Good Things In Large Packages

Eddie Brown's Equity Fund looks to cap risk by sticking with brand names

more, the company has a way to go before even beginning to saturate its retail market. He thinks the company will grow earnings at a 25% rate over the next five years, while selling at 30 times estimated 1998 earnings.

Another holding is Cardinal Health (NYSE: CAH), a drug distribution company with a projected 23% earnings growth rate. “It has been a major factor in industry-wide consolidation, and by picking up critical mass, they’ve lowered costs.”

Sterling Commerce (NYSE: SE),
meanwhile, is a major player in EDI–or electronic data interchange. In layman’s terms, the company handles electronic transactions between big corporations. Brown likes the fact that the industry is growing. And, he says, Sterling should boost earnings 30% a year, even though the stock, at a price-to-earnings multiple of 27, is still relatively cheap.

Brown Capital Management Equity Fund
800-809-3863
Manager: Team managed
Sales charge: None
Minimum initial investment: $10, 000 ($2,000 for IRA)

TOP FIVE HOLDINGS

Company (Exchange: Symbol)

Type of Business

Price*

Cardinal Health (NYSE: CAH) Drug distribution $81.38
Home Depot (NYSE: HD) Home improvement retailer 66.56
T. Rowe & Associates (Nasdaq: TROW) Investment firm 66.50
Chase Manhattan Bank (NYSE: CMB) Money center bank 122.38
MCN Energy Group (NYSE: MCN) Natural gas distribution/exploration 37.13
* As of 2/25/98
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