The Fabulous 5 – Netflix, Chipiotles, Baidu, MercadoLibre and LuLuLemon

The easiest way to get back to blogging is to go back to my roots…stocks and trends. Good or bad I will start blogging more market thoughts for a while to get back in the blogging mode.

The Top 5 stocks in this weekends IBD 100 are Netflix $NFLX (I am long), Chipotles $CMG, Baidu $BIDU , MercadoLibre $MELI (I am long) and Lulu Lemon $LULU.

Sometimes the market just makes sense. If you peel back the layers, these really are the best 5 business models of the last 12-36 months and likely in 3 years still the leaders in their categories (not a stock price predictor unfortunately).

If you owned these fab 5 stocks for the last 12 months you would be a ‘guru’ and a CNBC regular (the downside). If you owned these 5 stocks you would be globally diversified across many different industries – China, Internet, Latin America, Search, Web Video, High End Retail, Fast Casual Restaurant. If you owned a little gold $GLD (I am long) for America’s demise you had/have kickass portfolio with 6 stocks.

If you asked 1000 random stock investors for the stock symbols or business descriptions for these, you would have a funny ‘Man on the Street’ episode for Jay Leno or my old Wallstrip.

Why are these stocks ripping despite high PE’s and a shitty global market environment?

Unfortunately, I don’t have the answer to the power of momentum. Stocks overshoot to the upside and the downside.

As I explained on today’s ‘Momentum Monday’ show , Netflix continues to rock higher because the only argument against it is ‘they can’t win’. It’s too competitive…Apple will compete, Amazon will compete. That’s the same argument Netflix has faced forever. Fact is that Netflix on the iPad is the future. AND, the best hedge against Netflix is not Apple or Amazon, but Coinstar $CSTR.

Lulu Lemon continues to win because they are the ‘Facebook of ladies behinds’. Women love the way they look in LULU. Case closed. LULU is unchallenged by anyone in this growing space and the fact is at 126 stores, this trend is early.

Winners go unnoticed because people are looking for winners on the losers page when in fact the biggest winners come from the winners page.