This week's Alpha Trader podcast features hosts Aaron Task and Stephen Alpher speaking with Eddy Elfenbein, portfolio manager of the AdvisorShares Focused Equity ETF (CWS), and editor of the must-read Crossing Wall Street blog. His Buy List of 25 stocks - it only gets changed once per year on January 1 - has a 14-year compounded gain of 309.6% vs. the S&P 500's 247.1%.
One of the key questions before the court is whether - after all these years of underperformance - value is finally having its day vs. growth. This time is real, argues Elfenbein, noting value has been outperforming since September. The initial boost for value was thanks to market shudders post-Labor Day that drove high-fliers like Tesla (TSLA) sharply lower. More recently, the positive news about vaccines has investors selling work-from-home plays, and buying re-opening/value sectors like financials, travel, energy, and mall REITs.
Turning to stocks he owns, Elfenbein says Disney's (DIS) investment in streaming has paid off. The company surprised all by turning a profit in Q3, with a whopping 73.5M streaming subscribers. Disney, says Elfenbein, is now a streaming service a la Netflix (NLFX), but with amusement park and film production businesses on the side. The stock's been on a big run of late - rising about 20% just this month - but Elfenbein would be a buyer right now all the way up to $150 (shares closed at $144.67 on Monday).
More generally, Elfenbein loves companies with a strong market niche and strong competitive advantage. Other names on the Buy List are Aflac (AFL), which does about 75% of its business in Japan and has lifted its dividend every year for decades. Another stock is Moody's (MCO), with Elfenbein noting the only thing better than a monopoly is a near-monopoly - and Moody's fits that description.
There's plenty more, including Charlie Munger making the bull case for Disney as only Charlie Munger can, why Elfenbein is a big fan of Ross Stores (ROST) despite its lack of online presence, and just a taste of a preview of what changes he might be making to his Buy List in December.
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