Top Picks from Fidelity Asset Management Focused on Construction Industry Trends

Wall Street Transcript

67 WALL STREET, New York - April 14, 2014 - The Wall Street Transcript has just published its Investing Strategies Report. This special feature contains in-depth interviews with highly experienced Money Managers. The full issue is available by calling (212) 952-7433 or via The Wall Street Transcript Online.

Topics covered: Dividend-Paying Stocks - Capital Appreciation - Small Cap Investing - Upside in Small-Cap Stocks - Investing Through Construction Trends - Dividend-Paying Small Caps - MLP Investing - Global Macro Trends

Companies include: The Home Depot, Inc. (HD), EMCOR Group Inc. (EME), AECOM Technology Corporation (ACM), Simon Property Group Inc. (SPG), MasTec, Inc. (MTZ) and many others.

In the following excerpt from the Investing Strategies Report, an experienced portfolio manager discusses his investing methodology and top infrastructure stock picks for investors:

TWST: Can you give us an overview of the investment philosophy and strategy for the Fidelity Select Construction & Housing Portfolio?

Mr. Boerner: The portfolio is primarily centered on industry trends related to housing, residential and commercial construction, and global construction and engineering themes, which include subsectors such as oil and gas exploration and other industrial subsectors. I look for stocks that are in some way performance-related or influenced by trends in those sectors. As of January 31, that exposure is primarily centered on domestic names, and I try to run this fund as a reasonably concentrated portfolio.

My strategy is essentially focused on finding names where the mid and peak earnings potential is not currently reflected in the share price. It's my view that over the last 12 months or so, as the market started to figure out that the housing recovery has inflected and started to improve, most of the easy money in stocks that were trading at beaten-up valuations has been made.

I'm therefore more focused on trying to find higher-quality names with a number of qualities, including differentiated business models that are able to demonstrate above-average earnings growth over the next 12 to 24 months and that usually have a quality bias with respect to management, the quality of their portfolio, their business strategy, and also the quality of their financial capacity and balance sheet. Those companies I think will be able to either fund external growth acquisitions, for example, with their balance sheet without having to raise capital, or they will focus on returning some of their capital to shareholders in the form of share buybacks or dividends...

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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