Gue and George Look to China

02/14/2003 12:00 am EST

Focus:

Neil George

Editor-in-Chief, Income Publication and Products, Agora Financial

Despite maintaining generally bearish market outlooks, both Elliott Gue, editor of Wall Street Winners, and Neil George, editor of bygeorgenewsletter.com, have the uncanny knack of isolating intriguing stocks that are not subject to the vagaries of the domestic markets. They both include a focus on global bonds, natural resources, and select companies that are well-positioned to buck a negative trend. Both recently offered ideas that benefit from expected growth in China.

"If you do want to own shares in the PC market, I'd suggest a competitor of the domestic PC makers," says Neil George, editor of the bygeorgenewsletter.com, "That's Legend Holdings (LGHLY NASDAQ). Sales are rising at rates of near 50%, while margins are improving and operating income is doubling. Legend is domiciled in China, a market that's showing sustained hefty demand for its PC products. While Legend isn't a household name, in Asia and particularly in China, it's one of the most recognized brands of nearly any retail product company."

"A recent portfolio addition is the Chinese oil company, CNOOC (CEO NYSE)," says Elliott Gue, editor of Wall Street Winners . "The company is the only one permitted to conduct exploration and production activities with international oil and gas companies in offshore China. CNOOC engages primarily in the exploration, development, and production of oil and natural gas. High oil prices have loaded the company with huge amounts of cash, so it is experiencing strong free cash flow and high return on earnings of 20%. A good pick for diversification, CNOOC is a buy below 30."

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