Money manager extraordinaire Mario Gabelli is a bull on financial stocks, particularly money managers.
“My favorites are the money managers,” he tells Bloomberg TV. “Because you have $60 trillion in fixed income and $30 trillion of equities, $90 trillion” all together, Gabelli says.
“Somebody has to figure out how to manage that asset, and over time that asset base will grow. In my judgment, equities are going to grow in the eight to 10 percent area.”
And what names does Gabelli like in that space?
“You have T. Rowe Price, which is an extraordinarily well-managed company, really smart, conservative, but yet they’re intelligent investors,” he says.
“I wish that Capital Research and Fidelity were public, but T. Rowe would be a good choice. Waddell and Reed; Janus in the in the growth area, growth stock comeback. Janus will do well.”
Gabelli also sees opportunities among banks.
There are “going to be fewer loans, less leverage, more conservative, but better yield spreads, less loan reserves, so they’ll make fairly good money,” he says.
“And then you get who are the smart guys out there?” Gabelli lists Jamie Dimon, CEO of JPMorgan Chase, and John Mack of Morgan Stanley. He also likes Goldman Sachs, Bank of New York and Northern Trust.
Other experts have mixed views on the banks. Dick Bove says first-quarter earnings prove they’re bouncing back, while Meredith Whitney says losses in credit cards and other areas are just starting.
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