With the stock market down 9 percent from its April highs, now is a good time to buy value stocks, says Robert Olstein, manager of Olstein All Cap Value fund.
His biggest holdings are blue chips Intel, Microsoft, Macy’s, Xerox, DuPont, Radio Shack, Alliance Bernstein, Home Depot, Legg Mason and Ingersoll Rand.
“In this market, the pickings for a value investor are easy,” Olstein told The New York Times.
Some individual investors are bailing out of stocks, discouraged by 10 years of negative returns. That puts bargains on the table, he says.
“The frustration from decade-long negative returns from owning equities has overtaken reason when bargains exist across the board, especially in the most respected companies in corporate America,” Olstein said.
“The only reason you ever get value is when the masses disagree with you or don’t see the value that you see.”
His picks have strong cash flow, which will boost their share prices, as the companies implement stock buybacks, higher dividend payouts and mergers and acquisitions.
Olstein’s fund has topped the Standard & Poor’s 500 Index by nearly three percentage points a year since its inception in 1995.
Not everyone is so bullish on the stock market. “We’ve got about 7 more years to go [on the lean cycle],” Cashin, director of floor operations at UBS Financial Services told CNBC.
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