We get the same general list of questions when talking to just about everyone regarding Estimize, and the fear that someone could (try to) use it to move assets in their favor is definitely one of them. We’ve thought this through from the very beginning, and the community definitely deserves a window into our thought process as the platform grows and more people rely upon its data and analysis.

Let’s consider the first scenario, where a nefarious user attempts to publish a very low estimate in order to push the consensus number down in order that his stock beats the number.

First, we limit the ability to make estimates right off the bat to a certain range based on an algorithm which looks at previous accuracy from Wall Street and the Estimize community. This algorithm isn’t very complex, but it generally does the job and will get better over time.

Second, we have a flagging system which looks at how estimates are made and by who, think of it as an estimate reliability score. The score takes into account many different factors (which we won’t divulge), and produces a flag if it’s too low.

And third, we manually review the data being produced on the platform, just as we did in the early days at StockTwits in order to build a clean community.

This system is still a work in progress, but let’s say that after all of that, the user’s estimate sticks and he is able to bring down the consensus. If you’re trading off of data produced on the Estimize platform, you’re most likely going to be taking a look at some of the individual estimates that make up that consensus before hand, and when you see an outlier, you’re going to ask yourself the question, who is that person.

And when you visit their profile you’re going to see one of two things. Either, this was their first estimate, they have no track record of accuracy, and have not filled out their profile, in which case you shouldn’t trust their estimate as a legitimate outlier. Or, they have a history, have filled out their profile, and this is the first time they’ve made a wildly outlier estimate. But wait, let’s think about this, why would someone who has taken the time to build their track record on the platform throw that away to put one estimate in to influence a consensus number? Doesn’t make much logical sense. We’re not concerned with this taking place, the incentive structure is stacked against this type of behavior.

Much of the reason that pumping or dumping stocks on Estimize doesn’t work is due to the fact that you need credibility in order to make this happen. A consensus number produced by 10 guys who have no track record on the platform is not equal in reliability to an estimate produced by 3 guys with big track records of high accuracy. The community is smart enough to discern between the two.

The market is not going to listen to the Estimize community as a whole, or any one community member, on an asset which they have been very wrong on in the past. So your only real option is to build your accuracy and reliability score, then throw it away on one stupid estimate.

Now, if you really want to know how to pump stocks on the Estimize, here’s my thought. After you’ve been around for 3-4 reporting periods for the same stock and have scored highly on each release, higher than the Wall Street consensus for each and within the top 3 Estimize community members for each release, think about this.

Get in touch with the other 2 or 3 guys who have been very accurate on that stock and collude to bring the estimate down.

Oh wait, that’s what Wall Street does now.

Estimize

Estimize has been recognized as the whisper number of record by several different financial sites, we’ve been profiled in major financial publications, and have gained endorsements from many of the most respected members of the social finance community.

The buy side is also paying major attention already, as quant desks from several major hedge funds have asked for access to the Estimize data set on a non latent basis to use in their models. This has taken place several months before we had expected, speaking to the value of data being produced.

I’d like to share a few statistics from the platform so far. We now have 2,800 registered community members, over 1,350 estimates made by over 350 community members. Every major investment bank and over 180 large buy side firms are on the platform consuming data on a regular basis.

But we’re just getting started, the platform has only been open to the public for a month and a half, and until now required a sign up. Today, we’ve opened up the platform in order that you’re able to browse through any page without signing up. You’re now free to link to your profile pages, accuracy tab, any stock page (AAPL), and the calendar. You will still need a log in to make estimates and follow your favorite community members and stocks in the tracked tab of your dashboard.

We’re also in the process of building Estimize Premium, a set of features which will greatly enhance the power of data and analysis shared on the platform. In a number of weeks,  visitors to the platform will be given the option to contribute a certain amount of data and analysis on a monthly basis, or pay for the right to view data produced by everyone else. We believe strongly that this will both increase the value of contributing to the community through access to new features, and provide everyone with a richer data set. Unlike the current Wall Street estimate data set, we believe data and analysis produced by this community should always be open to those who participate in it.

