Michelle Leder of Footnoted.org was recently interviewed by Henry Blodgett and Aaron Task about the huge salaries many top CEOs have continued to receive while the performance of their respective companies have often been mediocre or poor.  Check it out, Michelle’s analysis is often quite sobering.  For the interview click here.

Portfolio manager Grant Jaffarian works for the company Efficient Capital Management. Efficient Capital Management invests in Managed Futures. We talked with Mr. Jaffarian a little bit about this kind of investing, what it means, and why investors should choose it:

Mr. Jaffarian: Managed futures, in general, show no correlation to traditional investments or alternative investments in general. That means managed futures tend to have returns that add diversification, particularly in difficult periods for traditional investments. A good example, of course, would be last year in which it was obviously a difficult environment for traditional investments and many alternative investments as well; however, managed futures as an industry returned well in excess of 20%. That sort of diversification benefit is a real positive for investors. Additionally, returns are extracted in a way that has no reliance whatsoever on underlying beta. It’s entirely actively managed, and it’s entirely alpha in the form of returns. The lack of beta in the return stream explains why managed futures show a lack of correlation with traditional investments. Investors are finding it increasingly difficult to obtain consistent alpha, and we believe non-directional, alpha generating managed futures can be a good source.

For the complete Investing Strategies report, including a full interview with Mr. Jaffarian as well as portfolio managers in a wide variety of styles, click here.

The stimulus seems to be  encouraging the Healthcare IT stocks according to  Richard Close Managing Director, Equity Research of Jefferies & Company, Inc., as part of our Healthcare IT Report, he gave us his view on the industry and which stock are rising ;

“Despite our cautiousness, the stocks have taken a run upward with the overall change in market sentiment, with people going towards higher beta names and, as a result, the healthcare IT stocks have definitely moved to the upside. Although the economy is improving from the near grinding halt earlier this year, I still believe this is a challenging business pur­chasing environment over the next couple of quarters. We’ve been telling investors not to chase these names at this point because some of the stocks have doubled from the lows of the year. We would look at pullbacks to provide entry points to get more aggressive on shares. Despite our short-term cautiousness, an investor can build a favorable longer-term scenario as the stimulus kicks in. Again, in­vestors should be opportunistic in taking positions in these names.”

To see who the top picks in Healthcare IT are check our TWITTER

Portfolio manager Virginia Dawson of Claremont Investment Partners believes:

 ”If you can’t explain in half an hour to an eight year old what your strategy is, and they can’t get the basics of it, it’s probably too complicated.”

That’s why Claremont doesn’t practice any kind of complicated alternative investments, but rather chooses to invest in Industry Leaders. Ms. Dawson took a half an hour recently to talk to one of our editors here at TWST (who’s quite a good deal older than eight) about exactly what Claremont’s investment strategy is:

Ms. Dawson: We don’t invest in stocks, we invest in companies. We look at fundamental factors and run them through a quantitative model, and everything that we look at is pre-market sentiment, that’s pre-stock price. We are not looking at any ratios that would have anything to do with stock price. The major factors that we are looking at are common shareholders’ equity, and we’re looking at credit rating and/or credit risk. If a particular company doesn’t have debt outstanding, we have an internal synthetic debt risk rating for the company. Basically what we are looking for is companies that have a strong balance sheet. Typically the companies that meet our screen have strong management teams, they tend to be global, they are generally large cap, and many pay dividends (although paying a divided is not a screening criteria). They tend to have low debt or a low debt ratio, and they have very strong common shareholders’ equity. It’s a strong balance sheet…We wouldn’t say that we necessarily have a value fund, but obviously it has a value tilt because as a long-only equity fund, one of the ways to pick up alpha is to buy stocks that are undervalued by the market. Basically we just pick strong companies, pre-market pricing sentiments. If you are able to look at the underlying fundamentals of a particular company and pick the right ones, you may be able to pick the stock that is undervalued in the market, and we believe that that’s what our strategy actually does.

For the complete Investing Strategies report, including a full interview with Ms. Dawson as well as portfolio managers in a wide variety of styles, click here. 

Paul Otellini, Intel’s CEO, received high praise for his three year push to make the firm important again.  In a story by Paul Johnson for the Mercury News the reporter wrote,

Since becoming Intel’s CEO four years ago, Paul Otellini has presided over one of the most dreadful periods in the Santa Clara chip maker’s history.

… When he took control of the company, it was staggering from a string of questionable business ventures and product missteps, and its once high-flying stock began to sag. Then its sales practices came under increasing regulatory scrutiny, recently resulting in a $1.45 billion European antitrust fine. As if that weren’t enough, it got body slammed by one of the nastiest recessions ever.

