This week, portfolio manager Alejandro Paschalides bought shares of Diamond Offshore Drilling Inc (NYSE:DO). Paschalides has a portfolio that focuses on the energy sector and he evaluates positions using a top-down approach—which means he considers the overall activity within the market and sector before examining the individual characteristics of one company. This process helps him narrow down his choices. Since many oil and petroleum stocks are suffering from the impact of the Gulf oil spill, some investors think that it makes them a great buying opportunity. DO is currently trading at a low it hasn’t seen in over a year and has a relatively steady stockholder equity. Because he mixes long and short strategies, it is difficult to know whether Paschalides plans to buy and hold DO or try to sell the next time the price fluctuates and he can profit.
Portfolio manager Ryan Lee bought shares of McCormick & Co Inc (NYSE:MKC) the specialty food and spice manufacturer this week. Lee’s portfolio is conservative buy and hold. He looks for companies with a history of growth and successful methods in gaining a return on their invested capital. While the company’s cash flow statement does not show positive cash flows from investing activities in 2007, 2008 or 2009 it does show reductions in the amount lost through these activities and, in 2009, a positive change in the overall cash and cash equivalents held by the company. In addition, the stock has been rising steadily since 2009—not a surprise since spices can become popular during times of economic decline when people are eating out less and buying less expensive food items.
