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How To Invest Right Now

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  • Description

    Chad Morganlander of Stifel Nicolaus weighs in on the state of the markets.

  • Duration 3:57
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You are most vocal about the market seemed to like today's slew of economic reports and overall pretty good although jobs will talk about that -- guess as we've not out of the woods yet.

So how should you invest right now it's a -- one joining us now chat Morgan -- a portfolio manager was -- -- and Chad thanks for being with us.

I mean it just seems like this market just continues to want to move higher and higher and higher and every day we hear from people.

Not as a pullback coming as a pullback coming because we need it and when do we get a pullback do you think and and by how much.

Well you gonna have a string right now -- had a string of good economic data points have come out yet and that has bolstered investors' enthusiasm.

And you probably gonna continue to see that the next several months so we're continuing to be overweight equities at this point in time in -- one should keep in mind.

That earnings.

Has not translated.

Into a great burst -- when I say that I mean 2% kind of earnings growth this year year over year -- so you could expect perhaps the S&P 500 to go to 15150.

-- 15175.

But at that point in time we would be somewhat more cautious.

-- -- but you make -- great point because the market is moving much faster than earnings basically.

Right but yet they seem -- -- companies are leaning mean they are waiting to die back in so arguably if they ever get that opportunity we don't even hot air.

Well that's true that if you get its trends not a capital spending -- and you get.

Good positive private sector growth on the employment numbers then you could have a lot of room to run.

But you really need to see -- feedback loop into the earnings for the market to really move higher.

And you have operating margins for of US corporations act peak historical peak.

And revenue growth that is somewhat lackluster.

-- you know what you wanna do huge -- -- see somewhat more balanced he's somewhat overweight though a little bit inequities beatle wanna get too over your skis.

And think that now is to time to you know be fully invested because you -- see a brief war.

Five year kind of real big bull run without a market pullback but we are seeing a flow out of the bond market in particular.

People who want to say okay.

I'm five.

Popped my money with basically no yield for so long.

There is that pent up demand but there is that kind of conundrum of what do like go into the market now by just totally missed this.

So this flow that you're speaking about Ethel what is and one month kind of move into equity mutual far right Andy -- of historic proportion.

You when you go back and you look to -- time.

But you really need to see a two month three month performance kind of trend I don't suspect that's gonna come to fruition.

I don't think that we're here at it with -- in regard to US economy will you hit this speed velocity prospective.

Which is a fancy word for economic growth of 3% of or -- 0%.

-- about being in this market you like technology and Oracle on your list many say -- actually Oracle Cisco doesn't -- studies slow instead he's they're selling below market multiples.

-- Oracle.

We have a price target there of over forty dollars a share.

-- you can -- -- good 10% return plus pick up and did some dividend yield.

As well I Cisco selling at a twelve times multiple growth trajectory again on it on a price appreciation standpoint of over 10%.

So these are slowing studies have a lot of cash they're consistently growing consistently profitable well capitalized.

And those are three things you want to look at look for for companies.

If it this 2013.

What are you avoiding chat.

All right now I would be avoiding utilities I do believe that.

You're going to see interest rates slowly rise over the next eighteen months so you gonna see money flow out of that.

Into more slow and steady companies like technology.

Great stuff good stuff good information chat Morgan landed with Stifel -- at thank you -- -- -- here at one.

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