Stocks I like for a 5 year horizon

I was asked for some stock advice by a friend today and I figure I would post my response on my blog so I can go "on the record" with my opinions:

Everyone hates stocks now, which is the correct time to get in. All the economic downturn fears are priced in to the stocks! So you don't have to worry about an economic downturn. You're already receiving that discount! If you are looking for a long time horizon I'd park a couple thousand in the following:

Devon Energy (DVN): This is a longterm play on Oil and on Natural Gas. They derive half their income on each. The share price just took a major hit in the past 2 weeks since the price of oil and nat gas tanked. It's a great company and a good stock. It has been volitile as of late, but if you believe as I do that the price of energy will continue to march up in the next 5 and 10 years, don't worry if it looses value. It will come back. I originally bought it at $55 around 2 years ago and sold it at $111 a few months ago. I just bought back in last week at $91. That's about where it is today. I don't expect this stock to go below $75, but even if it does I will pick up more, for sure.

Goldman Sachs (GS): This company boasts the best minds on Wall Street and the most repected investment bank in the world. They were one of the few financials that were smart enough to get out of the mortgage investments before that hit the fan. They just got downgraded today because they are highly exposed to stocks and the analists feel that their profit is limited with the current bear market. This drove the stock price down. If you believe as I do that the stock market is a good investment on the whole, and for the long term, this company is a must have. The closing price today is a perfect entry point. Remember, you buy low, when everyone else is selling. The price has been driven down by people with a short time horizon.

PXJ - This is an Exchange Traded Fund (ETF) that tracks the oil services industry as a whole. It is a bet on the sector that provides the drill bits and oil platforms, etc, etc to the oil exploration and the drilling companies. This sector was run up along with oil this year and when oil busted 2 weeks ago, this sector took a correction along with it. In my opinion it was not warrented, because most of the oil explorations and drillings are profitable with a price of oil over $60/barrel. Today after the current rundown from $140, oil is still at $112/barrel. Another note: During the 70's oil crisis, the oil services sector was run up over 1000%.

General Electric (GE) - This stock price has been run down recently. It's got a good dividend and is one of the best managed companies in the world. They recently entered an agreement with the Saudis, I think, where they agreed to buy a good chunk of the company over the next few years. What this does is put a continued upward pressure on the price of the stock, or conversely, it puts a floor on the price. It's got great international exposure and thus is not dependant on a strong dollar to make money.

Exxon Mobil Corp (XOM) - One of the best managed oil producers and refiners in the world. It's stocks been run down alot. The reasons for this price action are complex and I can't really explain it here. But it is a great company and a good long term bet.

Simon Property Group (SPG) - this is a Real Estate Investment Trust (a.k.a. a REIT). that owns, manages and developes retail real estate properties consisting primarily of regional malls, Premium Outlet centers, The Mills, and community/lifestyle centers. David Simon is the CEO and is one of the smartest names in the business. This may be a risky short term play, but luckily you aren't going to play for the short term. Real estate has been beaten down as you know, and may continue to be for some time but it will inevitably come back. Also, it's a bet on retail which is very much out of favor right now. My suggestion with this stock is to put a buy order in around $85 (It's at $97 today) and if it continues to decrease in price then BUY MORE! This is definately a long term play, but a good one. About 6 months BEFORE the economy turns around whether in 1 year or in 3 years, this stock will quickly rise and be a superstar.

My suggestion to you is to place some money in each of these stocks and let them ride for at least 5 years. Don't think about it, don't worry about, just do it and then forget about. Some of them may decrease in value from month to month. Some of them will increase. This is ok. That's what stocks do. These are not high risk plays and if this little 6-stock portfolio doesn't make you money in 5 years, then our entire economic model is in trouble, and this little stock bet will be the least of your economic woes. Finally, don't wait for the economy to turn around and the news to be rosy. Stock prices rise 6 months before the economy turns around. The market is a forward looking beast. The downturn has been, for the most part, priced in currently. Perfect investment time.