Cisco (CSCO)

(Top Pick May 19/15, Down 1.96%) Old tech. It just needs a catalyst. Lots of value. Maybe a year from now it could be up 50%.

(Market Call Minute.) A good company and have made the transition to the new digital switching era. Not expensive.

Took a pretty good hit at the start of the year, but has recovered almost all of that. Unlike a pure growth stock, this tends to get lumped in with the momentum or growth stocks, but scores better on a valuation basis. Scores in the top 10% for him on valuation. Trading at 7.4X EBITDA and 14X PE. If we are going to get another round of cyclical recovery in the US, as manufacturing picks up again, there will be incremental spends to companies in IT services like this. 3.7% dividend yield. No debt and they have cash in the balance sheet.

With more and more of us doing more with our smart phones, it is important to stay spectrum efficient and CSCO-O benefits from this. They are affectively doing acquisitions. They are buying strategic acquisitions and integrating them. 12 times forward earnings.

It is in the same zone as mature tech companies. It is a more senior business, but is not rewarded the same way as smaller businesses. He believes this business is essential for the backhaul business. They have to be competitive in their pricing so there is going to be margin compression and they will continue to not be able to jack up the dividend aggressively. He would prefer a bank in terms of the dividend.

Had owned this many years ago, but it got overrun in terms of a commoditization play. Obviously routers and switches got a little old. Newer technology took over, so the company has become a very, very slow grower, and hard to get out of its own way.

(Top Pick Feb 27/15, Down 14.65%) You’ve seen a broad sell off in general in the tech sector. It’s up 10% today after reporting earnings. That is in line with why they bought it. Mobile providers are in need of bandwidth. Cyber security is where money is being spent and they have done key acquisitions there. 11 times earrings and they raised their dividend.

Sold his position last year at around $26. Likes the company very much and is a big believer in the evolution and growth in the Internet of things. This company is a central component of that hub. They are dealing with competitive pressures out of China, and a lot of their major customers are building a lot of their own products internally. It was major currency headwinds that caused him to pull Sell. Good strong balance sheet and a good dividend yield. He expects he will own this again in the future, but doesn’t think the stock is going anywhere soon. We are still early in this correction.

(A Top Pick Feb 27/15. Down 18.1%.) The story hasn’t changed. With the increased usage of smart phones, there is a need to stay spectrum efficient. This company is helping the carriers do that with networking solutions. Also, with the Internet of Everything, this company tends to benefit in terms of integration of networks. He is excited about their cyber Security side of things. Pays a great dividend, so you need to be a little more patient with this.

He owned it years ago and did well. A lot of their technologies have become commoditized and the competition has become extreme. The CEO has stepped aside. He may be talking about this one in two or three years. He would want to have more certainty before committing capital to it.

(A Top Pick Oct 9/15. Down .96%.) The last half of the year tends to be dominated by consumer spending, and the 1^st half of the year by industrial production. He wanted to take advantage of the tendency for consumer stocks to run higher to the Christmas season. The average gain between October 3 and December 5 is 10.5%, and it was actually higher over that period by 14.8%.

Thinks the stock is worth $40.95 and is currently trading at $27.17. They got a new CEO a year ago, and maybe it is time for him to put his stamp on the company. He would buy this one.

A great company, a great long term success story. He likes it here. They had FX headwinds and some of the general macro noise about spending being weak has people worried, but he thinks that is already in the stock price and he would buy it here. The free cash flow, dividend increases and the long term free cash flow make it worth more than it trades at.

(A Top Pick Jan 28/14. Up 4.06%.) Struggling big time from currency headwinds. They have a new CEO and a very strong balance sheet with a good track record of increasing its 3% dividend.

Facebook (FB-Q), Google (GOOG-Q) and Apple (AAPL-Q) are the pipeline companies, and this one is the ditch digger that makes all the stuff work behind them. Great dividend yield of 3.08%. A solid operator. They are struggling through foreign currency problems, so it may be a challenging environment. Has some competition from the Chinese, but it is a very innovative company and very strongly ingrained in the infrastructure of the Internet, which we’re going to continue to see grow.