We want to say thank you to those community members who have contributed data to the platform at such an early stage, so we will be grandfathering in those who have made more than 10 estimates. We’ll also be grandfathering in those who reach that threshold within the next few weeks during this earnings season.

Beyond that, we’re looking forward to being able to grow our development team so that we can provide the community with a richer experience and more tools. If you weren’t aware, we’re a team of 3 right now including myself (and god knows I can’t code), pretty amazing.

Look soon as well for the addition of new assets including recent high profile IPOs and economic releases, along with continued improvement in how the site operates in general.

And thank you again for sharing our vision with us in creating an open platform of fundamental estimate data and analysis more representative of what the market actually expects.

Estimize

For the most part, community estimates are clustered between 9.5 – 11.0 EPS and 37 – 40B in Revs. We do see some major outliers though from trusted community members we’ve spoken with. A few estimates fall above 45B in Revenue and above 11.5 EPS.

Once again the Estimize community is expecting Apple to report above the Wall Street consensus. Earnings per share consensus for Wall Street comes in at 9.82 while Estimize falls at 10.28. Revenue consensus for Wall Street comes in at 38.15B with Estimize at 38.87B. Both the Estimize community and Wall Street missed the dip in Apple numbers last quarter and expect the company to more than make up the difference as consumers bought up the iPhone 4s at a breakneck pace.

As for the analysis, most are bullish on iPhone 4s sales as well as holiday iPad 2 sales. A few community members mentioned big beats and guidance raises by some Apple suppliers, signaling that revenue growth will continue to be strong.

On the low end, there are worries about consumers waiting for iPhone 5 and iPad 3, as well as competition from the cheaper Amazon Kindle Fire tablet. Aris David, the most accurate community member last quarter who called the big miss also notes that a stronger US Dollar may impact overseas sales which are an increasing part of Apple’s revenue mix. There are also some fears of higher costs in supply chain transportation eating into earnings.

We’ll find out on the 24th who called it best and how the market handles the report. If you haven’t yet made your estimate, hop over to Estimize and punch it in now.

But that’s life, and if I’ve learned anything over the past six months, it’s that no one else has a damn clue what they are doing either, except for Steve Jobs, he was the last one who did. Everyone else is making assumptions, testing them, and in between trying their hardest to get everyone else to believe in their assumptions and not call bullshit on the fact that they themselves don’t really have a clue either.

That’s why you should never be intimidated by anyone, underneath they are just as clueless as you, in different ways yes, but just as clueless.

Internalizing the fact that you really don’t have a damn clue can do one of two things. It can crush you, or set you free to make mistakes, fail, fail again, and then succeed. It’s all about how you handle that truth, do you embrace it, or ignore it.

Having a set of core beliefs is not something you can fake, and it’s not something you should ever be in doubt about. Doubt the details, build, measure, and learn, but don’t ever waiver on your core vision and beliefs.

Your core vision should be represented by a straight line that goes from the lower left to the upper right of a chart. The x axis representing time, and the y axis representing success. Keep your eyes focused straight ahead on that line at all times. The values on that line are represented by your goals along the way. Set tough goals, then go crush them.

But know that as an entrepreneur doing innovative things in a stressful environment, not many days are going to fall right on that line. Most days are going to feel like you’re either way above or way below, elation and depression, every week is a roller coaster. I’ve been through two whole cycles in just two weeks, where I’ve been high as a kite, and low as death valley.

One amazing thing that trading taught me is how to read my own emotions, and take my own pulse. When I had minimal exposure to the market and it was running away from me, I would eventually feel this really sick feeling in the pit of my stomach, the feeling of being left out, it’s a very powerful emotion. And just when I started to feel that fear, the market would pull back as it should and let me in. I knew how to read myself so well, and not get caught buying up for the sake of getting in. As a momentum trader, that was tough to learn.

I’m just starting to learn how to read myself when it comes to executing on this vision. Understanding how far above or below that line I really am, and when I’ve hit the top or bottom of those cycles. It’s the ebb and flow, and while you need to keep your eyes fixated on that line, you need your heart in the flow. You need to feel elated and crushed, all in the same week, and know that if you’re doing the right things you’ll always mean revert back to that line.

