Investing

Why Microsoft, Intel and Boeing Are This Fund Manager's Top Picks After Earnings

Boeing shares recently traded at $148.00. The stock has a consensus price target of $162.83 and a 52-week range of $115.14 to $158.83. The dividend yield is 2.5% and the market cap is $99 billion. Forrest said:

Boeing is a large holding that did very well in the quarter. The company delivered more planes than it forecast earlier in the year and so it’s deferred production costs rose, moving the 787 (program) closer to profitability. This quarter’s results show that the company should be more profitable in the coming year, which we cheer as long-time holders of the stock.

Intel’s shares were recently trading at $33.75. It has a consensus price target of $35.01 and a 52-week range of $24.87 to $37.90. The market cap is $160 billion and the dividend yield is2.8%. Forrest’s commentary on Intel said:

Intel is another company that reported results higher than anticipated, especially in light of the continuing lack of demand for new PCs. Like Microsoft, investors have linked the company inexorably to the rise and fall of the PC market. As more consumers use phones and tablets instead of PCs, investors have expected Intel’s decline. However, the company benefitted from continued sales of servers, likely to cloud-oriented companies, and it has shown some gains in selling CPUs in other non-PC markets.

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In a closing remark, with Microsoft being Forrest’s top pick after earnings, she said:

We have long had this opinion about Microsoft and it has been difficult at times explaining why we kept the stock in our portfolios. We always kept watch on areas like server and tools and the Office franchise when the company issued earnings reports, to make sure they were still creating software that businesses want and need. Too often in the past analysts had focused on the very rich margin area of PC operating systems. It was reasonable for the sell-side to dislike Microsoft if you were only looking at PC shipments. This quarter seems to have changed many investors’ minds.

Charts from StockCharts.com for Microsoft, Intel and Boeing have been included below.

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