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6 Large-Cap Plays For Investors: Pros

Investors should look into high-quality, large-cap companies for profits, said Arne Espe, portfolio manager at USAA Investment Management and Charlie Smith, CIO of Fort Pitt Capital Group.

Espe Likes:

Johnson & Johnson—“[The company] has had consistent earnings growth and we’re expecting more of that going forward,” Espe told CNBC.

P&G—“About two-thirds of their earnings are derived overseas and they’re also an emerging market play,” Espe said of the firm.

IBM

Smith Likes:

Comcast*— “Their loss of video subscribers was at the lowest in four years and they’re selling at 9 times free cash flow and 11 times free cash flow yield,” Smith said. “We’ve got a target of $35 on the stock and they had a terrific quarter.”

Sandisk— “[They’re the] leader in technology for flash memory and their supply-demand dynamics in flash memory is improving,” he said. “The Japan earthquakehas not knocked them off plan at all and we expect 50 million tablets to be sold around the world this year, driving demand for high value name flash memory, and their margins should be pretty good.”

First Energy

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Scorecard—What He Said:

  • Smith's Previous Appearance on CNBC (Mar. 17, 2011)

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More Market Intelligence:

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CNBC Data Pages:

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CNBC Slideshows:

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Disclosures:

No immediate information was available for Espe or Smith.

*Comcast is the new parent company of CNBC and CNBC.com.

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Disclaimer