But in the end, it’s the farthest point in the very upper right hand corner of that graph that you need to keep your eye on, and to know all of the points on the line that get you there.

Earnings season will start heating up as early as next week, January 9-13. On Monday, Alcoa ($AA) will release its fourth quarter earnings. It was a rough 2011 for Alcoa, seeing its share price drop by a whopping 44% and referred to as one of the “doggiest dogs.” For FQ4 2011, Wall Street analysts have estimated that EPS will be $0.04 and revenue will be $5.9 billion.

Looking back as far as the fourth quarter of 2009, Wall Street has often been high or low on Alcoa, but rarely accurate. For revenue, Wall Street has been more bearish on the stock, and for the past two quarters has estimated well beneath the actual. The Estimize, and general social finance community, seems to be far more bearish on the stock. On December 29th, the stock hit its 52 week low; as a global supplier of aluminum, Alcoa is largely dependent on the vibrancy of the transportation industry and the global economy. With slowdown in the auto, aircraft, and construction industries, Alcoa took a hit.

Lennar Corporation ($LEN) reports its fourth quarter 2011 earnings on Wednesday, January 11th. The stock has been steadily climbing with minor pullbacks since October, with share prices rising from just over $12 to just under $20. Since the burst of the housing bubble, the stock has remained relatively stagnant within this range. LEN took a massive hit in 2008 when housing prices fell due to inflated prices and excess supply. However, sentiment in the housing sector seems to be improving slightly in 2012, mainly in the South, whereas the West saw a lot of overbuilding during the bubble. LEN also expanded into the Pacific Northwest in late 2011. A lot is still in question about the housing market, and uncertainty still plagues the industry. Homebuyers are skeptical that their homes will retain value and are still remaining on the sidelines.

Looking at the charts, Wall Street analysts have traditionally been underweight on LEN for both EPS and revenue. Wall Street is predicting a strong quarter for LEN, and seems to have confidence in the stock and the housing market at large. I am predicting a slight beat in EPS and a slight miss on revenues, as per the chart.

Now, for everyone’s favorite financial: JP Morgan Chase ($JPM), which release its fourth quarter 2011 earnings on Friday, January 13th. It’s been a bad couple of years for financials, namely $C $MS and $BAC. At times JPM seems to be the rare exception; as of January 3rd, JPM is up close to 5% on the year. Recently, JPM has been doused in even more bad press for mortgage fraud. However, at this point these headlines are becoming “the usual” and the stock seems to be intact, and remains one of the top dividend paying Dow stocks.

JPM has consistently beat Wall Street earnings predictions every quarter since the end of 2009. Analysts are predicting earnings of $0.95 EPS and revenues of $23.59 billion. In both EPS and revenue, The Estimize community as well as the social finance community at large seem more bullish on the stock, and are predicting a beat, once again.

To see estimates for upcoming earnings releases or share your own, you can click on any of the charts or HERE.

This is a guest post by Michael Knopf who works on community at Estimize.

I spend a lot of time down in Union Square (NYC). It has become the center of gravity for just about everything I do, from work, to the gym, restaurants, and simply getting around the city. For those of you who don’t know your NYC history, Union Square was one of the worst neighborhoods back in the 70′s, the park was full of druggies, and everything surrounding the park was porn shop or porn theater.

Today, at the center of Union Square sits a Whole Foods, flanked by no less than three Starbucks shops around the park. Union Square has become the center of the real NYC, unlike Times Square which everyone judiciously attempts to avoid on a daily basis.

I’ve watched as Whole Foods has become the rally point, pit stop, and melting pot of Union Square, and for myself. And I can tell you this, Whole Foods is about to break through and become the next Starbucks. It is about to move from being an organic grocery store, to a cultural icon.

Let’s take a look at a few charts.

Whole Foods (WFM) trades at a P/E right around 36, which compared to the multiples it was fetching at the same price back in 2005 is relatively cheap. In other words, WFM is trading at half the P/E multiple it was in 2005, even while it is growing earnings at a faster pace than it was during the 2005 run.

When we look at the sales multiple we see the same story, the stock is trading at half the 2005 multiple while the company is growing sales at 2/3 the pace while sales have doubled.

