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10 growth picks by the best
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June 30, 2000: 8:27 a.m. ET
Top fund managers offer some favorite stocks for a growth portfolio
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CHICAGO (CNNfn) - If you are a growth investor, a few wireless bets might give your portfolio a lift. So will steady players such as Pfizer, especially if the economy slows and the market starts to favor less-risky companies.
Those were just a couple of the recommendations made at the Morningstar Investment Conference by some of the best growth fund managers working today.
When it comes to wireless plays, small-cap manager Jim Callinan of RS Emerging Growth likes two stocks in particular: paging networks MetroCall (MCLL: Research, Estimates) and WebLink Wireless (WLNK: Research, Estimates).
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Relatively low stock prices and flexibility are two of their most appealing traits. "These two companies are ... repurposing themselves to be able to handle alpha-numeric (data) and maybe even Internet and Web browsing traffic over their existing paging networks," said Callinan, who was named domestic equity growth manager of the year by Morningstar in 1999.
Among his non-technology picks, Callinan is high on Four Seasons Hotels (FS: Research, Estimates), which he has owned since it went public a few years ago. Shares have nearly tripled since he bought it, and the number of hotels is growing at 15 percent a year, he said. When he first bought it, the company had only about 35 hotels worldwide. Today there are 50. "I'm going to own this thing till they have 150 to 200 (hotels in) major cities in the world," he said. "It'll be a triple or quadruple in the next five to seven years. That certainly beats T-bills."
 Another emerging growth manager, Garrett Van Wagoner, whose flagship Van Wagoner Emerging Growth fund soared nearly 300 percent in 1999, sees Web content management software as a promising area. In that area, he is a fan of Interwoven (IWOV: Research, Estimates), noting that the company "is clearly a leader in the dynamic content management side of things. It's one of our largest holdings. Its business is superb and we're very much positively disposed toward the stock for the rest of the year."
For large-cap manager Howard Ward's money, if you could own only one stock for the next 10 years, let it be Intel (INTC: Research, Estimates), the biggest holding in his fund, Gabelli Growth, which has risen 38 percent on an annualized basis over the past three years. "I have so much confidence in the management team, the financial resources and the technical expertise that I think that's a stock that should be in every portfolio."
Beyond that, he favors telecom carriers, which he said are getting higher valuations due to accelerated growth rates. Among his picks, Sprint (FON: Research, Estimates), Bell Atlantic (BEL: Research, Estimates) and Bell South (BLS: Research, Estimates).
"I think all of these companies, because of the greater number of services -- whether it's Internet delivery or wireless or data networking -- they're getting into a lot higher growth areas and you're going to get p/e (price-to-earnings) expansion as well as good growth," he said.
Arden Armstrong of MAS Funds is adding to her position in hospital stock Health Management Associates (HMA: Research, Estimates) and is a big fan of Pfizer (PFE: Research, Estimates), a stock she said "we've owned everyday of the last 10 years." And that's saying something, considering there is a nearly 200 percent turnover rate in her Mid-Cap Growth Fund, which has delivered an annualized return of 51.57 percent over the past three years.
With Pfizer, she said, you get stable 20 percent growth. And stability is something she wants to balance out her aggressive bets, which make up more than half of her portfolio. That's because she now anticipates the economy will slow at some point, and when it does, she said, the more tried-and-true growth plays will be more in favor. 
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