Markets

Our Team Gains 29%

The scorecard on last year's stock picks.

From Kiplinger's Personal Finance magazine, July 2007

Last year we asked seven portfolio managers for their best ideas, and the 22 stocks they offered made up quite a portfolio (see Hot Hands, Hot Picks). Seventeen of them posted double-digit gains, and all but three were in the black for the year. Overall, the picks returned 29% to May 14, including dividends, easily beating the 18% total return of Standard & Poor's 500-stock index.

The top-performing stock was Chaparral Steel (CHAP), picked by Don and Craig Hodges, of the Hodges fund. It soared 129%. The Hodgeses' picks, including Texas Industries (TXI), which spun off Chaparral in 2005, gained an average of 47%.

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Rudolph-Riad Younes, manager of Julius Baer International and Julius Baer International II (see The 25 Best Mutual Funds), contributed three big gainers: Mexican homebuilder Homex Development (HXM), up 71%; French cement maker Lafarge (LR), up 38%; and London-based distiller Diageo (DEO), up 28%. Overall, his picks returned 38%.

Hedge-fund manager Joel Greenblatt, of Gotham Capital, gave us two winning ideas: AutoZone (AZO), up 48%, and American Express (AXP), up 20%. Bruce Berkowitz, manager of the Fairholme fund, gave us three picks that produced an average return of 31%. Satellite-TV provider EchoStar Communications (DISH), which vaulted 59%, led the pack.

The picks of Al Frank fund's John Buckingham and CGM Focus's Ken Heebner returned 24% and 16%. One disastrous choice, clothier Christopher & Banks (CBK; down 34%), hurt Nancy Prial, of AMG Essex Small/Micro Cap Growth. Her picks gained just 3%, on average.

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