… But all in all, analysts say, Otellini’s record so far has been impressive.

“About three years ago, half the Street was calling for his head” said Hans Mosesmann of Raymond James & Associates. Today, he added, “I’d give him very high grades. B-plus, A-minus. Pretty darn good considering all the stuff he inherited.”

Otellini deserves all the praise he has received and more.  Despite the many difficulties he has faced since taking the reins of the company overall he has managed to perform what many might consider a minor miracle.

As George Bush 41 learned in 1992 it’s the Economy stupid. It was true then and it is true for the gaming industry today. We recently spoke with Grant Coverson of Union Gaming Group who gave us his view of  the gaming industry;

” a lot of people kind of considered gaming to be more or less recession proof. Obviously, that is not the case and, especially with this consumer-led recession, it’s really crushed gaming, especially in Las Vegas. There are a couple different dynamics here: You have Las Vegas, the US outside Vegas and then Asia. Vegas has been hit particularly hard. It’s always been a destination -  you’ve got to get on a plane, you’ve got to get a hotel room, etc., and what’s happened over the past year-plus is that if you happen to live in, say, Chicago, you’re now more likely to go to a riverboat in the suburbs and gamble there rather than jump on to a plane and come to Vegas. It’s a convenience factor. So in other words, the regions or the riverboats have outperformed Las Vegas and continue to do so. “

Is this where we insert some sort of pun about what happens in Vegas stays in Vegas ? Sorry to disappoint but no pun here just the facts. And the facts seem to point to a rough patch for gaming that may take 5 to 10 years for recovery.

Make sure to follow us on TWITTER.

Jalopnik, the car blog, leaked a GM Memo today on more management and strategic changes planned for the struggling car company.  For those interested in the auto industry and particularly in General Motors check out the leaked memo.

Our featured company for this week is BreitBurn Energy Partners LP (BBEP).

BreitBurn Energy Partners L.P. is a California-based independent oil and gas partnership focused on the acquisition, exploitation and development of oil and gas properties in the United States. The copany’s assets consist primarily of producing and non-producing crude oil and natural gas reserves located in the Antrim Shale in Michigan, the Los Angeles Basin in California, the Wind River and Big Horn Basins in central Wyoming, the Sunniland Trend in Florida, and the New Albany Shale in Indiana and Kentucky.

GM’s new chairman, Ed Whitacre the former AT&T chairman and CEO, appears to be taking his news responsibilities seriously.  According to a story by David Welch in BusinessWeek,

General Motors’ recently installed CEO, Frederick A. “Fritz” Henderson, has had just one board meeting with his new slate of directors. And already they are giving him pressure to show better results.

… (Henderson’s) first board meeting shows a stark contrast from GM’s old board. With a few exceptions, the previous directors showed a lot of patience with ousted Chairman and CEO Rick Wagoner. He racked up some $80 billion in losses since 2005 but kept solid backing. The old board also had to focus mostly on costs since the automaker has been in nearly constant restructuring mode for years.

… At the meeting, new Chairman Ed Whitacre, who had previously been chairman and CEO of AT&T (T), and several other directors pressed Henderson on how the company would build revenue, strengthen its brands, and communicate the message that its new products are competitive. “All of their questions were on revenue,” Henderson said, adding that they asked, “What are your metrics? How will you hold yourself accountable?”

While the government has been constantly under criticism for getting involved in the auto industry’s affairs and bailing them out so far, it has demonstrated far more moxy in relation to management than previous shareholders.  Let’s hope the new board can really get some results out of GM’s new CEO, Fritz Henderson and his management team.  Stay tuned.

We recently spoke with Bret Jones Brean Murray, Carret & Co., LLC  as part of our 42 page Healthcare IT Report, reports that the stimulus package that was signed into law early this year established Medicare and Medicaid incentive payments for hospitals and physician practices that have adopted and are meaningful users of a certified electronic health record (EHR). The CBO projects that, basing expenditures on adoption projects, about $36 billion of incentive payments will be made through 2019.

Some comes still remain attractive including Eclipsys;

“Eclipsys is well positioned to capture a disproportionate share of the 200-400 bed hospital segment. We estimate the greenfield market in this segment is over $41 billion. I think when you look at their market opportunity relative to their market cap, there is still room for upside there. Eclipsys, given the greenfield opportunity of the segment they are targeting and the margin expansion opportunity, is a good way for investors to play the stimulus package.”

The most important forward-looking indicator is bookings growth, which is likely to grow as a result of stimulus demand. However, he cautions that when the booking growth trend peaks and begins to level off around 2012, investor sentiment is likely to reverse. He expects that the multiple applied to the shares will start to adjust in 2011.