Companies are putting their ample cash reserves to work, which may help the bull market to keep advancing
BERWYN, Pa.–(BUSINESS WIRE)–In the latest Quarterly Perspectives With Bob Turner video, the chairman and chief investment officer of Turner Investments notes that companies are using the ample cash reserves in their balance sheets to repurchase their shares, initiate or raise dividends, and make acquisitions. That may help stocks to keep rising, he believes.
\Many companies, he estimates, have “anywhere between 15 to 20% of their balance sheets in cash.” He thinks that cash hoard and the continuing but slowing growth in corporate profits may help the bull market that began in March 2009 to advance further.
In this video, he offers his views on these topics as well:
- Despite slowing earnings growth, a significant number of companies are still generating above-average growth. He notes that some of the holdings in Turner Investments’ growth-stock portfolios, for instance, have earnings-growth rates of 15-20% – three times the average rate.
- In a period of sluggish economic growth, investors tend to gravitate to growth companies that can sustain superior profitability. That tendency of investors may help growth stocks to continue to “outperform over the next several quarters,” he says.
- The housing market, after a number of false starts, seems to be recovering, which should benefit companies like Lennar, Toll Brothers, PulteGroup, The Home Depot, and Lowe’s Companies.
- Manufacturing in the U.S. appears to be making a comeback, and companies like Caterpillar, Cummins, Ametek, and Stratasys can capitalize on that comeback.
You can view the video, here.
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The views, opinions, and content presented are for informational purposes only. They are not intended to reflect a current or past recommendation, investment, legal, tax, or accounting advice of any kind, or a solicitation of an offer to buy or sell any securities or investment services. Except as otherwise specified, any companies, sectors, securities, and/or markets discussed are solely for illustrative purposes regarding economic trends and conditions or investment process and may or may not be held by Turner, the Turner Funds, or other investment vehicles or accounts managed by Turner or its affiliates. Past performance is no guarantee of future results.
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Turner Investments, founded in 1990 and based in Berwyn, Pennsylvania, is an investment firm with more than $11 billion in assets under management in stocks, as of September 30, 2012. Turner manages growth, global/international, and long/short separately managed accounts and mutual funds for institutions and individuals.
As of September 30, 2012 Turner held in client accounts 543,915 shares of Apple, 135,958 shares of Google, 830,785 shares of Caterpillar, 391,130 shares of Cummins, 1.8 million shares of Ametek, 625,020 shares of Stratasys, 1.7 million shares of Lennar, 802,090 shares of Toll Brothers, 322,220 shares of PulteGroup, 1.3 million shares of The Home Depot, and -367,100 shares of Lowe’s Companies.