In This Corner

As the volatile stock market climbs to new highs, investors continue to fight for the best returns. Our investment roundtable tries to pick the winners as the battle between growth and value rages.

it does an outstanding job acquiring companies and cutting costs after these acquisitions. He says Tyco has an outstanding management team and should have positive earnings surprises.

International Business Machines Corp.: One of the bluest of the blue chips, the hardware and software maker continues to surge. Pearson says that earnings are accelerating because of the company’s focus on sales, service, soft ware and e-business and less on mainframe, reducing cyclicity.

Cisco Systems Inc.: Pearson chose this stock because of the company’s accelerating top and bottom lines. Growth and earnings numbers are going up, and its router product is the back
bone of the Internet. He says Cisco has one the of the best management teams in technology.
Source: Bloomberg; blackenterprise.com

Simmon’s Equity and Fixed-Income Picks

Company/Ticker

52 Week
High/Low

One-Year P/E

Return

FDX Corp.
(NYSE: FDX)

61.87/21.81

20.10

52.48

Sylvan Learning Systems Inc.
(Nasdaq: SLVN)

34.62/17.12

24.55

-17.17

Venator Group Inc.
(NYSE: Z)

14.06/3.18

-70.83

-35.55

FDX Corp.: Best known for its flagship subsidiary, Federal Express, the express shipping and trucking company, Simmons says the company represents a backdoor play on the Internet because good distribution is an important part of the Internet and Fed Ex has that capacity.
Sylvan Learning Systems Inc.: Simmons views education as a growth market and Sylvan as being firmly positioned to grow exponentially over the next decade. It represents the money manager’s ultimate value play.

Venator Corp.: After selling the old Woolworth Department Stores, the company has focused on such key franchises as Foot Locker and Champs Sports outlets. After taking a severe beating in the market over the past year, the stock is extremely cheap and, according to Simmons, poised to rise.

On the fixed-income side, Simmons tells investors to put their dollars in short-term bonds because of the jittery market. He favors two-year U.S. Treasury notes (for notes due June 2001, the coupon is 5.75%) and municipals bonds with maturities of no longer than five years.
Source: Bloomberg; blackenterprise.com

Thomason’s 1999 Value Stock Picks

Company/Ticker

52 Week
High/Low

One-Year P/E

Return

PeopleSoft Inc.
(Nasdaq: PSFT)

39.87/11.50

36.49

-64.59

Borders Group Inc.
(NYSE: BGP)

31.37/11.75

11.68

-58.33

Mattel Inc. (NYSE:
MAT)

40.75/21.25

20.60

-44.32

PeopleSoft Inc.: The company designs, develops and markets client/server application software products. Although the stock’s total return has been lackluster, Thomason believes that the company’s solid management team and corporate strategy make it an undervalued gem. Because of Y2K issues, look for the turnaround to occur in the first quarter of 2000.

Borders Group Inc.: The concern operates book superstores throughout the nation under the Borders and Waldenbooks monikers. Thomason believes that the company can prove to be a strong online competitor to Amazon.com, which currently

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