Barrons summary: positive on AMTD, PBI; cautious on AVP
Cover story: Profile of Jana Partners Barry Rosenstein, whose Jana Nirvana fund has had a three-year annualized gain of 19.1%, topping the 16% return of the S&P 500 since the end of 2013 (+ WAG, OIS, EQIX); Barrons list of the Top 100 Hedge Funds, led by Glenview Offshore Opportunity, Hildene Opportunities LP, Chenavari-Toro Capital IA Class A, Childrens Investment Ltd., and Tiger Global.
Features: Cautious on AVP: Company is doing well under turnaround led by CEO Sheri McCoy, and bulls argue shares could return to the low $20s in a couple of years, but key to success hinges on fixing North American operations; Positive on AMTD: Improving trading volumes could help shares appreciate by 35%, while rising interest rates could give entire sector a boost; Positive on PBI: Under CEO Marc Lautenbach the companys postage-meter business has stabilized and become profitable, while new digital businesses will continue to drive growth that could boost shares 60% in the next three years.
Tech Trader: Cautious on CSCO: Despite beating expectations for fiscal third quarter, company still faces a major threat from software-defined networking, in which its equipment can be replaced by something like a general-purpose computer running switching software; Cautious on FB, AMZN: Tiernan Ray continues to question the metrics being used by analysts to trumpet shares of tech giants.
Trader: Despite index highs, says Michael Marrale of ITC, theres an incredible amount of pessimism and negativity in equity markets; Cautious on TGI: Aerospace structure business is companys problem child, but if it can fix that, slowing growth may stabilize and it may win more contracts such as a recent one from Airbus; Negative on WWE: Stock price contains a lot, but not all, of the recent bad news for company that has overestimated its ability to attract new viewers.
Follow-Up: Cautious on PFE: Pharma giant should stop pursuit of AZN, since deal doesnt make sense strategically and would shackle company to what is probably the worst-positioned major global drug company based on projected revenues and profits in the coming years; Cautious on R: Shares have outperformed the broader market, but at their current price the stocks valuation has caught up with its growth prospects.
Mutual Funds: Interview with Andy Acker, Manager, Janus Global Life Sciences (top ten holdings: GILD, AET, ESRX, JNJ, CELG, BIIB, Roche Holding, VRX, AZN, NPSP).
European Trader: Positive on Bankia: Spains so-called bad bank could be about to come good for investors, with shares climbing 20% in the next 12 months as management overhaul provides a solid foundation for future growth.
Asian Trader: Positive on Softbank: Investors looking for a way to play Alibaba are better off with telecommunications giant than with YHOO, and its $57 possible profit on Alibaba IPO could set a record.
Emerging Markets: Li Ka-shing, Asias richest man, has been selling Chinese real estate stocks, including large holdings in tier-one cities such as Shanghai and Guangzhou; for small investors, only those willing to wait for a correction should venture into the sector.
Commodities: After two years of decline, titanium prices appear to have reached rock bottom. CEO Spotlight: Profile of KKRs Henry Kravis and George Roberts, who say if they were starting their firm today they would focus on smaller real-estate deals, not private equity.
Streetwise: GS strategist David Kostin screened for companies that have spent less on capex relative to sales during they past five years than they did during the previous five (Positive on COP, SHW, ORCL); Some sectors are seeing capital spending opportunities that are simply too good to pass up.