trading at 12.9 times its fiscal 1997 earnings. U.S. Filter, a water filtration company, is one of the top 10 holdings in the Vista Fund. Water ranks among the most critical resources. U.S. Filter is the No. 1 manufacturer of water treatment systems. U.S. Filter is $35.75 [and] had a great last quarter earnings surprise. It was 11% ahead of expectations. Even though it looks like it’s growing at 22%, with a P/E of 27 times earnings, I really think that this one is going to continue to surprise on the upside. Estee Lauder is a leader in cosmetics with brands like Estee Lauder itself, Clinique, Origins and Aramis. They have very strong brand loyalty and are increasing global penetration. Currently the stock is at $48.38. It should grow earnings at 18%.
FRAZIER: I’d recommend the Merrill Lynch Growth Fund and the Merrill Lynch Global Allocation Fund. The Global Allocation Fund has returned 10%-15% on average. The John Hancock Small Caps Fund is an aggressive growth fund I like. They’re averaging 10%-15%. We think small caps, along with internationals, will resume their pickup later in the year. Another fund I like is the Aim Constellation Fund. They’re averaging 15o,/o -20% as a rate of return. At Putnam, besides your Vista Fund, Kim, we like Voyager and the New Opportunities Fund, which has posted returns in the 16%-20% range.
Three of those stocks I would recommend are: Intel, Oracle and Chase Manhattan. Chase has a P/E of 12.4%. It’s up to about $91.75 a share right now and we feel that it still has another 40% to go. So, we have a 12-18-month price target of $ 125. The second one is Oracle, which is a leading database management system. Right now it’s at $41.25. We have a 12-month target of $65 a share. Lastly, Intel–which our technology analyst said he’d never seen–has a P/E of 15 times earnings. Our 12-18-month price target is $200 a share. Right now, it’s at $140-$145.
JACKSON: First we like Citicorp. The stock is cheap and the bank has reinstated its dividend. They’re great at building a global consumer franchise. Yes, I’m worried about the credit card business, but I think consumers aren’t as strapped as some numbers might reflect. I think Citicorp can earn $8.80 a share in ’97, and is selling at about 12 times that figure. I think the long-term growth rate is 14%.
Dover Corp. has got some very, very diverse businesses. The ones folks know most are probably the Dover Elevator Business and some other capital goods areas that have a small technology component. I expect them to earn $3 in ’96 and about $3.20 next year, but the stock has traded about 15 times now and I think the longer-term growth rate is a conservative 12%.
WILLIAMS: We like HFS; Management seems to be astute enough to pick companies that truly do add value to the bottom line quickly. They are at about $66.75 right now. We would see the stock rising to the