Five-Star Stocks In Ill-Starred Sectors

Andrew Fisher

Retail, financials and homebuilding.  Sectors to avoid at all costs?  Not according to Bob Turner, chief investment officer and portfolio manager at Turner Investment Partners.

His five-star Turner Core Growth Fund is up an average of 15.23 percent per year over the last five years.

And on a day when the upscale department store chain Nordstrom

announced same-store sales declined 5.8 percent in February, Turner said he likes the company's stock.

"We think it's time to invest in some of the early-cycle stocks," he told CNBC.  "You've got to go with high quality; Nordstrom's is high quality."

Also on his list, Merrill Lynch.

"Merrill Lynch is certainly one that's controversial now," he admitted.  "We like the management change; we like the fact that they've done a lot of write-offs; they've got a great retail network; their interest in both Blackstone and Bloomberg is good as well."

Tapping the Seasoned Investors

Another of Turner's "early-cycle" stock picks is NVR, a middle-market homebuilder.

"First of all, their geography's good; they're around D.C. and Baltimore; the government doesn't necessarily lay people off in an economic slowdown, and they've got a ready group of buyers there," he said. "It's extremely well managed; the company's generating significant cash flow; they bought back shares; there's nice insider buying in the company right now."