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Stocks: Rating the winners of 2006

Despite all the worries, last year turned out to be quite good for blue-chip stocks. Although prices were flat early in 2006, stocks rallied strongly in the second half.

Unrecognized winners

Stocks selected for the Sivy 70 have to meet a number of tests, including sizable annual revenues and market caps. As a result, most of the stocks on the list - from Coca-Cola and Procter & Gamble to Intel and Pfizer - are quite well known.

Inflation protection

Inflation is the risk that investors most often underestimate. Rising living costs erode the purchasing power of your savings. Inflation can also push up interest rates, which depresses the market value of both stocks and bonds.

Stocks to bank on

All five of the big banks in the Sivy 70 have reported quarterly results in the past 10 days, and the results for the most recent quarter have been remarkably varied.

T. Rowe Price: Bull market winner

Fund manager T. Rowe Price reported stellar earnings on Friday. For the fourth quarter, fully diluted earnings per share were up 23 percent on a 21 percent rise in revenues.

4 blue-chip values

The stock market has gained about 15 percent over the past five months. As a result, shares of some of the top-performing companies now look expensive.

From snacks to riches

Many economists caution that growth could slow during the first six months of 2007. And investors have recently been favoring defensive stocks.

Omnicom: Advertising pays

Nothing happens in business until somebody sells something. And most of the time, that requires a lot of advertising.

Home Depot and Lowe's: Renovation under way

I recommended both Home Depot and Lowe's Companies in the January issue of Money magazine. Since then, both do-it-yourself retailers have reported earnings declines, and analysts expect results for the current year to be up only slightly - or even down.

Expect the bull, prepare for the bear

Last week's unexpected drop in stock prices has unsettled a lot of investors and restarted serious talk that a recession or a bear market is on the way. Either of those threats could come to pass, of course, but neither is particularly likely.