Michael Sansoterra, a managing director at Silvant Capital Management and portfolio manager of the RidgeWorth Large Cap Growth fund (STCFX), is a bright and articulate guy who thinks the roughly 7% pullback in the S&P 500 is a buying opportunity. He has a list of stock picks from his favorite sectors right now: Tech, consumer discretionary and industrials.
Since this site is about making you money, I'm just going to run through Sansoterra's stock ideas one by one and tell you what I think. Manners are in the kiddie seat, my id's going to drive this one.
Buckle up and let's roll:
Baidu (BIDU): Sansoterra likes Baidu, the "Google of China," saying the company faces no competition due to the oppressive Chinese government.
The "Google of China" label is damning Baidu with faint praise. Baidu is better than Google (GOOG), and it's a monopoly. The downside is the fact that the Chinese government will pull a "reverse merger" with Baidu at the slightest provocation. The upside is Baidu won't come out with a product line of pure idiocy like Google's new "Chromebook" laptops which amount to an iPad with a lid. When I was in business school, Larry Ellison of Oracle (ORCL) gave an awesome speech on dumb computers operating off the Internet. That was 1997.
BorgWarner (BWA): Sansoterra likes this consumer discretionary company that makes pumps for cars because there's a secular trend of drivers looking for ways to get better mileage.
With oil prices falling and unemployment over 9%, you have to be a little bit high to think new car demand is poised to explode. Used cars? Maybe. New cars with turbo chargers? Not in my opinion. BorgWarner has an agriculture kicker, but I'd rather play Caterpillar (CAT) if I didn't think the cyclical names were poised to cycle lower.
BE Aerospace (BEAV): Sansoterra says airlines are upgrading their interiors.
No, airlines aren't upgrading their interiors. What's more, judging by Boeing's Dreamliner there are about four new planes coming on-line per year, not counting Diddy's G-7s. Air transportation is arguably the world's worst industry, featuring the most awful aspects of both the public and private sectors. Whenever an airline has 50 cents to rub together it spends it on a hostile takeover, resulting in a oligarchy of bad businesses competing on price and treating customers like chattel. There are about three airlines left, and one of them is Southwest (LUV), which keeps its planes ratty by design.
New interiors? When the airlines stop charging me $3 for a Diet Coke, I'll believe they're going to do something about fixing my old, cramped seat on their dime.
Las Vegas Sands (LVS): Sansoterra says casino stocks are all about Macau, China.
It makes a lousy conclusion to this particular column, but I pretty much agree.
Michael Sansoterra goes two for four by my scorecard, picking winners with Baidu (BIDU) and Las Vegas Sands (LVS). Let me know how you're voting in the space below or via email: email@example.com