UPDATE: Proof that you can outperform with the -2-
After Steve Job died [in October 2011], we told clients that we would have to monitor the company very carefully because it was possible they would not innovate as well as they did in the past, particularly in the area of smartphones with big screens. Apple fell behind in innovation. That was when we sold a lot of our stock. We later became aware the smartphone market was maturing, especially in China, where it become clear consumers wouldn't be wanting to pay $800 to $1,000 for a new smartphone. Competitors were providing good phones for $400 to $500.
MarketWatch: Are there any opportunities you believe the market is overlooking?
Puglia: We think people are still not paying enough attention to some of the durable growers. Growth has outperformed value, so there is a real tendency to think there has to be a reversion. There could be, but there are stocks that aren't necessarily growth stocks -- UnitedHealth and Microsoft or Honeywell (HON) or Dollar General (DG) or Boeing.
It can be the type of market where it is not a rising tide lifting all boats. Companies that are growing nicely can continue to perform reasonably well.
When we look at where there are really cheap stocks -- energy is an area where we are tempted but we do not make a big commitment to energy.
MarketWatch: Any parting thoughts?
Puglia: People question active management, but so far it has worked out well for us.
Here are the 10 largest holdings of the T. Rowe Price Blue Chip Growth Fund as of Dec. 31:
Company Ticker Share of portfolio Amazon.com Inc. US:AMZN 10.0% Alphabet Inc. Class C US:GOOG 6.1% Microsoft Corp. US:MSFT 5.8% Boeing Company US:BA 3.9% Facebook Inc. Class A US:FB 3.8% Visa Inc. Class A US:V 3.5% UnitedHealth Group Inc. US:UNH 3.2% Booking Holdings Inc. US:BKNG 3.0% Alibaba Group Holding Ltd. ADR US:BABA 2.9% Mastercard Inc. Class A US:MA 2.9% Source: T. Rowe Price
Don't miss: BB&T-SunTrust merger signals more bank deals are coming (http://www.marketwatch.com/story/bbtsuntrust-merger-signals-more-bank-deals-are-coming-2019-02-07)
Barron's:These are the 100 most sustainable publicly traded companies (https://www.barrons.com/articles/these-stocks-are-winning-as-ceos-push-for-a-sustainable-future-51549657527?mod=mktw)
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-Philip van Doorn; 415-439-6400; AskNewswires@dowjones.com
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02-12-19 1104ETCopyright (c) 2019 Dow Jones & Company, Inc.