David Baskin Precision Castparts Corp. PCP-N TOP PICK May 12, 2015

This company makes all the nuts and bolts and complex metal parts that go into aerospace engines and airplanes. They sell to Boeing, Airbus, Rolls-Royce and GE. Backlog is massive. Like a lot of companies, this has some exposure to oil/gas, which hurt their earnings a little bit and the stock has fallen about 30%. He sees, over the next 10-15 years, aircraft demand doubling, mainly due to Asian aircraft travel including cargo and business travel. Great free cash flow. Dividend yield of 0.06% and it is growing.

They have warned twice this year. The problem is that they have some exposure to oil and gas. No one is ordering drill parts. There is big exposure to airplanes including demand from China for bigger models. Gushing free cash flow and it is a good time to buy this stock. He is looking out 3-5 years.

They make primarily parts for airplanes. Boeing recently ran down their inventory. The stock is down 16% year to date. 16 times earnings. This is a real premier industrial company and is a bargain. Low yield, but he thinks there is potential for an increase as well as stock buy backs. Sees it in the $250 range when oil recovers.

Makes parts for the aerospace industry. Aerospace has been going through a replacement cycle of new plane upgrades, so companies like Boeing (BA-N) have had a pretty good go over the last number of years. This company had very, very strong growth because their content per plane was going up. They have seen a deceleration over the last few quarters, so the stock is down over the last year. If you need to own something in the space, you could look at Boeing, which has consolidated over the last 4 months.

Still bullish on this stock. It has had some ups and downs since recommending. It had some bad news from Boeing. But it should be just a temporary thing. Facing some headwind with the energy industry, not selling heavy casting in the energy industry. Tremendous manufacturing business in the US. Quite happy with it and should see it go north of $200. Good value at this price.

This is about to be acquired by Berkshire Hathaway. They offered $235 a share and he sold his holdings. If you own, tender or sell the stock and look to buy something else.

(A Top Pick Feb 20/15. Up 9.21%.) Acquired by Berkshire Hathaway.

(A Top Pick May 12/15. Up 10.35%.) Taken over by Berkshire Hathaway.

(A Top Pick July 2/15. Up 18.04%.) This was acquired in January.