Guru-Style Service Sector Picks

In his latest article for Morningstar, Validea CEO John Reese looks at top stocks from the service sector — an area of the economy that he says is faring better than many realize. “Service-type companies, and the service sector as a whole, have become the real bellwethers of U.S. economic activity,” Reese writes. “And lately, […]

Buffett’s Berkshire Buyback: A Bullish Sign?

Warren Buffett and Berkshire Hathaway recently announced a share buy-back authorization, which may be signaling optimism from Buffett on the economy. The move marks the first time in four decades that Berkshire will be authorized to buy back its own shares, according to Bloomberg. It is allowed to do so only if its price is […]

Greenblatt: Stocks Looking Cheap — Very Cheap

Hedge fund guru Joel Greenblatt says that, based on trailing free cash flow yields, stocks are trading at levels that put them in about the 95th percentile of cheapness when examining the past 20 years of market history. Greenblatt tells CNBC that if the past is any indication, valuation levels this low could be proceeded […]

De Vaulx Likes Oil & Gas, Japan

Top value investor Charles De Vaulx has been cutting back on gold holdings and is high on oil and gas stocks and Japanese equities. De Vaulx tells Bloomberg that with cash yielding very little, bond yields low, and gold having gone “parabolic” over the summer, stocks of good companies with solid dividends look like attractive […]

Paulsen: Time to Move toward Cyclicals

Wells Capital Management Chief Investment Strategist James Paulsen says he thinks it’s time to lighten up on safety-oriented stocks like utilities and consumer staples, and put cash into more cyclical-type stocks, like industrials and emerging market plays. Paulsen tells Bloomberg that if October data continues to show that the U.S. economy isn’t entering a new […]

Deflation Could Help Us, Trahan Says

Highly-rated strategist Francois Trahan says that “deflation” is not a dirty word, and that the Federal Reserve could help the economy by allowing deflation to stem commodity price inflation that is “eroding people’s pockets”. Trahan says Fed members and other policymakers and economists are relying on economic principles that aren’t relevant right now. Three main […]

Discipline Crucial, Top Newsletter Editor Says

The Cabot Market Letter is having another market-beating year, and its editor is preaching discipline amid the current market volatility. “Going forward, it’s important to remember to take your cues from the market itself, and not from the headlines that are sure to push the market up and down in the days ahead,” Michael Cintolo […]

J.P. Morgan Strategist: Ideal Buying Time May Be Near

J.P. Morgan U.S. equity strategist Thomas Lee says we may be near an ideal buying opportunity for stocks. According to Lee, 53% of stocks are trading for less than 12 times earnings, the most stocks selling so cheap since late 2008, the Financial Post reports. In addition, 51% of stocks are trading for less than […]

Ritholtz: “Austerians” Have It All Wrong

Barry Ritholtz of FusionIQ and The Big Picture blog says that the Federal Reserve has done just about all it can do it fix the economy, and that changes to fiscal policy are needed to really get things moving in the right direction. But, he adds, many government officials have a track record of getting […]

Shiller Talks Housing, Bubbles

Yale Economist and housing guru Robert Shiller says the government still isn’t doing enough to help the housing market. Shiller, who called the bursting of both the tech stock and housing bubbles, tells Fox Business Network that he’s worried we could see more downside for housing prices. He also says that he has a “gut feeling” […]

Biggs High On Cash Amid Fear of Financial Crisis

Hedge fund guru Barton Biggs says he’s only 20% net long on equities in this market, and says we may be on the eve of another financial crisis. Biggs says policymakers have tools at their disposal to help, but have failed to come together to do so in Europe or the U.S. “In times like […]

Valuations Have Bolton Bullish

Fidelity’s Anthony Bolton says he’s optimistic about global equities, and valuations are a big reason. “I am still a bull of world equity markets,” Bolton, who produced an exceptional track record in the U.K. and now oversees a China-focused fund, said at an Investment Week conference. “I think in this business you have got to […]

Fisher: Ignore “Chittering Chimpanzee” Pundits

Kenneth Fisher says investors’ short memories are causing them to fall prey to overblown fears about the economy and stock market, and says he thinks stocks will make some nice gains between now and the end of the year. “Last year we were fixated on Congress with health care and Dodd-Frank concerns — and PIIGS […]

Herro: This Isn’t 2008; Values Abound In Quality Stocks

Morningstar Fund Manager of the Decade David Herro says the market is littered with cheap quality stocks right now, as investors erroneously compare the current financial situation to the crisis that hit in 2008. “I think the biggest worry … is people don’t want to get caught like they were in 2008 and perhaps ’09,” […]

Grantham Gloomy, But Finding Value

GMO’s Jeremy Grantham is predicting more gloom for the U.S. economy, but he says stock valuations are “finally” such that investors can build portfolios of equities with potential for solid long-term returns. “If we adjust earnings to normal and apply an average P/E, you can finally build a decent portfolio today of global equities at […]

Meredith Whitney, The Bull?

While she’s known for her bearish calls, including her prescient prediction of the banking crisis that hit the U.S. in 2008, analyst Meredith Whitney says she’s seeing “incredible opportunities” for investors right now. “Fundamentals are not playing into valuations now at all,” Whitney says, according to CNBC. “You’ve got great companies that are trading horribly, […]

Arnott on Why the Valuation Picture Is Troubling

Interest rates and inflation have a much greater role in stock market valuations than you might think, and that means the stock market is on a “very dangerous” path, according to Rob Arnott. In an article for Morningstar, Arnott, of Research Affiliates and PIMCO, looks at the relationship between stock market valuation levels, interest rates, […]

The Lynch Approach: GARP, PEGs, and Profits

Every other issue of The Validea Hot List newsletter examines in detail one of John Reese’s computerized Guru Strategies. This latest issue looks at the Peter Lynch-inspired strategy, which has averaged annual returns of 6.4% since its July 2003 inception vs. 2.1% for the S&P 500. Below is an excerpt from the newsletter, along with several top-scoring […]

Hussman: Recession Now “Virtually Certain”

Fund manager John Hussman says a new recession — and a Greek debt default — are now “virtually certain”. In his latest market commentary, Hussman says that the markets seem to be viewing the current situation as a replay of the 2010 correction, and are holding out hope that the Federal Reserve will launch another […]

Hulbert: History Says Value Stocks May Be Ready To Rebound

MarketWatch’s Mark Hulbert says that a couple of historical factors are indicating that value stocks may be ready to finally start outperforming growth stocks again. Hulbert notes that value stocks, which over the long term have enjoyed a significant edge over growth stocks, have lagged their growth peers for the past few years — the […]

Why The Coming Decade Should Be Good For Stocks

Financial historian and NYU Stern School of Business Professor Richard Sylla — who in the late 90s predicted that the next decade would be a weak one for stock returns — says history shows the market is likely to make some nice gains in the coming decade. “People ought to take a longer view and […]