Is Whole Foods a “cheap stock”? No, it’s a growth stock which deserves a rich multiple, and I believe that multiple is about to get even richer as the market realizes the company is far more than just a high growth grocery store.

The play on Whole Foods’ business centers around prepared food. At least 2 nights a week I make a stop at Whole Foods to grab dinner. When I walk in there at 7PM it’s a mad house. The place is packed with students, professionals, and tourists alike. I grab something from the buffet, or the hot meats section and head upstairs with my laptop to continue working through dinner. I see so many people doing the same.

While Starbucks is the place where people go to hang out and drink coffee casually with their friends, or sit and do work throughout the day, I’m seeing Whole Foods transform into the rally point for people looking to grab food with friends or colleagues before continuing on with their evening. It has become far more than just a buffet, people just hang out there now. And that’s a powerful thing for the Whole Foods business because it creates a bond between what they are selling and an experience.

And while the experience of fighting a million people to get my dinner could be better, I love the food, it’s healthy and hearty, and I love sitting upstairs amongst all of those people in that communal eating setting. I love holding meetings there with colleagues over a quick dinner.

Whole Foods has the opportunity to become not only America’s organic grocery store, but the center of ever major city and town. The Starbucks DNA is coffee, and to some extent other items that fit within a coffee house. But Whole Foods possesses the DNA for so much more. And unlike anyone else, they’ve been able to offer a really amazing prepared food product at not so exorbitant prices. Would you rather go to Whole Foods or Penera Bread? Hands down Whole Foods.

The stock is about to eclipse its all time high set back in 2005, wiping out the last of losses from the 2008 financial meltdown when ever growth stock was taken to the cleaners.

The volume profile on the weekly chart looks very positive as the stock is chewing away at the all time high resistance level. I believe we’re going to see a major beat from WFM during this round of earnings resulting in a high volume breakout for the stock, which should also begin the process of multiple expansion as domestic spending fears take a back seat to the secular growth story taking place at Whole Foods.

At a conservative 15% revenue growth rate for the next four quarters here are my earnings and revenue estimates compared to the Wall Street estimate. You can head over to Estimize to see estimates from the community for other stocks as well, or make your own.

If the company executes on the opportunity they have in front of them, I believe I’m going to have to revise the estimates upwards and multiple expansion may be even greater than I expect.

Look for WFM to trade north of $90 by the time it reports FQ4 2012 earnings.

Below are my favorite posts from this year with a short introduction to each. You can always find all of my favorite posts on the Best Of tab.

Is The Market Fundamentally Broken? (12/17/11) – Both a philosophical and realistic look at some of the bigger problems facing the financial system today.

Estimize Goes Public To Claim The Whisper Number (12/6/11) – A big day in my life, the start of what we believe will be an innovative and game changing platform.

A Message To My Generation (11/7/11) – This blog’s most popular post of the year and my plea to my generation to look at the world with entrepreneurial eyes and stop sulking about the lies that were told to us and the things taken away.

Destruction Leads To A Very Rough Road, But It Also Breeds Creation (9/29/11) – As the pace of innovation quickens, our government is finding it harder and harder to let old industries die in order for new ones to rise, and this could become a huge problem.

If Software Eats The World, You Better Be The Hand That Feeds It (8/24/11) – As software consumes industry after industry, if you want to ad value to this economy in the future you’d better know how to code.

The Social Capital Scoring System (8/13/11) – We’re going to need a social capital scoring system for the collaborative consumption and production economies to flourish.

The Mispricing Of Disruption Risk (7/28/11) – How many different companies, or whole industries were disrupted this year? How early was the possibility of massive disruption priced into their stocks?

The Coming Tech Crash (7/24/11) – Why companies staying private longer will eventually lead to disaster for many public market investors.

The Cure For High Prices Is, High Prices (6/8/11) – A look at why the economics of collaborative consumption are going to completely change our economy.

Bin Laden Won, But He Really Lost (5/2/11) – Why Bin Laden really failed.

Facebook Is Becoming The Internet For Idiots (4/25/11) – Facebook has become the internet for idiots, enough said.

Why I Don’t Believe In Marriage (3/29/11) – Pretty self explanatory.

