A MAKER OF PRESSURE-CONTROL EQUIPMENT FOR oil and gas production
supplied lots of power for the portfolio that Calvin H. Baker chose in
March of 2007. But while Cameron International Corp. rose 48% for Baker,
a managing director and senior portfolio manager at Baltimore-based
Brown Capital Management Inc. (No. 5 on the BE ASSET MANAGERS list with
$2.71 billion in assets under management), it could not keep the overall
portfolio in the black,
His four stock picks slipped 6.8%, just ahead of the performance of
the S&P 500 indent But Baker, whose firm chooses stocks based on a
3- to 5-year investment horizon, maintains that all of them are keepers.
With a stock split on Dec. 31 and recently trading in the $42
range, Cameron could hit $50 to $55 within a year and a half, he
maintains. Shares of Abbott Laboratories were basically flat, but an
expanding array of uses for its arthritis drug Humira should help lift
its price to $63 within 18 months, Baker says. "The market just
keeps expanding, and the drug is turning out to be a huge success"
But what about insurer American International Group and
handbag-and-accessory retailer Coach Inc., which fell a dizzying 40% and
42%, respectively? Hold on to them, Baker advises. AIG was hurt by
exposure to bad mortgage debt, but the main insurance business is sound,
and the company has plenty of capital. Within 18 months, AIG could move
from a recent close in the $40s to $55, Baker predicts.
Coach has been hurt as consumers have increasingly kept their
purses shut. But its depth of products and overseas
penetration--especially in Asia--should add up to 20% annual growth over
the next several years. It could climb about $4 a share to $35 or more
within 18 months, Baker believes.
Price Price Total
Company (Tidrer) 3/7/07 3/14/08 Return
Abbott Laboratories (ABT) $51.48 $51.38 -0.2%
American International Group (AIG) 68.39 41.18 -39.8
Cameron International Corp. (CAM) 28.88 42.73 48.0
Coach Inc. (COH) 48.22 28.03 -41.9
Total Portfolio
S&P 500 1,391.97 1,288.14 -7.5
Current Value of
$4,000 Investment: $3,661.06
* REFLECTS STOCK SPLITS AND DIVIDENDS
SOURCE: YAHOO FINANCE
COPYRIGHT 2008 Earl G. Graves Publishing Co.,
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