Charge Into MasterCard, Broadcom, Says Fund Manager
More and more consumers are using plastic for their purchases instead of cash, and that bodes well for MasterCard (MA), says Matt Glaser, portfolio manager for the Turner Spectrum Fund (TSPCX). Nevertheless, while he likes the credit card business, Glaser is not bullish on the entire financial sector, taking a short position in companies with heavy exposure to banks and brokerages.
"MasterCard is essentially an oligopoly. There are only a couple of companies in the world that have dominant share in this area," says Glaser.
The $623 million fund, which launched in May 2009, has returned 5.5% over the past year, better than 83% of its peers in Morningstar's long/short category.
On the long side, he also likes communications chipmaker Broadcom (BRCM) as a result of the company's broad exposure to wireless headsets, smartphones and tablets. Aside from Broadcom's expanding end markets, Glaser also likes the stock's valuation, which he says is cheap at around 12 times next year's earnings.On the short side, Glaser is betting against healthcare companies with large exposure to Europe, as well as firms supplying the struggling financial services industry. "Obviously the financial services industry is under stress. And we think earnings will decelerate at those companies that derive a significant portion of their revenues from banks and brokers, whether they are selling research services or data services," says Glaser.
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV