Stuart Freeman began his career as a securities research analyst, following the health care industry for A.G. Edwards in 1983; He was eventually named chief equity strategist of the brokerage house.
In cnbc.com’s exclusive OUTLOOK '07 series, Freeman spoke with CNBC’s Carl Quintanilla about what investors and economy-watchers should expect in 2007.
“Jobs are still out there,” and thus “consumers should feel good enough to have a decent Christmas,” Freeman says – though he notes the slow pace of retail sales as shoppers anticipate further discounts.
On the U.S. economy, the equity maven points to two trends. In housing, “the inventory numbers will look better” going ahead through the next three quarters – albeit improving slowly. And while “consumers will continue to work,” he believes they’ll have less liquidity to spend – so look for consumer confidence to soften while the “corporate part of the economy looks strong.”
Freeman cited three stocks he sees as strong through 2007:
- Walgreen , which he lauds for their new stores and offerings of “products used in good times and bad – though he concedes that Wal-mart’s discount drug strategy will impose some “margin compaction” on the firm.
- PepsiCo , Freeman says, “I like the new management and I like the food business internationally.”
- Eli Lilly , whose “long-term products look good.” He says the pharma firm is situated nicely in the sector, which “we don’t think – in the long-term – is dead.”
Disclocure: A.G. Edwards does business with the companies it covers and the firm and/or its officers hold long positions in the securities of the companies mentioned above.