A forstner bit is usually the way to go for a clean cut, but I can see where igorrock would mention the spade bit. A quality forstner bit with an extension, don't forget to check that the extension bulge clears the hole size, can set someone back forty plus bucks.

Careful, it's not always so easy to control a forstner bit free hand, and someone may want to go in at an angle to follow the lines of the stock. Whatever the choice, if it's heading off track, stop and call it good.