The rest of 2011 may be tough sledding for stocks and the economy, but Dan Morris, portfolio fund manager at Manor Growth Fund (MNRGX) still sees attractive values on both the high and low end of the retail market, holding companies like Coach (COH) and Dollar Tree (DLTR).
"It's surprising. These high-end retailers seem to do well, even in tough market environments. We have owned Coach for a while and we still think it's well positioned," Morris said.
The $4.3 million fund, which garners 4 of 5 stars from Morningstar (MORN), has returned 11% over the past year, better than 71% of its peers in the large growth category. Over the past three years, the fund has returned an average of 3.3% annually, outpacing 81% of its Morningstar rivals.
Another one of Morris' top picks is DirecTV (DTV), which is known for its popular NFL football package. Morris sees the stock continuing to heat up, even as consumers cut leisure spending in other areas. Morris also likes DirecTV's international expansion into Latin America.At the other end of the retail spectrum, Morris is a fan of Dollar Tree. "It's had a good run here though, so the stock price has gone up a little bit. But we still think that consumers want to head to that end of the market too. So we have a little bit of protection there," Morris said. But no matter where consumers will be spending their dollars, Morris sees consumers increasingly using credit cards to pay for their purchases which is why he owns shares of MasterCard (MA), which generates income from transactions, not dollar volume.
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