America's electric utilities are about to sink a small fortune into a desperately-needed upgrade of the nation's power grid. How can an investor plug his portfolio into this upgrade? JPMorgan's Andrew Smith has some ideas.

Recommendations:

"The one pure-play transmission company is ITC Holdings," he told CNBC. "They own nothing but transmission lines, own, operate, and build them, and also stand to benefit very well from that. The Energy Policy Act of 2005 put together a number of incentives for transmission investment...that allow a company like ITC to benefit very significantly."

Recent retreats in oil prices have had no impact on Eitan Bernstein's strategy of investing in oil company stocks.

"Our investment strategy is focused on selectivity, basically, understanding the volatility in commodity prices," he told CNBC. "We try to focus on the best names in the group."

Recommendations:

And they would be Hess and Occidental Petroleum.

"The stocks are...pretty much flat year-to-date, down a little bit the past couple of weeks, despite the 33 percent increase in crude oil prices, year-to-date," he said.

Why?

"For the bigger, integrated oils, it's a question of growth," he explained. "One of the reasons we like Hess is (that) they have substantial production growth slated, and a really good inventory of exploration and production projects."

Bernstein also likes the smaller refiner Holly.

Can this be? David Sowerby's top stock pick is a homebuilder?

The chief market analyst at Loomis Sayles says it's a matter of quality -- and he's also carefully selected a couple of tech companies that he believes deserve some investor dollars.

Recommendations:

The homebuilder is Pulte Homes.

"Pulte is the best quality play in the homebuilder area," Sowerby told CNBC. "They finally beat numbers after having missed numbers for three or four quarters previously. That's positive."

Don't sell now!

The worst time to sell into the equity markets is when risk appetite is low, says Khiem Do, head of Asian multi-asset strategy at Baring Asset Management.

He offered CNBC his investment advice.

Disclaimer

What's moving in the options market? BJ's Wholesale Club, Wells Fargo, and Coal, according to Rebecca Darst of Interactive Brokers.

On BJ's ...

"Whenever the market sees a sympathy play in a stock -- a stock is moving by dint of something that happened in another stock in the same sector -- that provides a good opportunity for people who follow options to see whether the volatility in that stock may be overpriced or underpriced relative to what it should be, so it's with that in mind that we looked at the option in BJ's Wholesale Club , where implied volatility rose 12 percent yesterday to 51.5 percent, ranked among our top 50 implied-volatility gainers yesterday," she said Thursday morning on CNBC's "Squawk Box ." "We saw options trading at five times the normal level. It looked like most of the options action yesterday took place at that August 35 line that was both the call and put line. If you trade those together, that's the straddle." (For her full comments, see video)

Michael Corbett, portfolio manager at Perritt Micro Cap Opportunities Fund, said investors can seize opportunity in high oil prices -- with micro cap energy companies.

Corbett explained that micro-cap companies are companies that "separate the top 80 percent from the bottom 20 percent, in terms of market capital."

Recommendations:

Mitcham Industries – "They’re getting a big benefit from the high energy prices; another part of the benefit is that the weaker dollar is helping them. Over 70 percent of their business is coming from overseas. This company is growing."

AM Castle – "This company is helping out big companies like Boeing. They’re also benefiting from the weaker dollar."

Once it was art. Once it was cool. Now, it's just an ugly mess. Tattoo removal is a growing trend -- and Formula Capital's James Altucher says it's a trend investors should watch.

"On a daily basis, you see people worried about Apple's earnings, Google's earnings, oil, subprime, but...you have to invest in trends that are never going away," he told CNBC. "Tens of millions (of baby boomers) have tattoos...maybe 100 percent of them regret it; it's going to be a booming industry."

Recommendations:

So how does this translate into shrewd additions to a portfolio?

"Every tattoo is made by thousands of pinpricks with pigment inserted into your skin," he explained. "Lasers go in...and remove all the pigment...there's a few companies that specialize in the lasers that do this tattoo removal."

Topping his list is Cynosure,

"I consider this the Google of tattoo removal," he said. "The company has $60 million in cash, no debt, they trade for just eight times cash flow, and they're growing at 40 percent a year."

There's also Palomar.

"They have a $215 million market cap, $115 million cash in the bank, no debt," he said. "You have Cutera, with $90 million cash in the bank, no debt, and only $130 million market cap."

Altucher says they are bargains -- and they promise to be around for a long time.

"The entire market has driven these stocks down, and yet it's a tidal-wave trend," he said.

Maybe Wall Street really is drunk. Somehow the Biblical parable ''the last shall be first and the first shall be last" is shaping up to be the dominant theme this earnings season -- at least in terms of performance.

In the past two weeks, the Financial and Discretionary sectors have dominated the market, gaining 18 percent and 8 percent respectively, versus only 3 percent gain for the S&P 500. Interestingly, these same two sectors are forecast to post the worst earnings results this quarter with consensus looking for a 75 percent and 20 percent drop in profits.

But wait -- it gets better: There's another half to this story and wouldn't ya know it? The first are indeed last!

Energy profits are forecast to rise a market-topping 28 percent this quarter, and yet in the past two weeks of the earnings season, they've found themselves in performance purgatory with a 6.6 percent decline.

Perhaps the proud have finally been humbled?

_____________________________________________
Energy Sector:

- Dow Oil & Gas Index

- Exxon Mobil

- Chevron

- ConocoPhillips

Financials:

- JP Morgan Chase

- Lehman Bros.

- Citigroup

_____________________________________________

Disclaimer

Michael Jones runs the five-star Touchstone Value Opportunities Fund, up an average of 12.56 percent per year over the last five years.

What's his "Triple-A" strategy?

Recommendations:

Topping his list is Alcoa.

"Alcoa's done a great job of positioning (itself) for the current environment of energy costs going up," he told CNBC.

He sees Alcoa's main product -- aluminum -- being substituted for other metals as manufacturers seek to control costs. And he notes that Alcoa plants have been situated near renewable energy sources.

Jones also likes ABB.

"They're probably the most well-positioned provider of (electrical) transmission equipment," he said. "Number one in North America, number one in Asia, number two in Europe."

Rounding out his "A" list is bond insurer Assured Guaranty, which recently raised eyebrows as Moody's Investors Service said it is considering a downgrade of as many as two notches, and JPMorgan downgraded it to neutral from overweight.

"We think (it) is in pretty good shape," he said. "They've increased their market share in the municipal bond-underwriting business by a dramatic amount this year; their underwriting is up 15-fold, year-to-date, over last year; we think they have adequate capital."

Brent Wilsey has a prescription for investors: Specialty health-care names.

The president of Wilsey Asset Management thinks that the downdrafts that have slammed stock prices in the sector are now behind it, and it's time to buy into the companies' recovery.

Recommendations:

Topping is list is Chemed.

"This company has moved quite a bit," he said. "The 52-week high is $69 a share; it's...now around $42...the forward P/E is still under 12...their earnings are up 11 percent year-over-year."

Wilsey also points out that nearly a third of the company's earnings come from an unexpected subsidiary: Roto-Rooter.

He also likes Coventry Health Care.

"The stock has kind of struggled over the past year," he said. "But the company's doing a great job! Their sales are up 32 percent year-over-year; return on equity is 20 percent...great company, great fundamentals, good time to buy it."

Also on his list, UnitedHealth Group, which posted a sharp drop in second-quarter profit this week.

"Their earnings don't look as good because of special one-time items, but if you take those out...you'll see that their earnings were 67 cents per share," he pointed out. "Going forward, the next 12 to 18 months, you'll see good things from this company."

Rounding out his selections are Humana and WellCare Health Plans.