10 Questions: At Charles Bath's New Value Fund, There's No Room for Tech

When did you pick that stock up?

A couple weeks ago -- when the third quarter was reported. One of their competitors reported earnings and orders before Trinity did. When they started reporting quarters that were very strong, is when I started buying Trinity.

7. Two other recent additions are ConocoPhilips(COP Quote) and Centex(CTX Quote). What do you like about them?

Centex is a homebuilder. I think people are overly concerned about home building. I think, in part, because everyone's focus is on the high end and that's because in money management, that's the type of home everybody's in. But in Middle America, the housing market is quite healthy -- driven by low interest rates. I see no reason to be overly concerned about it. You're always concerned about a cyclical business, but I see no reason to be overly concerned about the homebuilding business.

But it's trading at six times earnings and barely above book value, that's a pretty attractive evaluation to me.

A lot of people have voiced concerns about the homebuilders -- the rising cost of land, the slowing market. Do you like the sector across the board or is Centex the exception?

Centex is my only homebuilder. I think it's the best in the group, but others may differ. Across the board, they're all relatively cheap. They all reflect concerns about a housing recession, which I don't think is going to happen. But if a housing recession does happen, valuations are cheap enough that you shouldn't be hurt too badly with the stocks.

How about Conoco Philips?

I find the energy stocks, in general, a bit underappreciated. I hope we don't go to war with Iraq, but everyone knows it's a possibility. People have shied away from them. The thought process was: The last time we went to war with Iraq, oil prices went down and it was bad on the energy sector. I feel that supply-demand outlook is much more favorable in the industry this time than it was last time. Perhaps on a near-term basis energy prices will weaken, but I think the fundamentals of the industry were much better than they were last time. Conoco Philips is one of the cheapest integrated energy companies.