Bill Gross: Barron’s 2011 Roundtable Picks for Investors

Barron’s collected the opinions of ten market observers this weekend.  Following is a summary of one of these investors’ calls on the market.  What do you think of their selections?  Be sure to stay tuned for an analysis of the other nine pundits’ calls.

Bill Gross:  Bill Gross is the co-founder of Pacific Investment Management (PIMCO) and he runs PIMCO’s $252 billion Total Return Fund.  PIMCO is a wholly owned subsidiary of the German bank Allianz SE (NYSE:AZ).  Readers should make note of the fact that Gross’ recommendations include two funds that his company manages.

  • Annaly Capital Management (NYSE:NLY): The shares have traded in a 52-week range of $16.73 to $18.54 and most recently traded at $18.22.  Its market capitalization is $14.82 billion, its P/E ratio is 7.28, it earned $2.50 per share last year, and it pays a dividend of $2.48 per share.  About the company:  Annaly Capital Management Inc. is a real estate investment trust which owns and manages assets and funds on behalf of institutional and individual investors worldwide. The Company manages a portfolio of mortgage backed securities, including mortgage pass through certificates, collaterized mortgage obligations, and other securities.  Competitors include: Chumera Investment Corp. (NYSE:CIM), Hatteras Financial Corp. (NYSE:HTS), Capstead Mortgage Corp. (NYSE:CMO), Crexus Investment Corp. (NYSE:CXS), American Capital Agency (NASDAQ:AGNC), Anworth Mortgage Asset Management (NYSE:ANH), Invesco Mortgage Capital (NYSE:IVR), Cypress Sharpridge Investments (NYSE:CYS), Two Harbors Investment (AMEX:TWO), and Eastern Light Capital (AMEX:ELC).
  • Pimco Corporate Opportunity Fund (NYSE:PTY): The shares have traded in a 52-week range of $15.55 to $21.49 and most recently traded at $19.73.  Its market capitalization is $1.33 billion, its P/E ratio is 4.28, it earned $4.61 per share last year, and it pays a dividend of $1.38 per share.  About the company:  PIMCO Corporate Opportunity Fund is a diversified, closed-end management investment company incorporated in the USA. The Fund’s objective is maximum total return through a combination of current income and capital appreciation.
  • Pimco Income Strategy Fund (NYSE:PFL): The shares have traded in a 52-week range of $10.60 to $12.93 and most recently traded at $12.55,  Its market capitalization is $310.93 million, its P/E ratio is 5.41, it earned $2.32 per share last year, and it pays a dividend of $0.90 per share.  About the company:  Pimco Income Strategy Fund is a diversified, closed-end management investment company incorporated in the USA. The Fund’s investment objective seeks high current income, consistent with the preservation of capital. The Fund invests at least 80% of its assets in a diversified portfolio of floating rate debt instruments.
  • Procter & Gamble (NYSE:PG):  The shares have traded in a 52-week range of $58.92 to %67.72 and most recently traded at $64.60 per share.  Its market capitalization is $180 billion, its P/E ratio is 17.02, it earned $3.80 per share last year, and it pays a dividend of $2.10 per share.  About the company:  The Procter & Gamble Company manufactures and markets consumer products in countries throughout the world. The Company provides products in the laundry and cleaning, paper, beauty care, food and beverage, and health care segments. Proctor & Gamble’s products are sold primarily through mass merchandisers, grocery stores, membership club stores, drug stores, and neighborhood stores. Competitors to Watch: Church & Dwight Co., Inc. (NYSE:CHD), Colgate-Palmolive Company (NYSE:CL), The Clorox Company (NYSE:CLX), Henkel AG & Co. (HEN3), Kimberly-Clark Corporation (NYSE:KMB), Johnson & Johnson (NYSE:JNJ), Teva Pharmaceutical Industries Ltd (NASDAQ:TEVA), The Stephan Co. (SPCO), CCA Industries, Inc. (AMEX:CAW), and Zep, Inc. (NYSE:ZEP).
  • Coca-Cola (NYSE:KO):  The shares have traded in a 52-week range of $49.47 to $68.77 and most recently traded at $64.89.  Its market capitalization is $148.48 billion, its P/E ratio is 12.51, it earned $5.19 per share last year, and it pays a dividend of $1.88 per share. About the company:   The Coca-Cola Company manufactures, markets, and distributes soft drink concentrates and syrups. The Company also distributes and markets juice and juice-drink products. Coca-Cola distributes its products to retailers and wholesalers in the United States and internationally. Competitors to Watch: PepsiCo, Inc. (NYSE:PEP), Dr Pepper Snapple Group Inc. (NYSE:DPS), Hansen Natural Corporation (NASDAQ:HANS), Coca-Cola Enterprises Inc. (NYSE:CCE), Heckmann Corporation (NYSE:HEK), National Beverage Corp. (NASDAQ:FIZZ), Jones Soda Co. (NASDAQ:JSDA), Celsius Holdings, Inc. (NASDAQ:CELH), and Cott Corporation (NYSE:COT).
  • Merck (NYSE:MRK): About the company:   Merck & Co., Inc. is a global pharmaceutical company that discovers, develops, manufactures, and markets a broad range of human and animal health products. Merck’s products include a treatment for elevated cholesterol, a treatment for male pattern hair loss, a preventive treatment for osteoporosis, a treatment for hypertension, and a treatment for allergic rhinitis. Competitors to Watch: Johnson & Johnson (NYSE:JNJ), Pfizer Inc. (NYSE:PFE), Bristol Myers Squibb Co. (NYSE:BMY), GlaxoSmithKline plc (NYSE:GSK), Sanofi-Aventis SA (NYSE:SNY), Insmed (NASDAQ:INSM), Eli Lilly & Co. (NYSE:LLY), Abbott Laboratories (NYSE:ABT), Johnson & Johnson (NYSE:JNJ), Forest Labs (NYSE:FRX), Teva Pharmaceutical Industries Ltd (NASDAQ:TEVA), and Novartis AG (NYSE:NVS).

(Note: All the original Barron’s article can be seen here.  Selected financial data is taken from Yahoo! Finance.  All data are assumed to be accurate.)

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