Five Spot: Frantzen Sees Second-Stage Rally

Michael Via, chief investment officer at Tampa, Fla.-based Frantzen Capital Management, said stocks will get a second wind as institutional investors pour money into the market.

The Frantzen Large Cap Growth Fund and Frantzen Small Cap Growth Fund, started as separately managed accounts, are now available as mutual funds. They're rated five and four stars, respectively, by Morningstar. The highest rating is five stars.

Each fund has fallen 43% in the 12 months through March 31. In comparison, the Russell 2000 Growth Index, measuring small caps, has declined 36%, and the large-company Russell 1000 Growth Index has dropped 34%. The benchmark S&P 500 Index has retreated from a 2009 high of 929 reached earlier this month after hitting as low as 677 on March 9.

Frantzen Large Cap Growth Fund's three largest holdings are McDonald's(MCD Quote), Wal-Mart(WMT Quote) and IBM(IBM Quote), according to the company's first-quarter report. The small-caps are MasTec(MTZ Quote), Open Text(OTEX Quote) and Valmont(VMI Quote).

TheStreet.com's Fund Manager Five Spot is where America's top mutual fund managers give their best stock picks in five fast and furious questions.

Are you a bull or a bear?

Via: Despite the recent upturn, we are still bullish. Much of the rally has been the result of bottom fishing and retail accumulation of the more beaten-down stocks. A record amount of institutional money still sits on the sidelines. When this money is put to work, money managers will likely be buying higher-quality stocks with solid fundamentals and earnings growth. As a result, we see a second leg to the rally that is led more by market leaders as institutional investors cannot risk losing further upside by remaining in cash.

What is your top stock pick?

Via: We have recently added Atwood Oceanics(ATW Quote) to the Frantzen Small Cap Growth portfolio. Atwood has never missed a beat, consistently growing its top line through a global recession and volatile energy demand and prices. An offshore driller, the stock has traded down with the price of oil despite rising earnings and earnings forecasts. A price-to-earnings multiple in the low single digits further adds to the appeal. We believe the stock has substantial upside price potential even with a leveling off in energy prices.