Three High Flying Stocks To Sell, And Three Undervalued Companies To Buy (LVS, SIRI, OPEN, ROST, INT, NPK)

John Dorfman, chairman of Thunderstorm Capital in Boston, wrote an

for Bloomberg.com yesterday. The piece is titled "Three Stocks to Ax Now, Three Bargains to Buy: John Dorfman." He focuses on three high flying stocks that he believes have gotten overextended and suggests three value plays that may offer better returns as we move towards 2011. The first stock that makes Dorfman's Sell List is Las Vegas Sands (NYSE:

). The shares are up more than 150% in 2010. He believes that the company is worth somewhere between $2.5 billion and $26 billion. Currently, LVS has a market cap of over $25 billion, which puts it right a the top of that broad range. Therefore, Dorfman does not see much upside left in the shares. The next stock on his sell block is Sirius XM Radio (NASDAQ:

). He writes, "I do not like the company's capital structure, with almost $17 in debt for every dollar in equity." The shares have gained 115% this year and are trading at 129 times recent earnings. Furthermore, the company has posted a loss every year since it went public in 1994. The final hot stock on Dorfman's Sell List is OpenTable (NASDAQ:

). The company has created a system by which diners can make restaurant reservations online at no charge. OPEN's revenues are generated from participating restaurants. Dorfman believes that this is a business with low barriers to entry, which could cause OPEN problems down the road. The shares have jumped 146% year-to-date, and trade at nosebleed levels - around 160 times recent earnings. Three stocks that Dorfman likes right now are Ross Stores (NASDAQ:

), World Fuel Services (NYSE:

) and National Presto Industries (NYSE:

). He said that all of these names have passed his "Old Faithful" screen, which requires average annual earnings growth the past five years of 15 percent, a return on equity of 15 percent or more, a price-to-earnings ratio of less than 15, debt less than 50 percent of equity, and a price-to-sales ratio below 2. Only around 30 U.S. stocks meet these requirements currently. Ross Stores (

) is a Pleasanton, California based clothing retailer. The company has reported annual profits in every fiscal year since 1988. The stock trades at a reasonable P/E of 13. ROST has gained around 31% in 2010. World Fuel Services Corp (

) offers fuel, maps, flight plans, and other services to operators of planes and boats. The company does business throughout the world but generates most of its revenue in the U.S., Singapore, and the U.K. INT trades at about 12 times earnings and is up a little over 1% year-to-date. Eau Claire, Wisconsin based National Presto Industries (

) generates most of its revenue from defense products such as ammunition and cartridge cases. The shares have gained around 8% this year and trade at 12 times earnings. One potential bullish factor for NPK is the fact that no Wall Street analysts cover it, which suggests it is likely not on the radar of big investors - yet. The company has a market cap of $762 million.