is examining a deal to invest in Beijing Hualian, one of China's biggest retail groups.