Cover story: The top firms on Barron’s annual list of Best Fund Families “did what they were supposed to do—beat their benchmarks and outperform their respective Lipper peers”; Taking the top spot is American Funds, up from No. 36 in the previous ranking, followed by MainStay Funds and Eaton Vance.
Features: 1) Baron’s list of the Top 1,200 Financial Advisors, which “recognizes outstanding advisors from all 50 states, plus the District of Columbia. It’s our largest, most comprehensive listing, and it encompasses everyone from independents, who own and operate their own practices, to employees of the big Wall Street firms”; 2) Positive on DAL: Delta is the best-managed U.S. airline, and its stock trades cheaply—at about $50, shares fetch less than eight times projected 2019 earnings of $6.51 a share, and its dividend yield of 2.8% is the highest among its peers”; 3) Positive on RIG, ESV, DO, Borr Drilling: The offshore drilling business has suffered its deepest downturn in 30 years, as investment capital pours into land-based shale, but there are early signs of a return to the sea, and investors who dive in now could profit nicely; 4) Revitalization efforts in Detroit appear to be finally taking hold—ten years after it was hit by the financial crisis and the near-collapse of the auto industry, new investment has made the city home to thriving start-ups, hotels, and coffee shops.
Tech Trader: Positive on INTC: Chip maker’s stock hasn’t moved much despite impressive 2018 financials, primarily over concerns about a long-lasting CEO search and rising competition—but the risks appear overblown, and are already priced into the stock.
Trader: Economic volatility has been low since the financial crisis and growth has been slow and steady, preventing inflation from rising too quickly or corporate spending from getting overheated—making it difficult for the economy to slip into a recession; “The economy today isn’t in the same spot as it was back in 2000 and 2001, when the dot-com bust helped trigger a mild recession. But we might be at a tipping point for decelerating growth”; Cautious on DWDP: As the company prepares to break into three, investors must decide which parts to keep or sell—and the answer will depend on their investment goals and what they need for industry exposure.
Interview: Christopher Wood of CLSA Asia-Pacific Markets and author of the “Greed & Fear” newsletter makes a case for avoiding U.S. stocks and buying Asia instead.
Profile: David Eiswert, manager of the T. Rowe Price Global Stock Fund, has access to all of TROW’s 158 global equity analysts, and he looks anywhere in the world for opportunities (top 10 holdings: GOOGL, Essity, AMZN, Tencent Holding, BDX, SRE, BABA, ISRG, NEE, PYPL).
Follow-Up: Cautious on DLTR: Company’s announcement that it will move faster to fix its business and close a number of Family Dollar stores is a gift for investors—but while the sense of urgency has promise, the turnaround process remains a risky work in progress.
European Trader: Cautious on Aston Martin Lagonda: Automaker’s shares crashed after it went public, but the company is on a mission to prove doubters wrong, and all signs indicate it’s taking the right steps.
Emerging Markets: Rumors of a U.S.-China trade deal are boosting Chinese stocks, but Beijing has also helped by tilting away from deleveraging and towards economic stimulus.
Commodities: “Coffee has fallen below a dollar a pound to trade close to its lowest level in more than a decade, but a global glut that pushed prices down for the past two years may finally come to an end in 2019.”
Streetwise: Daniel Ives of Wedbush sees 25% upside for MSFT during the next year as it increasingly sheds its underdog status and better competes with AMZN and other rivals in areas such as cloud computing.