Investing in Companies with Great Leadership: Solid Management of Cash-Rich, Debt-Free Companies Important to Long-Term Value Investors

Wall Street Transcript

67 WALL STREET, New York - March 14, 2013 - The Wall Street Transcript has just published its Investing Strategies Report. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

Topics covered: Long-Term Investing - Value Investing - Longer-Term Investing - Bottom-up Investing - Global Investing - High Quality Companies - Investment Strategies -

Companies include: Exxon Mobil Corp. (XOM), Chevron Corp. (CVX), FedEx Corporation (FDX), United Parcel Service, Inc. (UPS), Google Inc. (GOOG), Apple Inc. (AAPL), NVIDIA Corporation (NVDA), Corning Inc. (GLW), Charles Schwab Corp. (SCHW), Wal-Mart Stores Inc. (WMT), Costco Wholesale Corporation (COST), Family Dollar Stores Inc. (FDO), Expeditors International of Wa (EXPD), Automatic Data Processing, Inc (ADP), Bank of America Corporation (BAC), Paychex Inc. (PAYX), Amazon.com Inc. (AMZN), Nokia Corp. (NOK), CBS Corporation (CBS), Martha Stewart Living Omnimedi (MSO), The New York Times Company (NYT), The Coca-Cola Company (KO), Cracker Barrel Old Country Sto (CBRL), Mosaic Co. (MOS), BP plc (BP), Clean Harbors Inc. (CLH), Potash Corp. of Saskatchewan, (POT), QUALCOMM Inc. (QCOM), Nike Inc. (NKE), Newmont Mining Corp. (NEM), Timken Co. (TKR), DuPont Fabros Technology, Inc. (DFT) and many more.

In the following excerpt from the Investing Strategies Report, an expert portfolio manager discusses his portfolio-construction strategy and his investment philosophy:

TWST: Where do your ideas come from? Do they originate from all the research you do?

Mr. Edgerton: Yes, I listen to the smartest people in the world who follow these companies and then hopefully putting all their knowledge together makes me the smartest guy. I listen to Bloomberg West. I listen to Cory Johnson and Emily Chang; those people eat and sleep technology. They follow the Amazons (AMZN), they follow the Samsungs, the Facebooks, the Apples of this world, and they know what they are doing. But even though they know what they are doing, who knows how much the Galaxy S4 is cut into the Apple 5? Who knows whether Nokia (NOK) is going to survive or not? But I listen.

One of my favorite things I do is to listen to a smart person who makes a lot of sense, they've done the homework on maybe Chevron, they've done the homework on maybe Expeditors. If I can buy that stock, say, 10%, 15%, 20% cheaper than they recommend it, I feel like I've got another leg up. You can read Barron's Roundtable at the end of the year and maybe Scott Black, who is a very seasoned accomplished investor, likes the company and then maybe he buys it at 25%, I buy it at 18%, who is the smartest? That's a matter of opinion.

TWST: You also described yourself as contrarian. What do you mean by that?

Mr. Edgerton: By "contrarian," I mean I buy what everybody is selling. I don't buy anything, any stock, that's at an all-time high. I like to buy a stock that is not working because it's so washed out. For example, four or five years ago, CBS (CBS) got down to $4. Moonves is a smart guy. You got "Letterman," you got "60 Minutes," you got the Masters, the Pro Tour, you got the NFL. And CBS was at $4, and everybody hated the stock. At $4, how much can you lose? The stock is $44 now. I haven't sold a share, but it is all relative. If I bought 1,000 shares of CBS at $4 and maybe it hit my target, and Facebook is down to $20, 2.5 times...

For more of this interview and many others visit the Wall Street Transcript - a unique service for investors and industry researchers - providing fresh commentary and insight through verbatim interviews with CEOs, portfolio managers and research analysts. This special issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

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