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Commentary

Research Highlights: Updated Picks and More

Here's some of the best research we published this past week.

Here's a guide to the top stocks and funds we published new research on this week. 

Key Stock Reports This Week
Among the Analyst Reports we published this week were two stocks--Sun Microsystems (SUNW) and Microsoft (MSFT)--that have been regulars in Morningstar StockInvestor's Hare Portfolio. As we detailed in the January issue, Sun is still a bargain, with an estimated fair value well above its current beaten-up stock price. Microsoft, on the other hand, had risen more than 30% since we added the stock to the portfolio and had dropped to 2 stars. As a result, we recently sold Microsoft from the Hare Portfolio.

 Amazon (AMZN), by David Kathman
"Amazon's fourth-quarter results were impressive by just about any standard."

 American Home Products (AHP), by Todd Lebor
"With average revenue growth of 8% over the next five years and very tiny improvements in operating margins, AHP is a cash cow."

 Cisco Systems (CSCO), by Jay Ritter
"The January 21 issue of BusinessWeek revisits the controversy surrounding Cisco's accounting methods."

 Harley-Davidson (HDI), by T.K. MacKay
"The market has priced in a lot of enthusiasm for the company's continued success, however, and values the shares about 25% above where we think they should be."

 Microsoft (MSFT), by Joseph Beaulieu
"The stock's decline after the company reported December-quarter results was more likely due to management's lowering of estimates for the rest of the fiscal year (ending June) than any real disappointment with quarterly results."

 Motorola (MOT), by Todd Bernier
"Net debt (total debt less cash and short-term investments) has fallen by $3.9 billion over the past year as a result of better working-capital management, asset sales, and lower capital spending."

 Sun Microsystems (SUNW), by Joseph Beaulieu
"While we are encouraged by the December quarter, we still see Sun as a high-risk, high-reward bet."

Key Fund Reports This Week
Among the Fund Analyst Reports we published this week were several Fund Analyst Picks. (These are the funds we consider to be the best in their categories.) Vanguard Growth & Income (VQNPX) is one of five  large-value Analyst Picks. Vanguard Growth Index (VIGRX)is one of our five  large-growth Analyst Picks. And Security Capital U.S. Real Estate (SUSIX) is one of three  real-estate Analyst Picks.

 Bear Stearns S&P Stars (BSPAX), by Heather Haynos
"It held up particularly well in 2000 and 2001, when most large-cap growth stocks hit the skids."

 Janus Venture (JAVTX), by Catherine Hickey
"The good news for shareholders is that, even with its still-aggressive profile, the fund is performing just fine."

 Mutual Discovery Z (MDISX), by William Samuel Rocco
"Winters hasn't made too many other purchases lately, though, because he generally thinks valuations are too high."

 Security Capital U.S. Real Estate (SUSIX), by Alan Papier
"In light of this fund's exceptional record, it would be easy for detractors to deride its 2001 performance."

 Vanguard Extended Market Index (VEXMX), by Scott Cooley
"Net redemptions in 2001 have allowed Sauter to sell off some high-cost shares and book tax-loss carryforwards."

 Vanguard Growth & Income (VQNPX), by Scott Cooley
"Manager John Cone and former skipper John Nagorniak have built quantitative models that are supposed to beat the index without taking on significant sector and industry risk."

 Vanguard Growth Index (VIGRX), by Scott Cooley
"The fund's cost advantage accounts for about 40% of its three-percentage-point edge over its average rival during the past five years."