Facebook Is Worth 100 Billion (2/15/11) – Before I was neutral/bearish on Facebook at 100 billion, I was very bullish at 50 billion.

The Lion And The Gazelle (2/5/11) – My early Tom Friedman type look at the arab spring.

Social Capital and Collaborative Consumption (1/13/11) – Probably the most important post of the year for me, collaborative consumption is completely changing our entire economy and way of life.

Leigh,

First off, thank you for all the informative and entertaining shares on the social networks. By far, you provide the most read-worthy posts, many I often end up forwarding to others.

Good luck with Estimize and I hope that 2012 brings you more prosperity.

(name redacted)

I want to say thank you to everyone who has made me part of this community, and who finds value in what I share. As I’ve always said, I get far more out of it than any of you ever will.

There’s something else I want to share before this year is over, and it may resonate most with those of you who are traders. As a child, I would ask my father if he liked being a real estate attorney. Most times he remark that the work itself was rather boring and he spent most of his day “trying to stop people from doing stupid shit”. But he always made sure to drive home the point that he loved his work because it allowed him to leave his mark on the world. Because at the end of the day, he would often have a serious impact on seeing a huge building erected, one that would most likely stand for the next half a century or more.

He believes strongly that we should all leave our mark on this world, in whatever way we can, a lasting mark, for people to remember us by. Some see this as having a positive effect on just one person we love very much, or a small group of people, others want to be recognized more widely for contributing something.

While I realized years ago that trading financial assets contributes little if anything to the world, and definitely doesn’t leave a positive mark on it, only this year did I really understand my father’s desire to build something of value for other people. I love trading, I love the challenge and the competition, with the market and myself, and some day I’ll go back to finding inefficiencies in the market to exploit in order to make that 15%+ absolute return each year.

But right now I’m focused on building something that will provide value to others, something that will be bigger than just me.

I wish you all the same pleasure in striving towards this goal, and a very happy new year.

I gave back as well. My participation in the collaborative consumption ecosystem was a great benefit to more than two dozen cash strapped travelers. I spent a good share of social capital myself making introductions for others, though I always wish I could do more. I shared what knowledge and experience I have the best I could with those who reached out to me for advice. I gave to charity or the less fortunate in several different ways.

But the one way I wish I could have given back more, is in sharing ideas around the market. My participation in the stream and on this blog as it concerns specific trades and investments is a fraction of what it was the previous two years. I’m not sure how often people say that they’ve had to “sacrifice” giving something back, as in, I feel like I’m losing something myself by not being able to do so. And that’s how I know I love sharing this type of information, because it feels like I’m sacrificing something when I’m not able to do it. It feels like I’m losing something, not the other way around.

Giving feels good, especially when you enjoy doing it.

I hope to be able to give more in 2012, especially in this regard. I hope to build back up some of that social capital I spent this year, through sharing on this blog, my stream, and providing the community with a great platform in Estimize.

So to kick it off, here are my 10 favorite stocks heading into 2012. This is not a list of holdings for the full year, nor should it be seen as a holistic portfolio. I have a great deal of conviction in some of these stocks longer term, and some not as much. If you’re interested in the strategy that I use to select positions and manage risk, you can hop over to the Surfview Capital web site and read the process and philosophy sections. The following are presented in no specific order.

1. (UA) Under Armour

The next major global sporting apparel brand is Under Armour, and at a 3.8B valuation this story is only getting started. They are doing everything right in expanding their product line while sticking to their core strategy as a company, something not easy for apparel brands at their stage of growth. They continue to innovate in the materials used and are seen by both the market and their customers as providing a superior product. You can count me as one of their believers as I wear their compression shorts when I play hockey. They also don’t have a lot riding on non specialized shoes yet which in my mind is a positive as the trend in barefoot running expands this year. They would be smart to buy Vibram or come out with their own line of minimalist shoes.

I also like the apparel industry in general right now as consumers are spending money on the little things, not the big things. Better sports equipment is something people can afford, and they are willing to pay up for quality.

The stock trades at 42X earnings, but at 40+% YOY revenue growth that’s a number they can easily maintain. Profit margins are still expanding and should for quite some time as Under Armour benefits from scale and lower fabric costs recently.

