Saturday, January 21, 2017

Barrons weekend summary

Barrons weekend summary: Positive on GOOGL, GME 
Cover story: The second installment of Barron's 2017 Roundtable offer picks for the new year from Scott Black (DHI, FN, ZBH, RDS.A, FCX), Jeffrey Gundlach (PPT, BKLN, INDA, DXJ), Meryl Witmer (Dart Group, Linamar, VIRT, CPS), and Mario Gabelli (VIA.B, HRI, CNHI, FIZZ, Davide Campari-Milano, Liberty Braves Group, LYV, MWA). 

1) Positive on GOOGL: Shares could rise 20% on two major trends this year: digital venues will draw more ad spending than TV, and mobile will make up more than half of digital spending; 
2) Brian McGill, a financial advisor from suburban Atlanta, is the winner of Barron's 2016 forecasting challenge, with the highest score in the contest's 15-year history; 
3) Positive on GME: Videogame retailer has seen sales drop, but is countering that by expanding into mobile and wireless, featuring devices from T and AAPL.

Tech Trader: For semiconductor industry investors, "this year's dilemma is one of conservatism versus radicalism"-or an industry heavyweight such as AMAT versus a specialist such as ASML. 

Trader: The market is making a big mistake if it bets on gridlock under the Trump administration, says Brian Belski of BMO Capital Markets; Cautious on DIS: The stock's strength largely stems from the company's strong movie studio, but that division may not be able to live up to future expectations, and there may be little upside; Ed Yardeni of Yardeni Research says analysts have yet to incorporate tax cuts and other pro-business actions from the new administration into their forecasts-and when they do, those should go up. 

Profile: Eric Schoenstein, co-manager of the Jensen Quality Growth fund, runs a very concentrated portfolio, evaluates the 10-year outlook of any potential investment, and holds stocks for an average of seven years (top 10 holdings: BDX, PEP, MSFT, UTX, MMM, JNJ, UNH, ECL, PX, ACN). 

Small Caps: Positive on PDCO: The drop in share price following the end of the company's 20-year exclusive distribution relationship with XRAY looks like an opportunity for investors, and the move could pave the way for growth. 

Follow-Up: Cautious on NFLX: Share price will continue to support its rich valuation as long as the company continues to beat subscriber expectations; investors may not want to buy Netflix, but they shouldn't bet against it; Cautious on CF: Now may be the time to take profits on the stock, which has seen a rebound, though the company faces a number of industry challenges, including slumping demand for fertilizer in the U.S.

European Trader: Positive on EI, LUX: Companies' merger makes strategic sense, because each is a leader in its field and there is little overlap between their products, and the execution risks of a large, international deal appear minimal. 

Asian Trader: Cautious on Bellamy's: Australian maker of organic infant formula faces a major hurdle now that China requires food makers to submit to testing and inspections before selling in the country. 

Emerging Markets: "The strength of the U.S. dollar poses a big investing risk for 2017, and is key to emerging market debt strategy. But investors can't ignore emerging market bond funds." 

Commodities: "Gold is starting to regain its luster in the new year, reversing a long string of losses following the U.S. presidential election." 

Streetwise: Cautious on GT, GM: Shares are near highs, yet remain long-term laggards, but there's evidence that such laggards should interest long-term investors.