In an environment of stagnant growth and screaming market reversals it's good to know that some stocks and companies never go out of style. At least that's the case of BMT Asset Mnagement's Chip Cobb. Chip came on the show to sing the praises of Philip Morris International (PM), apparel manufacturer V.F. Corp (VFC), and the ancient yet somehow still relevant AT&T (T).
Nesto and I, being the type of guys who would happily take the other side of someone's claim that a cloudless sky is blue, were more than happy to take Chip Cobb to task on every name. It didn't hurt matters that I don't own any of the stocks. Cobb (no relation to "Ty" though his son is named Tyrus) hung in just fine and parried our every thrust.
Watch the video for the details; here's the gist of his bullish case for each:
Philip Morris International (PM)
The international spin-off of "Altria" (MO), a name I refuse to say without air-quotes, PMI is up a smokin' 45% in the last 12 months. Cobb is looking for more based on the growing business and isn't concerned about regulatory headwinds increasing in foreign markets. Even if he were wrong, growth and a PMI's greater than 3.5% yield would ease his pain.
V.F. Corp (VFC)
The maker of Lee Jeans, Timberland footwear and North Face outdoor gear has ripped over 50% higher since last summer, and like he does with Phillip Morris, Cobb is looking for more. I shot out the normal concerns about input costs, particularly cotton in the jeans, but Cobb was cool as a cucumber. Not only does V.F. Corp catch a break because of the more synthetic nature of boots and coats versus jeans, but VF's "cash-flow is very special." Another dividend, another screaming gain and I actually picked the stock a few weeks ago on FBN's Follow the Money. In other words, if you're looking for all that much criticism you're barking up the wrong tree.
Ok... this one I'm not so crazy about. Cobb refers to Ma Bell as a technology company which will benefit from Cloud Computing. Even if the phrase "Cloud Computing" didn't make me do a spit-take at this point I still would have questioned exactly how real the Cloud trend is and why AT&T would stand to gain. Watch the video to hear the answers as I jump to criticism #2: Didn't these guys ridiculously over-pay for T-Mobile and, as Nesto questioned, is Cobb "going to vote his shares" in favor of the deal. Yes and Yes. Cobb says AT&T overpaid but the T-mobile user base is worth the binge.
Despite our best efforts Cobb hung tough and gave reasonable seeming answers. We want to know what you think, as always. Drop a comment below or contact us via email at: BreakoutCrew@Yahoo.com
- Philip Morris International
- Cloud Computing