Pick: ACE Limited (ACE)
Growth at a reasonable price is the goal for Susan Kempler. In addition to earnings, cash flow, and valuation, she zeroes in on whether the management team knows how to maintain and accelerate growth. Since Kempler took over in 2005, TIAA-CREF's $2.7 billion Growth & Income Fund (TIGRX) has produced 5.9% yearly returns (vs. 3.3% for the S&P). She's a believer in insurer ACE Limited, which has used acquisitions to expand in Asia and Europe and create a diverse business that doesn't depend on the U.S. commercial property and casualty market. ACE has a history of commanding high rates, and it has maintained a robust balance sheet. Kempler appreciates that ACE uses less debt than its peers, giving it room to lever up if it needs to spur growth. With a 2.7% dividend yield and steady stock performance, it's been her ACE in the hole -- the kind of stock you buy and don't have to worry about. "Insurance isn't going away," Kempler says. "It won't be intermediated by a business like Amazon, which disrupts retail. And this company is best in class."
--K.B.
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