Stocks advanced after a handful of upbeat economic reports Thursday. John Buckingham, chief portfolio manager at Al Frank Asset Management, and Bill Smead, CEO and CIO of Smead Capital Management, shared their best plays.
“We are in the seasonally favorable time of the year and the economic data over the last week has generally been very good, relative to expectations,” Buckingham told CNBC.
“So we’ll close the year higher than where we are today and I am optimistic about 2011.” (Scroll down for his full list of stock picks.)
In the meantime, Smead said markets are entering the period where they will start to "bifurcate."
“The emerging-market enthusiasm has reached a completely silly stage and at that stage, China’s problems should become more and more obvious over the next six months,” said Smead.
“So the cyclical commodity-oriented [markets] like Australia and Canada that have dug themselves up and shipped themselves to China will go out of favor. And what will come into favor is the rumblings from the low end of the U.S. economy.”
So investors ought to 'buy domestic,' suggested Smead.
“The consumer discretionary stocks are outstanding and that’s an internal thing and a lead indicator,” he said.
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Smead Likes:
Merck
Abbott Labs
Mylan
Wells Fargo
Bank of NY Mellon
Buckingham Likes:
Abbott Labs
Home Depot
MDC Holdings
Hudson City Bank
Lockheed Martin
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Scorecard—What They Said:
- Buckingham's Previous Appearance on CNBC (Jul. 24, 2010)
- Smead's Previous Appearance on CNBC (Nov. 3, 2010)
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More Market Analysis:
- Dow Could Trade Above 12,000: Schwab's Sonders
- Predictions 2011: Kaminsky on IPOs And Bonds
- Stocks Are Cheapest Assets—So Buy These: 4-Star Pro
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CNBC Slideshows:
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CNBC Data Pages:
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Disclosures:
No immediate information was available for Buckingham or Smead.
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