Hi RFH, You're lucky! I saved the Paine Webber article.
Edward Kerschner is PW's chief investment strategist. He's always been interesting. He talks about a New Profit Pattern in this article.
He says there's to be less volatility in the economy for two reasons:
1) industrial sector mini-recessions
2) global recession "rotation"
He names four type of "Nouveaux Cyclicals":
--Capacity Cyclicals - he feels the supply/demand balance looks favorable for airlines, papers and semiconductors, but not chemicals or energy.
--Demand Cyclicals - customer and consumer spending determine demand and drive this group. Economic growth is good for autos, diversified industrials, railroads and retailers but low demand is bad for agricultural equipment.
--Growth Cyclicals - Rebound of the global economy should help telecommunications equipment, computers, household products and specialty chemicals.
--Credit Cycle stocks - Brokers, banks and other financials have their earnings tied to what he terms the "rhythms of Wall Street." He feels that the opening of Japan's financial markets and the Asian rebound should help certain US financial service firms.
Here's their BUYS for each area"
Capacity cyclicals - AMR, BOW, SSCC, WLL, INTC and TXN
Demand Cyclicals - BBBY, GPS, with "attractive" ratings on ITW, BNI, UNP and WMT
Growth Cyclicals - IBM, SUNW, NOK with "attractive" on AVP, G, APD, ECL, MIL, NLC, PX and ERICY
and finally
Credit Cyclicals - No BUYs, but "attractive" on AFL, AXP and AIG
Lots of recognizable names and symbols. I don't know how to feel about any of them other than to say that many have shown AIM-like characteristics to me before.
Have fun!!
Tom
Best regards, Tom |