The Q3 earnings report beat the street by a wide margin and produced a big move in the stock. The market still doesn’t understand this brand and how strong it is, producing a huge opportunity.

I wouldn’t own the stock under $63 but odds are it doesn’t get back down to support at that level in the near future anyway. The stock should give you some time to build a position between here and $85, it isn’t going anywhere in a hurry, but longer term it’s giving you a great entry point. Technically we could be seeing a real nice inverted head and shoulders, similar to many good setups right now. UA is also finding good support at the 200 day. I also like the volume profile a lot, the big institutions are still building their positions.

2. (LPSN) Liveperson

RNOW and Assistly were taken out in this space recently and LPSN isn’t far behind. The stock is going to be bid up not only on the back of its fundamentals but the general trend in customer relationship management. Properly interacting with your customers is the new advertising as social word of mouth is far stronger for a brand than any TV commercial. This company has just started to turn the revenue stream on, now growing at over 20% YOY.

At a 690M valuation, I can see a takeout happening at around 1B. Before then, look for the stock to run out of its weekly consolidation pattern.

Your stop is $11.50, I would be building a position here and adding aggressively above $13.50.

3. (CEVA) Ceva

This semiconductor company has been on my radar for quite some time after the run it had in 2010. The company had some very difficult comps to beat in 2011 which stalled the stock. My belief is that 2012 gets this one going again in a big way. They are growing revenue at about 40% YOY, and at 32X earnings this one has a lot of room to grow with some multiple expansion to boot.

I like it right here as it’s broken a short term downtrend and found support at the 200 day moving average. It may take a little while to get this stock moving above its trading range, but building a position here with a stop below $26 looks like a smart play. I would be aggressively adding on high volume moves above $32.

4. (MA) MasterCard

What can you say about MasterCard that hasn’t been said. The financial sector is a mess and capital is flowing into the payments industry largely because money has to go somewhere and this is the only piece of growth to be had. I like Visa as well but MasterCard looks better positioned in mobile payments with the partnerships they’ve made. Mobile payments are going to be huge, and MasterCard is at the center of this revolution.

The stock has been trading in a beautiful channel for almost a year now. Look to buy it on dips to the 50 day moving average and keep a keen eye for a few large distribution candles. The stock isn’t expensive, but just remember, this is a play on asset flow into the stock due to the rest of the sector being crap. If for some reason the financials turn around here, you could see MA underperform. I don’t see that taking place, but it’s something to look out for.

5. (NR) Newpark Resources

Oil has been strong and many other energy names are running, but I’ve always liked the energy service space better than the producers, the stocks trade cleaner and are not as correlated to the movement of crude.

While the stock has gone nowhere for a year and a half now, underneath the covers the company is executing flawlessly. It trades at just 12X earnings making this seriously cheap.

Back out to the monthly chart and you’ll also see that the stock is pushing up against a major long term resistance level. I believe it’s about to break through and go on a tear.

Build your position here and add very aggressively above $10. Big institutions are coming after this stock, evident in the volume profile. You can call the pattern a cup and handle, you can call it whatever you want, it’s bullish and so am I.

6. (FIRE) Sourcefire

Internet security is a huge theme of mine for 2012 and Sourcefire is at the center of it. Warefare is moving online, between both countries and corporations. This trend is not necessarily about the profits that security firms are going to make, but more about asset flow into this space as we’re going to see more m&a activity here and a lot of publicity.

I love the longer term pattern as the stock has been in consolidation for about two years and is now breaking out on big volume. Buy it here aggressively as this stock is going to move quickly. Also keep an eye on the rest of the group, ALLT, CHKP, FTNT and newcomer IMPV, this year as I believe we’re going to see major volatility from the group as a whole.

Use $29 as your stop and buy it off the 50 day moving average.

7. (ASGN) On Assignment

This is an interesting and lesser known name in the staffing industry. At a 430M valuation and only 22X earnings this stock is just getting started.

