Two Stock Ideas

Here are two stock ideas from Forbes Magazine:

1. EZCorp (EZPW) - They run 412 EZPawn stores in the U.S. and Mexico, as well as 477 EZLoan payday loan outlets. Its first quarter net income rose 18%.

Most of its stores are in Texas and Oklahoma, but they recently expanded through acquisitions into Colorado, Nevada, and Florida. They can eliminate redundant overhead from these newly purchased stores. They have a strong balance sheet: $42 million in cash and debt of only 7.6% of total capital.


2. Hansen Natural (HANS) - They make a popular brand of caffeine drinks called Monster. The stock rose from a split-adjusted 50 cents in 2003 to $68 in 2007. It went down to around $25 last October, but is now at $35 after signing a distribution deal with Coca Cola to sell its drinks in 20 U.S. states, Canada, and 6 European countries.

In December, they signed a deal with Grupo Jumex to distribute Monster drinks in Mexico. An analyst with UBS thinks they can capture $100 million in sales from these new markets by next year.

Later this year, they plan to enter Australia, New Zealand, and South America with distribution partner Anheuser-Busch InBev.

Monster's main competition is Red Bull. In Europe, Red Bull dominates the caffeine-rich market. In the U.S., Monster's market share went from 6.5% (in 2004) to 29.6% today, while Red Bull fell from 49.1% to 26.5%

Hansen trades for 20 times expected 2008 earnings and has almost no debt.