Time to Think Smaller — And Be Bolder
David Sowerby of Loomis Sayles says the market is close to a bottom, and stock investors should act accordingly.
"Be bold," he told CNBC. "Every time in the last month we've come on and talked about a bottoming process, you have the tendency to look almost foolish, but I think the bigger injustice would be, 12 months from today, looking back at...not having recognized the opportunity that exists today."
So where are those opportunities?
Sowerby likes Brink's .
"If you look off of market bottoms, smaller-cap, mid-cap stocks have generally beaten large-cap stocks by about 10 percentage points on a two-year, cumulative return basis," he said. "Brink's is one of those names. They spun off their home division; it's more the commercial business; very strong cash on the balance sheet."
That's something he says he looks for across the market, and something he also finds in Perrigo.
"(It's) the generic over-the-counter cough-and-cold prescription company, selling products at generally 30 percent below name-brand merchandise, but with exactly the same quality of the product, another high cash-flow generating company," he said.
Also on his list is financial services provider Duff & Phelps, "which is capitalizing on business from the FDIC on putting valuations on some of these troubled banks."
Duff & Phelps recently sold off sharply on disappointing quarterly earnings.
Disclosure information for David Sowerby was not immediately available.