Many mid-cap stocks are well-positioned to take advantage of a resurgent consumer and have limited exposure to Europe, said Pat Dunkerley, fund manager at Scout Mid Cap. He shared his top plays.
“We have data going back to 1979 that shows how mid-cap stocks have outperformed both small and large caps, with better risk-adjusted returns,” Dunkerley told CNBC.
“We’re focused on the domestic equities—equities that don’t have a lot of exposure to Europe.”
Dollar Tree Stores
Host Hotels—“We think travel’s beginning to pick up on the leisure and the business side and so it’s a good way to play the recovery in this economy,” said Dunkerley.
Macy’s—“Their sales are improving and they’re using their cash flow to improve their balance sheets and they’re paying down debt,” he said of the firm.
Nexen—"This is a resource rich oil company—one of the cheapest in the group,” he said. “They have a diversified asset based spread around the world…We think it’s very cheap.”
Hospira—“They are poised to take market share because one of their competitors stumbled,” he explained. “They also manufacture injectable drugs that are generic so they can save the hospital money and help save lives with better equipment.”
Scorecard — What He Said:
- Dunkerley's Previous Appearance on CNBC (May 6, 2010)
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No immediate information was available for Dunkerley or his firm.