Traumaktien von David &

David's No. 1 Dream Stock: Netflix

Before Netflix (Nasdaq: NFLX), everybody essentially rented movies the same way: You trudged out to the local store, waited in line, plunked down your card, and trudged home. Then you did it all again in reverse -- hopefully on or before the due date.

Netflix changed all that. Netflix was the first to offer rentals online and to deliver them by mail. Netflix also was the first to eliminate due dates. As a result, Netflix is far and away the dominant player in this new market niche it essentially created.

As you can see, this is just the type of Rule Breaker David is famous for digging up way ahead of the Wall Street crowd.

But where to from here?

Netflix is up 196% from its recent low of $9.43 back on November 1, 2004. But the company is hitting on all cylinders.

Any threat from Amazon.com appears far less imminent, and if competition from Blockbuster continues to wane, Netflix just may be able to increase its fees and become even more profitable.

So far, just about 3% of U.S. households are Netflix subscribers. That's impressive, but leaves plenty of room for this classic Rule Breaker to grow.

I wish you could have been a subscriber back when David first recommended Netflix in June 2003. That way, when David advised you to sell in November 2003, you could have locked in a 159% gain.

Tom's No. 1 Dream Stock: CDW

In 1984, a young fellow sold a computer in the Chicago Tribune classifieds. Twenty-one years later, his company makes $6 billion a year distributing products from Microsoft, Apple, Hewlett-Packard, Sony, IBM, and Cisco.

The company, now called CDW (Nasdaq: CDWC), closed out 2004 with around $250 million in owner earnings. The balance sheet sparkles, with over $600 million in cash, no debt, and very rapid turns of inventory.

Has Tom found his next triple?

Tom loves the fact that rates of return on equity, assets, and invested capital are astonishing. To hear it from Tom, this is simply a beautifully run business, yet it's selling today for less than 1 times sales.

As importantly, that same "young" fellow still owns 20% of the business. Think in terms of Gates at Microsoft, Walton at Wal-Mart, or Dell at Dell. Tom expects CDW and founder Michael Krasny to be added to that elite list over the next 10 to 20 years.

Where to from here?

In time, the entire world will need a first-class technology reseller. Tom sees no one positioned as well as this great company to fill that need. That's why you can look for overseas expansion to drive growth for years to come.

Meanwhile, management is buying back shares by the boatload. No wonder this is a core Stock Advisor holding. And no wonder Tom expects the stock to double or even triple in value over the next five years.

Best of all, this is a recent recommendation and is up just 7% since Tom first discovered it. Find out how you can profit from Tom's "next" double or triple when you join Stock Advisor today.