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Technology Stocks : The New Qualcomm - a S&P500 company -- Ignore unavailable to you. Want to Upgrade?

To: marginmike who wrote (267)	7/27/1999 11:54:00 AM
From: LBstocks	Respond to of 13582

Putnam Global Growth Fund on QCOM> Mutual Funds Jul 27, 1999 Putnam Global Growth: Searching for Bluechips by Shannon Turner 7/27/99 Special from worldlyinvestor.com 'In the U.S., classic large cap growth stocks have been doing well, and we think that growth outside the U.S. is also being recognized,' says Lisa Svensson, senior vice president and portfolio manager of the $6 billion Putnam Global Growth Fund (NASDAQ:PEQUX) . The fund is structured to participate in blue chip growth stocks both inside and outside the U.S. Svensson and her co-managers are looking for stocks with superior revenue growth, high return on equity, and above average earnings growth. Founded in 1967, the fund's class A shares have a 10-year average annual return of 13.23%. Five-year average annual return is 16.35%. In 1998, total return was 28.8%, and year-to-date through July 22, the fund is up 9.6%. From a universe of 11,000 stocks, Svensson and her team of six narrow that number down to 1,000 by screening for 'true growth stocks where the growth is from an organic level.' These candidates are then ranked according to such factors as price and earnings momentum and return on cash invested. This whittles the number to about 500 'investable' stocks. 'Fundamental research is a key ingredient in the process,' she says. And on top of research, visits to management trim the list to about 150 stocks, give or take a few. From a growth prospective, Svensson loves the telecom equipment business. In the U.S., she likes Lucent (NYSE:LU - news) and Qualcomm (NASDAQ:QCOM - news) . But the fund's biggest position is Nokia (NYSE:NOK - news) . 'Based on our early research, we were aware that the idea of wireless penetration would grow,' says Svensson. With the developments the company has made in wireless data transmission, she's finding that there is a whole new profitable area such as short messaging and data processing that you can do all from your mobile phone. The Internet boom has led many portfolio managers to seek similar opportunities outside the U.S. and Svensson is no different. The fund's approach is to buy into broadband and a company such as the UK's Telewest (NASDAQ:TWSTY - news) is very well positioned to offer high speed Internet access. In Japan, Svensson likes Softbank. 'This portfolio of Internet investments has been ahead of most everyone by providing financing to Internet companies,' says Svensson. Softbank owns positions in Yahoo! (NASDAQ:YHOO - news) and E*Trade (NASDAQ:EGRP - news) . 'I see no reason why the Internet can't catch on in Japan. There are lots of possibilities for e-commerce that are attractive to Japanese consumers,' she says. Along that line of thinking, Svensson owns CMGI (NASDAQ:CMGI - news) , which is similar to Softbank, and she likes Charles Schwab (NYSE:SCH - news) for its Internet brokerage capabilities. Another group that Svensson is excited about is the information technology service sector. Just like IBM (NYSE:IBM - news) became more service and software oriented, she says there are companies out there that are already in that business without the drag of hardware. A couple names she lists are UK firms, CMG and Sema Group. Another pick is Cap Gemini. One information technology firm she likes in Japan is Fujitsu Support and Services. Japan is even further behind in the trend toward outsourcing, but this spin-off of Fujitsu has a great backlog of business. Svensson thinks it's interesting that early in the year, the team started to recognize that there were several new companies developing in Japan. One new favorite is Hikari Tsushin. The stock is up 489% since the beginning of the year. Its bread and butter business is selling cellular. 'They are right in the middle of this exciting trend of data transmission,' she says. The company also offers Web hosting services and e-mail to businesses. Minimum investment in the fund is $500. Class A shares have a front load of 5.75%. Class B shares have deferred loads, higher 12b-1 fees and conversion features. Class M shares have lower front loads and higher 12b-1 fees. © 1999 Worldly Information Network, Inc. All Rights Reserved.