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Stocks struggled to gain Thursday, as a handful of positive economic news barely budged the market after FedEx posted disappointing results—but raised its outlook. John Morris, managing partner at Crestwood Advisors and Sarat Sethi, partner and portfolio manager at Douglas C. Lane & Associates shared their insights.
“We’d say we wouldn’t want to own the broad market because we think operating margins right now, which are at around 9 percent, will decline to a historic norm, which is closer to 7 percent,” Morris told CNBC.
“So we’re looking at below-trend earnings growth across the broad market.”
Instead, Morris advised investors to look at industries and companies with "unique models, good pricing power and good dynamics" that will lead them higher for the next five years.
In the meantime, Sethi recommended that investors be “all about diversification.”
Morris Likes:
McCormick —“They’ve got pricing power, oligopoly business, pays 2.5 percent dividend and has a shareholder-friendly management.”
WisdomTree Emerging Market Local Debt ETF—“We can earn a 4 percent current income…and it gives us foreign currency exposures.”
Fairfax Financial
Sethi Likes:
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