Despite a gain of more than 10% in the S&P 500 over the past three months, there’s still a real buying opportunity in growth stocks: Our 10 best for 2011 are expected to bolster their profits an average of 61% next year — vs. 14% for the S&P — and yet they trade at an average 12 times next year’s earnings, vs. 13 times for the S&P.

Our selections this year are slanted toward commodities. Exposure to oil, chemicals, and fertilizer should provide protection against a falling dollar or an outbreak of a 1970s-style rise in inflation, which we think is a bigger threat than a double-dip recession. (We’ve also made some contrarian selections, including one housing-related stock.)

Best Stocks For 2012: First Commonwealth Financial Corporation (FCF)

First Commonwealth Financial Corporation operates as the holding company for First Commonwealth Bank that provides consumer and commercial banking services to individuals and small and mid-sized businesses in central and western Pennsylvania. The company offers personal checking accounts, interest-earning checking accounts, savings accounts, health savings accounts, insured money market accounts, debit cards, investment certificates, fixed and variable rate certificates of deposit, and IRA accounts. It also provides secured and unsecured installment loans, construction and mortgage loans, safe deposit facilities, credit lines with overdraft checking protection, and student loans, as well as Internet and telephone banking, and automated teller machine services. In addition, the company offers commercial banking services, including commercial lending, small and high-volume business checking accounts, on-line account management services, ACH origination, payroll direct deposit, commercial cash management services, and repurchase agreements. Further, it provides various trust and asset management services, as well as a complement of auto, home, business, and term life insurance. Additionally, the company offers annuities, mutual funds, stock, and bond brokerage services through an arrangement with a broker-dealer and insurance brokers. It operates 115 community banking offices in western Pennsylvania and 2 loan production offices in downtown Pittsburgh and State College, Pennsylvania. The company was founded in 1982 and is headquartered in Indiana, Pennsylvania.

Advisors’ Opinion:

• By Philip At 2011-11-8

  Shares First Commonwealth Financial Corp.(FCF) of Indiana, Pa., closed at $4.75 Friday, declining 31% year-to-date. Based on a consensus price target of $6.46, the shares have 36% upside potential.

  Based on a quarterly payout of three cents, the shares have a dividend yield of 2.53%.

  First Commonwealth had $5.7 billion in total assets as of Sept. 30, operating 112 First Commonwealth Bank offices in 15 counties in western and central Pennsylvania.

  The company reported third-quarter earnings of $8.3 million, or 8 cents a share, increasing from $7.4 million, or 7 cents a share, during the second quarter, but declining from $10.6 million, or 11 cents a share, in the third quarter of 2010.

  The year-over-year earnings decline reflected an 8% decline in net interest income to a tax-adjusted $48.8 million in the third quarter, as the company saw an 8% decline in its loan portfolio, “as the result of more disciplined underwriting guidelines concerning geography and size for commercial loans, the managing down of large credit relationships over $15 million,” and weak loan demand.

  The net interest margin declined to 3.81%, increasing from 3.76% the previous quarter, but declining from 3.90% a year earlier.

  Earnings were also affected by a $7.0 million third-quarter provision for loan losses, which was down from $9.1 million the previous quarter, but up from $4.5 million a year earlier.

  First Commonwealth’s nonperforming assets ratio was 3.45%, increasing from 3.22% the previous quarter and 2.70% a year earlier, with one commercial credit relationship in Pennsylvania representing $32.8 million, or 17% of the company’s $195.2 million in nonperforming assets.

  The third-quarter net charge-off ratio was 1.00% and reserves covered 1.81% of total loans as of September 30.

  Following First Commonwealth’s earnings announcement, Sterne Agee analyst Mike Shafir reiterated his Buy rating on the shares, with a price target of $6.50, and said that “While NPAs rose during the quarter, the company exhibited positive trends with a higher net interest margin, lower expenses, and a reduction in the pace of loan decline.”

  The shares trade for 11.3 times the consensus 2012 EPS estimate of 42 cents, and 0.8 times their Sept. 30 tangible book value of $5.77, according to SNL Financial.

  Six out of nine analysts covering First Commonwealth rate the shares a buy, while the remaining analysts all have neutral ratings

Best Stocks For 2012: Northstar Realty Finance Corp. (NRF)

NorthStar Realty Finance Corp. operates as a real estate investment trust in the United States. It invests in real estate debt business, which acquires, originates, and structures debt investments secured primarily by income-producing real estate properties; real estate securities business that invests in commercial real estate debt securities, including commercial mortgage backed securities, REIT unsecured debt, and credit tenant loans; and net lease properties business, which acquires properties that are primarily net leased to corporate tenants. The company has elected to be taxed as a REIT and it would not be subject to federal income tax, provided it distributes at least 90% of its taxable income to its shareholders. NorthStar Realty Finance was founded in 1997 and is based in New York City.