Revenue growth is really starting to ramp here as companies want to test before they hire permanently. This is the new paradigm in human resources. This company is also in exactly the right space, healthcare which is growing quickly. I don’t see overall employment numbers improving, but companies like On Assignment are going to clean up in this environment.

The pattern here couldn’t look any better. A beautiful inverse head and shoulders has just been confirmed on high volume. The stock has broken through its neckline and is a buy right here aggressively. Use $9.50 as your stop.

8. (WAB) Wabtec

I like the transport sector, especially rail, but many of the names are just a bit slow for me. Wabtec takes advantage of the trend in more rail traffic due to higher fuel prices and has a lot of growth left in the tank. I like Wabtec’s business, selling parts to the rail industry, making everything more efficient. Growth is solid here and we’re just at the beginning of this cycle for the company.

The pattern is even better as we’ve seen great consolidation up near the highs for the past 8 weeks. Another inverse head and shoulders pattern and I’m a buyer here and aggressive buyer on a high volume break of the pattern.

9. (HSTM) Healthstream

Healthstream is the most speculative of the 10, but I love the story here. Healthcare 2.0 is going to be a huge trend in 2012 and this company is positioned very well to take advantage of the asset flow. Web based training for healthcare professionals is this company’s bread and butter, so you get two great trends, online education and healthcare. This company is also going to benefit from large valuations for private venture backed healthcare 2.0 firms. A lot of venture money is flowing into this space, so consider it the TravelZoo of 2012.

The stock has moved quite a bit already but still provides a good short term entry here on a nice flag. The longer term buy point was back at the end of October, but if this company is the winner I believe it will be, you’ll look back on the $4 between there and here and laugh. It’s a 480M company trading at 60X earnings and growing quickly.

And most of all, I love the volume profile. Big institutions are leaving their mark on this stock, they are coming after it hard. This is what you want to see from young companies in emerging spaces. Just be quick to bail if the technicals here fall apart, this is a speculative name.

10. (IBM) International Business Machines

Last but certainly not least, I still love IBM after pounding the table for over a year and a half on this name. IBM is a cruse ship for sure, and it takes a while to get these stocks moving, but boy is it moving now. IBM is innovating at a monstrous pace and scale with both Watson and the chip that acts like a human brain. The company is at the center of the big data trend and is going to capitalize on the information revolution better than anyone.

The area between $174 and $178 is support and I’d be a buyer above the low end of that range.

Look for growth to surge past 15% YOY in the second half, but the short term picture could get a little hairy with the trouble ORCL had in the 4th quarter. Either way, the stock is a buy especially at only 14X earnings. Bid data is a high margin business.

I also want to throw out one big short idea, (STRA) Strayer Education. I have been a bear on this company and this stock since the $170′s, and you know what, it’s going to $20. This company is a flat out fraud. I’ve done the research and spoken to people who have extremely detailed knowledge of just how bad it is over there, how much fraud they are committing. It’s bad.

Over the past few months STRA has worked off some oversold technical readings and is set for its next move to the downside. In order to get this stock to $20 we’re going to need some movement from the government on student loans, which may or may not happen this year, but believe me, as budgets get slashed it’s coming. Either way, the threat of regulatory action regarding the fraud this company is committing will take the stock lower in the mean time.

If you aren’t willing to be directly exposed to how dumb our government can be at times, use STRA as the short side of a pair trade and get long APOL, the least bad of the group. Or, buy some STRA leaps, lock them in a closet for the next year and a half and forget about it.

Remember, without a broader market trading above its rising 50 day moving average and above the 200 day, none of these positions should be heavily entered. 60% of any stock’s movement is determined by the broader market, buying strong stocks in a weak market is a recipe for disaster. The market as a whole still has a lot to prove before a large amount of exposure can be placed on these positions.

That said, while I’ve been bearish to neutral on the market for the past 7 months, the market seems to be getting its act together a bit here. Going into the new year we could see some good opportunities in these names, and many others.

I wish everyone a happy, healthy, and prosperous new year.

If you haven’t yet done so, hop over to Estimize to share your fundamental view of how you believe these companies are going to perform.

The drawing below, please excuse my horrible artistry, is a look into my head regarding the future of social finance.

Click through the drawing to read the article on Abnormal Returns.