Why I Like These Stocks: Market Monitor

The stock market is fairly valued right now, fund manager Charlie Bobrinskoy told “Nightly Business Report.” While he doesn’t see great opportunities or massive risks, he does have several stocks he likes.

Microsoft (MSFT)

People think MSFT is going away, but it’s not, said Bobrinskoy, vice chairman of Ariel Investments and portfolio manager of the Ariel Funds. The company’s cloud business is good, and people everywhere still use its Word program.

“They still have a great business, and they have a ton of cash on the balance sheets—almost $72 billion of cash,” he added.

IBM (IBM)

IBM is on the cutting edge of big data, Bobrinskoy said. Its stock is also trading at about 11-12 times earnings.

“They had one bad quarter, but we think their business is recovering,” he said.

He called IBM and Microsoft “out of favor and very cheap stocks.”

Western Union (WU)

Western Union has the highest margins in the business, Bobrinskoy said.

While some people think technology will leave WU behind, there are strict federal regulations that will limit technology’s reach. For example, he said, transferring money on smartphones requires bank accounts to be in the U.S. People sending money across borders have to contend with strict controls set up by the U.S. government, and WU is “very well set up to handle that.”

“It’s a great company with good growth,” Bobrinskoy said. Western Union is trading at about 11-12 times earnings.

Disclosures: Ariel Investments owns MSFT, IBM, and WU. Charlie Bobrinskoy personally owns MSFT, IBM, and WU.

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