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By Jason Stipp | 05-28-2009 01:57 PM

Playing the Cards in Financials

Eric Fischman, manager of MFS Growth, thinks card-processors Visa and MasterCard will show above-market earnings growth for the next three to five years.

Jason Stipp: Moving on to individual sectors and areas where you are seeing opportunity, one thing I noted not necessarily uncommon for a growth portfolio to be less weighted in financials, but there are a couple of opportunities you'd seen in financials. What is your take on that sector right now?

Eric Fischman: I think within financials, there is always interesting places to be. So whether or not you are bullish on the credit cycle and where we are in credit, there are other areas within financials that are interesting places to look at where there is secular growth and secular earnings growth and great business models. For instance, in some of the credit card processors, Visa and MasterCard. Those are great business models. They don't take credit risk. They have pricing power and there is strong earnings growth, so people are focused on the consumer spending environment and worry about credit cards and credit losses.

But if you look at Visa and MasterCard for instances, they don't take credit risk. They have pricing power. They have been able to take pricing power throughout this downturn and they are going to be able to show earnings growth, significantly above the market for the next three to five years. And that's really what we look for with ideas. Read Full Transcript

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