Rebuilding a powerful portfolio.Larry Folmar believes tech stocks could make a strong comeback Despite enduring a stock market that could conjure nightmares for macabre master Edgar Allan Poe, it may well be time for investors to reenter re·en·ter also re-en·ter v. re·en·tered, re·en·ter·ing, re·en·ters v.tr. 1. To enter or come in to again. 2. To record again on a list or ledger. v.intr. , retool re·tool v. re·tooled, re·tool·ing, re·tools v.tr. 1. To fit out (a factory, for example) with a new set of machinery and tools for making a different product. 2. , and reposition themselves in the stock market. "Technology stocks are poised for a comeback and at these prices everyone should buy back a significant position," advises Larry E. Folmar, president and chief investment advisor Investment Advisor 1. A person making investment recommendations in return for a flat fee or percentage of assets managed, known as a commission. 2. For mutual fund companies, it is the individual who has the day-to-day responsibility of investing and monitoring the cash and of the Folmar Financial Group, a Southfield, Michigan-based investment firm. Sound risky? Folmar believes investors should take some calculated chances--they shouldn't be reckless, but definitely aggressive. The roundup Folmar gives for this Private Screening can produce a comforting yield if investment pundits' target prices are on par. What follows are his top five picks. Ford Motor Co. (NYSE NYSE See: New York Stock Exchange : F) is the world's second-largest automaker. "It's always been a good company to hold," says Folmar. "Although the automotive industry The automotive industry is the industry involved in the design, development, manufacture, marketing, and sale of motor vehicles. In 2006, more than 69 million motor vehicles, including cars and commercial vehicles were produced worldwide. is facing challenges, Ford will emerge a victor." Another plus: When interest rates decline, auto stocks typically benefit. Furthermore, Ford is currently in the middle of a $5 billion buyback which always impresses investors. Lastly, Ford offers investors a higher dividend yield (3.9%) than its counterparts. Add that to the present dividend, and stockholders should gain about 11%. Oracle Corp. (Nasdaq: ORCL ORCL Oracle (stock symbol) ), the $10.1 billion giant, is in a battle to unseat Microsoft from the throne. At a low of $16 in early May, the No. 2 software developer for information management could realize significant earnings growth. "Besides, it's a good new economy stock ... and we're in a new economy," says Folmar about the Redwood City Redwood City, city (1990 pop. 66,072), seat of San Mateo co., W Calif., on San Francisco Bay; inc. 1868. Manufactures include commmunications, electrical, electronic, and medical equipment. , California-based tech titan. Delphi Automotive Systems See ITS, embedded system, drive-by-wire, adaptive cruise control, collision avoidance system, autonomous vehicle, heads-up display, DSRC, lane departure system, CAN bus, FlexRay and SYNC. Corp. (NYSE: DPH DPH Diploma in Public Health. DPH abbr. 1. Diploma in Public Health 2. Doctor of Public Health 3. Doctor of Public Hygiene ) hails as the world's No. 1 auto parts supplier. This company makes virtually everything mechanical or electrical that goes into cars, ranging from brakes to engines. The $29.1 billion Troy, Michigan-based firm is a bargain stock at $14.61 (as of April 20), says Folmar. Cisco Systems (Nasdaq: CSCO CSCO Cisco Systems Incorporated (stock symbol) CSCO Chief Supply Chain Officer ) is a household name now, and at $17 it's within the household budget. This $19 billion San Jose, California-based firm controls more than 66% of the global market for routers and switches that link networks and power the Internet. Expect demand to be robust for the firm's Internet-access products. Pfizer Inc. (NYSE: PFE 1. (text, editor) PFE - Programmer's File Editor. 2. (language) PFE - Portable Forth Environment. ) makes Viagra, which is a favorite among aging baby boomers and some recreational users. The drug remains the company's big winner. Aside from it's treatment for impotency, the $29.6 billion pharmaceutical mammoth has other concentrations including new drugs for schizophrenia and cardiovascular disease Cardiovascular disease Disease that affects the heart and blood vessels. Mentioned in: Lipoproteins Test cardiovascular disease . And, another plus for Pfizer's schizophrenia drug, Geoden, is that unlike its peers, is already on the market and doesn't make patients put on excess weight. Consumer brands like Visine, Listerine, BenGay, and Certs will likely continue to boost profits.
Folmar's comeback kids
Company 12-Month P/E on Projected
Exchange: Symbol Price(*) Price Target 2001 Earnings
Ford Motor Co. $29.70 $35 11.0%
NYSE: F
Oracle 19.75 28 39.0
Nasdaq: ORE
Delphi Auto. Systems 14.61 17 19.2
NYSE: DPH
Cisco Systems 19.15 30 42.5
Nasdaq: CSCO
Pfizer 40.76 56 33.2
NYSE: PFE
Est. 5-Yr.
Company Annual EPS
Exchange: Symbol Growth Why Stock Will Outperform
Ford Motor Co. 6.9% * Pundits predict it's in a better
NYSE: F position to weather any
downturns in the auto industry.
Recent buybacks will bolster
stock price.
Oracle 22.9 * Should continue to do well in
Nasdaq: ORE Web-based applications market.
Delphi Auto. Systems 8.2 * Expansion should bode well for
NYSE: DPH future earnings.
Cisco Systems 30.2 * Controls two-thirds of the
Nasdaq: CSCO global market in its category.
Pfizer 22.0 * Supply and demand. Recent FDA
NYSE: PFE approvals for new drags are
expected.
(*) As of 4/20/01. Prices are adjusted for stock splits and dividends.
Source: Larry E. Folmar, The Folmar Financial Group; Zacks Investment
Research; Yahoo! Finance.
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