"I'm tremendously encouraged by the fact that the majority of my fellow investment newsletter writers are bearish to an extreme level only seen three to four times a decade," says Bill Staton's Money Advisory (2113 E. Fifth St., Charlotte, NC 28204), in making an interesting contrarian case for stocks. "This group is virtually always wrong at major turning points. They were wrong after the crash of 1987. They were wrong again in fall 1990. Unless history is writing a new chapter, they'll be wrong this time, too."
- After posting 17.6 percent average annual returns during his nine years at Selected American Shares, Donald Yacktman struck out on his own with the Yacktman Fund. His type of stock - large companies with high growth rates and returns on assets, and low P/E ratios and capital requirements - had a rough 1993, dropping 6.6 percent. But it got back on track last year, rising 8.4 percent. Recent favorite stocks: Philip Morris, Bristol-Myers Squibb, Merck, Pfizer, Fruit of the Loom, Johnson & Johnson, RJR Nabisco.- The big communications stocks have been quiet lately. But Michael Gianturco of Princeton Portfolios newsletter (301 N. Harrison, Princeton, NJ 08540) thinks he's found an interesting way to play the sector through a quartet of tiny companies that make the big telephone companies work better. "They're positively booming," he says, "because of their stakes in the new communications technology. And they're not weighed down by balance sheets full of plant and equipment costs." The four: Applied Innovation, Apertus Technologies, Three-Five Systems, Level One Communications.
- Despite the market's recent rise, many promising and well-known growth stocks still trade well below their previous highs. And many have dividend reinvestment plans (DRIPs), which allow shareholders to accumulate additional shares without paying brokerage costs. DRIP Investor news-letter (7412 Calumet Ave., Hammond, IN 46324), which specializes in such stocks, has seven favorites: Bausch & Lomb, H&R Block, Gannett, McDonald's, Merck, PepsiCo, Walgreen.
- You have to pay taxes on zero-coupon bond interest every year, even though you don't receive it until the bonds mature. "However," notes Standard & Poor's Outlook (25 Broadway, New York, NY 10004), "a few outstanding corporate zeros were grand-fathered when the rules changed, so they necessitate no tax payments before maturity. Two GMAC issues and one Exxon/
Seariver Maritime issue currently lock you into 8 percent to 8.5 percent, tax-deferred, with high-quality paper."
- Everybody's bullish on the Pacific Rim. But as the recent Mexican experience shows, it can be risky investing in emerging markets. According to Personal Finance newsletter (1101 King St., Suite 400, Alexandria, VA 22314), "the companies most likely to benefit from the emerging Far East boom are those already entrenched in economies like Hong Kong, Korea and Malaysia. There are two no-load funds that provide excellent gateways into such markets: T. Rowe Price New Asia and Fidelity Pacific Basin. Both have solid portfolios, reasonable fees and exemplary performance records."
Investor's Notebook is a digest of investment opinion from the world's leading financial advisers. It does not recommend any specific investments, and no endorsement is implied or should be inferred. For more information, contact the individual firms cited.