Best Stocks For 2012: Tyson Foods Inc. (TSN)

Tyson Foods, Inc., together with its subsidiaries, engages in the production, distribution, and marketing of chicken, beef, pork, and prepared food products, as well as related allied products worldwide. The company?s Chicken segment involves in breeding and raising chickens, as well as processing live chickens into fresh, frozen, and value-added chicken products. Its Beef segment processes live fed cattle and fabricates dressed beef carcasses into primal and sub-primal meat cuts and case-ready products. The company?s Pork segment involves in the processing live market hogs; and fabricating pork carcasses into primal and sub-primal cuts and case-ready products. Its Prepared Foods segment manufactures and markets frozen and refrigerated food products comprising pepperoni, bacon, beef and pork pizza toppings, pizza crusts, flour and corn tortilla products, appetizers, prepared meals, ethnic foods, soups, sauces, side dishes, meat dishes, and processed meats. The company markets and sells its products to grocery retailers, grocery wholesalers, meat distributors, warehouse club stores, military commissaries, industrial food processing companies, chain restaurants or their distributors, international export companies, and domestic distributors, as well as to foodservice operations, such as plant and school cafeterias, convenience stores, hospitals, and other vendors. Tyson Foods, Inc. also offers its allied products to the manufacturers of pharmaceuticals and technical products, as well as to pork processors. The company was founded in 1935 and is headquartered in Springdale, Arkansas.

Best Stocks For 2012: Cintas Corporation (CTAS)

Cintas Corporation provides corporate identity uniforms and related business services in North America and Latin America, Europe, and Asia. The company operates through four segments: Rental Uniforms and Ancillary Products; Uniform Direct Sales; First Aid, Safety, and Fire Protection Services; and Document Management Services. The Rental Uniforms and Ancillary Products segment engages in the rental and servicing of uniforms and other garments, including flame resistant clothing, mats, mops and shop towels, and other related items. It also offers restroom cleaning services and supplies; and tile and carpet cleaning services. The Uniform Direct Sales segment involves in the direct sale of uniforms and related items, and branded promotional products. The First Aid, Safety, and Fire Protection Services segment offers first aid, safety, and fire protection products and services. The Document Management Services segment provides document destruction, document imaging, and document retention services. The company also operates document imaging and storage facility that provides solutions to help customers securely store and maintain sensitive business information and data. Cintas Corporation offers its products and services through its distribution network and local delivery routes, or local representatives to small service and manufacturing companies, as well as corporations. The company was founded in 1968 and is headquartered in Cincinnati, Ohio.

Best Stocks For 2012: The NASDAQ OMX Group Inc. (NDAQ)

The NASDAQ OMX Group, Inc. provides trading, clearing, exchange technology, securities listing, and public company services worldwide. It offers trading across various asset classes, including cash equities, derivatives, debt, commodities, structured products, and exchange traded funds; capital formation solutions; financial services and exchanges technology; market data products; and financial indexes, as well as clearing, settlement, and depository services. The company also provides broker services comprising technology and customized securities administration solutions, such as back-office systems to financial participants. In addition, it offers global listing services; technology solutions for trading, clearing, settlement, and information dissemination; and facility management integration, surveillance solutions, and advisory services, as well as develops and licenses NASDAQ OMX branded indexes, associated derivatives, and financial products. As of December 31, 2010, a total of 2,778 companies listed securities on The NASDAQ Stock Market. The NASDAQ OMX Group supports the operations of approximately 70 exchanges, clearing organizations, and central securities depositories. The company was formerly known as The Nasdaq Stock Market, Inc. and changed its name to The NASDAQ OMX Group, Inc. in February 2008. The NASDAQ OMX Group, Inc. was founded in 1971 and is based in New York, New York.

Advisors’ Opinion:

• By Goldman At 2011-8-28

  NASDAQ OMX Group(NDAQ) provides trading, exchange technology and securities listing to companies worldwide. It operates the NASDAQ stock market, home for technology shares.

  The company has seen a tremendous rebound in profitability since the market rally began in 2009. NASDAQ’s fourth-quarter adjusted earnings advanced 20% to 55 cents, exceeding analysts’ consensus target by 8.5%. Its top-line figure, down 3.9%, outperformed consensus by 5.1%. NASDAQ OMX’s operating margin widened from 20% to 22% in the latest quarter as expense growth dropped.

  Despite the solid earnings beats, NASDAQ receives lackluster reviews, with 10 “buy” calls and 12 “hold” recommendations. In addition to Goldman, Barclays is optimistic about NASDAQ, ranking its stock “overweight” and predicting another 20% of upside to $32. The stock sells for a forward earnings multiple of 9.7, an attractive 16% discount to the specialized finance industry average. Its PEG ratio, a measure of value relative to growth, of 0.5 reflects a 50% discount to estimated fair value. Recent acquisitions, including Nord Pool and Zoom Vision, are bolstering the company’s global platform. Its share-repurchase program lessened the float 6.2% year-over-year.

  Goldman removed NASDAQ from its Conviction Buy List on Jan. 12, but maintained its “buy” rating and target. Many near-term catalysts were realized. NASDAQ’s stock has jumped 21% in three months. Goldman still likes the company’s longer-term prospects.