Olstein Fund Bets on Consumer: Five Spot

MILWAUKEE (TheStreet) -- Eric Heyman, co-manager of the Olstein Strategic Opportunities Fund(OFSAX), says it's a good time to be "skeptically bullish." He expects companies that make consumer discretionary products to gain as the economy improves.

The fund has risen 31% this year, better than 90% of its Morningstar(MORN) rivals. Over the past year, it has fallen 15%, better than 82% of its Morningstar peers.

Welcome to TheStreet.com's Fund Manager Five Spot, 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?

Heyman: As bottom-up value investors with a long-term investment horizon, we're typically neutral about the market's overall direction. That being said, in light of the extreme volatility we've experienced over the past 12 months, we do believe the market will continue to settle down with further rehabilitation of credit markets and a reduction in unemployment. But we're pleased the market has once again begun to focus on individual company valuations, so you can call us skeptically bullish.

What is your top stock pick?

Heyman: One area in which we have historically done well is identifying corporate turnarounds. A company that we believe is in the process of successfully transforming itself is Teleflex(TFX). Beginning in 2007, management has transformed Teleflex from a diversified industrial products and medical company, to a company that now derives 70% of its profits from medical devices and surgical instruments. We believe Teleflex is an undervalued medical products company capable of generating over $5 per share of free cash flow in 2010.