Shares of Jacobs Engineering (JEC) are up 18% in the past week thanks primarily to the election of Donald Trump. Arun Daniel, portfolio manager for the JOHCM U.S. Small Mid Cap Equity Fund, said investors can keep building their position in the stock because it has room to run.
"Jacobs Engineering is at trough earnings and getting ready to accelerate on the top line while it is simultaneously benefiting from restructuring on the top line," said Daniel.
The JOHCM U.S. Small Mid Cap Equity Fund is up 12.3% thus far in 2016, according to Morningstar. The $5.6 million fund has returned an average of 13.6% over the past 12 months, outpacing 98% of its rivals in Morningstar's mid-cap growth category. The fund sports a trailing 12 month yield of 28 basis points, according to Morningstar.
Daniel is also bullish on Martin Marietta (MLM) , also benefiting from the election of Donald Trump; shares are up 13% since the election. The seller of granite, limestone, sand and gravel is up over 63% year-to-date although the company missed Wall Street earnings estimates when it reported third quarter results earlier this month. The company said it had profit of $2.49 per share versus the consensus forecast of $2.64 per share.
"Martin Marietta is benefiting disproportionately from its 20% exposure in Texas, which is down this year but should recover with energy prices," said Daniel.
Hasbro (HAS) , up 27% year to date, is another one of Daniel's top picks. The toy company posted a strong third quarter last month thanks largely to its lucrative partnerships with Walt Disney (DIS) . Hasbro's revenue rose more than 14% in its third quarter while its operating profit grew more than 19%, and adjusted earnings per share jumped more than 28%.
"Hasbro will enjoy the benefits from its strong film slate next year," said Daniel. "All of Disney's major films are tied to Hasbro and they are expecting a big 2017. So its more than just this holiday season for the toy seller."
Finally, Daniel is a fan of Nordstrom (JWN) , up 17% year to date, heading into the holiday season. Last week Nordstrom reported a 7.2% increase in total sales to $3.54 billion, topping analysts' expectations for the period. Earnings of $0.84 a share easily topped Wall Street's expectations. Same store sales rose 2.4% year over year, matching analysts' expectations while the company's off-price Nordstrom Rack segment reported nearly 4% same store sale growth.
"Nordstrom has 40% of its revenue coming from outside the mall and this is often overlooked," said Daniel. "That part of the business is growing in the double digits, especially its online business which is 20% of the company's overall sales."