Stock Ideas for Young Investors
If the $700 a share price on Apple looks daunting, there are plenty of other great stocks out there for building a portfolio in the $10 to $30 range.
“I’m always about buying the best companies,” Howard Lindzon, CEO of StockTwits, told CNBC. “If you can afford two or three shares of Google or Apple, that’s what you should do.”
But there happen to be a lot of great companies that have much lower share prices, he added. “Right now, in software and the toy business there are great ideas out there,” Lindzon said. (Read More: What If Batman and Spiderman Were Stocks?).
He likes LeapFrog in toys, and Cornerstone OnDemandand Aspen Technologiesin software. “LeapFrog, Hasbro, and Mattel are companies that are going to benefit as Apple continues to dominate with the tablet and toys move beyond the iPad,” Lindzon said. LeapFrog makes educational entertainment products for children.
Cornerstone and Aspen are both enterprise, cloud-based (learn more) software companies that are “undiscovered, unloved recent IPOs,” Lindzon said.
Robert Luna, SureVest Capital Management’s chief investment officer, said young investors should focus on dividends.
“Young investors should realize that 90 percent of returns come from dividends and dividend growth,” Luna said. “They should focus first and foremost on high-quality dividend paying stocks.”
Luna recommends automaker BMW which is sporting a 2.6 percent dividend yield.
—By CNBC.com’s Justin Menza
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Howard Lindzon owns shares of LeapFrog, Cornerstone OnDemand, and Aspen Technology.