Money Life with Chuck Jaffe

Thursday, Sep 20, 2012

Jack Ablin

chief investment officer, Harris Private Bank

Big Interview

Links: www.harrisbank.com

Thursday, Sep 20, 2012

Oliver Pursche

President, Gary Goldberg Financial Services; co-manager GMG Defensive Beta Fund (MPDAX)

MoneyLife Market Call

Links: www.thebetafund.com

Wednesday, Sep 19, 2012

Mike Jolin

co-manager, Heartland International Value Fund (HINVX)

MoneyLife Market Call

Links: www.heartlandinternationalfund.com

ShortHeadline: With investors worried about the international economic landscape, Mike Jolin, co-manager of the Heartland International Value Fund (HINVX), says the place to turn to for bargains is Japan.

DetailInformation: In the MoneyLife Market Call interview,Jolin said that the entire Japanese market is trading below book value. “It is one of the most attractively valued developed markets trading at .9 times book value,” said Jolin,. Who currently has one-third of his portfolio allocated to Japan. “This big, bad bear market in Japan has pummeled stocks down to valuations we just can’t pass up.” Jolin, who noted that he likes to take a contrarian approach, said that the environment in Japan is starting to look more attractive. “The Bank of Japan has been aggressively easing,” Jolin said, “… and they have already set a 1% inflation target, so we are looking at a deflationary picture changing over to inflationary, and we think that has positive implications for the stock market.” One Japanese stock Jolin finds particularly attractive is Medikit (JP: 7749), a medical-device company that historically has grown at double digits, but that currently has a “compelling valuation.” “Medikit is trading at 11.6 times next year’s earnings, with no debt, but it has $262 in cash … so it has almost 80% of its share price in cash,” Jolin said. “If you net out the cash from the share price, you have a stock trading at less than three times estimated earnings and it has been able to grow double-digits. I think that’s incredible.” Jolin noted that his fund has “started to nibble on a few names – high quality businesses with low debt” in Europe, but said “the financial system there still could have some weakness, so companies with high debt that need to roll bank loans could have some trouble, so we definitely are staying away from levered companies in Europe.” One European stock Jolin likes is KUKA AG (DE: KU2), which the fund has done with but which still has room to run. During “Hold It or Fold It,” when guests give their appraisal of stock requests made by the MoneyLife audience, Jolin put sell recommendations on Huaneng Power International Inc.(HNP), Veolia Environment SA (VE) and Portugal Telecom SGPS (PT), and recommended buying Tata Motors (TTM) and Best Buy (BBY). Interestingly, in Monday’s MoneyLife Market Call interview, money manager Tim Holland of TAMRO Capital Partners had suggested selling Best Buy.