I have always made stock picks based on companies that I think are going to outperform on expectations-I know this seems obvious, but basically companies that will surprise on product development and user growth/adoption. Its hard for me to fully grasp how hidden financial metrics move stocks beyond positive earnings. That being said, here are three companies I like looking at it from a Buffet-like long term perspective (I know some are trading of very high multiples):
LinkedIn ($LNKD): just noticed recently that a lot of very talented/smart people are going to work for Linkedin. Tells me two things: 1) they are paying well for talent 2) the company will continue to be run and managed well and only be more successful. Also, love how diversified their revenue is. Also, their addressable market includes anyone between 18-65 years old who has any professional aspirations. They have a huge blank canvas for mobile and international. Finally, have you noticed recently a huge uptick in Linkedin Invitation requests from people you would have never thought would be on Linkedin?
Netflix ($NFLX): More tablets, more phones, more connectivity=more Netflix. Also, with House of Cards and some of the other original content they are creating, they are no longer beholden to the big studio/media content creators. If anything, it increases their negotiating power because they dont need the big content creators any more. If the price is right for the content, they will pay for it, but if its not, they dont need it. This trend will ultimately drive down the price/cost of the license of the content from the large studios improving their margins.
XPO Logistics ($XPO): My buddy sold me on this one. Next generation logistics provider on freight transportation. Solid management team with a huge forward momentum working for them-people will rely more and more on shipping as e-commerce continues to grow. Delivery becomes more and more important every day.