3 Blue Chips with Insane Value


John Buckingham Image John Buckingham Editor, The Prudent Speculator

A number of large-cap stocks have spent the last decade in the doldrums, but have emerged with better numbers and incredibly low price/earnings ratios. In this exclusive interview with MoneyShow.com, John Buckingham, chief investment officer of Al Frank Investment Management, shares his top sectors and stocks to watch.

Are you looking at any sectors that would appreciate in the sweet spot of the economic recovery?

Well, in our portfolios we’re underweight financials, and we’re there because we’re having a difficult time trusting the numbers.

It’s not that we don’t believe management. That has nothing to do with it. It’s just that it’s hard to know what the next level of reserves will be if you’re a bank.

Have they written off enough? Next quarter, are they going to do 2X instead of 1 1/2 X in terms of their writeoff? So, financials were underweight.

We’re a little bit overweight in technology. I do like a lot of the tech names, especially some of the bigger cap tech names, like a Microsoft (MSFT), believe it or not. I know a lot of people don’t like Microsoft, which makes me very happy, but you have a P/E ratio of ten, you have a great balance sheet, you have a monopolistic business, and you have a nice dividend yield.

Intel (INTL), another name which actually has a 3% yield and a ten P/E.

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