Apple (AAPL), Abbott Labs (ABT), Berkshire Hathaway (BRK-A), And Disney (DIS) Recommended As Value Oriented Investing Targets By Portfolio Manager Ryan M. Sailer Of Union Investment Management Group In This Exclusive Interview With The Wall Street Transcript
November 8, 2011 - The Wall Street Transcript has just published Value Investing & Investing Strategies Report offering a timely review of the Asset Management sector. This Special Report contains expert industry commentary through in-depth interviews with public company CEOs, Equity Analysts and Money Managers. Please find an excerpt below.
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Ryan M. Sailer, CFA, is Vice President and Portfolio Manager of Union Investment Management Group, a division of Union Bank & Trust Company. He has 13 years of investment experience. Prior to joining Union Bank, he managed the research function for a regional investment firm. Mr. Sailer is a graduate of Creighton University, where he earned a BSBA degree with a major in accounting. He manages a combination of institutional and private accounts.
TWST: What's your overall outlook and advice for investors for the next 12 months?
Mr. Sailer: For the short to intermediate term, that it's going to be a volatile next six to 12 months would probably be the one certainty I would predict. But if you do truly have a longer-term time frame, you're looking at fixed income markets, which are very unattractive on a yield basis - ranging from a few basis points three to six months out to going out five years to earn 1% on a Treasury bond - so investors seem to be willing to take almost no return just for taking risk off the table. But on the other hand, you have several high-quality stocks that pay dividend yields well above Treasury bond rates, and those stocks are also trading at inexpensive valuations, and in many cases, pricing in little to no growth.
The upshot is that if we do get any sort of rebound in the economy, there's significant upside as well as a nice dividend yield while you wait in high-quality stocks. For income investors, traditionally you had to look to the bond market. I am suggesting that income opportunities are also present in the stock market versus the bond market.
TWST: In any particular areas?
Mr. Sailer: If you look at consumer staples, stocks like Pepsi (PEP) yield well over 3%. A lot of the health care stocks, including Abbott Labs (ABT), which I mentioned earlier, and Johnson & Johnson (JNJ), yield over 3%. Surprisingly, certain technology stocks pay nice dividend streams as well. A stock like Microsoft (MSFT) has a higher dividend yield than their longer-term bonds pay in interest. In fact, I see an abundance of blue-chip stocks that pay dividend yields higher than the 10-year Treasury currently yields.
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