In a discussion with Fox Business News anchors David Asman and Liz Claman from the show ‘After the bell,’ Hank Smith, who is the CIO of Haverford, speaks on his stock picks which include International Business Machines Corp. (NYSE:IBM) while Dan Haugh, who is the President of PTISecurities.com discusses Google Inc (NASDAQ:GOOGL).
“Well, first of all it is cheap. It’s not just attractively priced; it is cheap. So, if you are looking for something with a below market PE, IBM has that.” said Smith, on his stock pick of International Business Machines Corp. (NYSE:IBM), that has been showing a stagnation in revenues over the past several quarters.
According to Smith, if the upcoming results are able to beat consensus then the stock can be seen breaking the $200 mark. He added that International Business Machines Corp. (NYSE:IBM) has been an aggressive buyer of its own stock and that the recent deal with Apple Inc. (NASDAQ:AAPL), to develop applications catering to big enterprises, can turn on to be a positive for the stock.
The deal will help both the companies in capturing the growing technological needs of corporate who are slowly, but steadily evolving from using PC’s to more mobile devices like smart phones and tablets.
Meanwhile, speaking on Google Inc (NASDAQ:GOOGL), Haugh said “I think it (recent investments in R&D paying-off) will, but I don’t know about the payoff quite yet. What they are acquiring are future business lines, which won’t help them right now, but, on the other hand, their main business is generating just tonnes of cash, so this, like International Business Machines Corp. (NYSE:IBM), they both are revenue stories.”
Haugh was referring to the various acquisitions and R&D investments made by Google Inc (NASDAQ:GOOGL), which were to the tune of billions of dollars. Google has been using its mighty cash pile for diversification into different industries by acquisition of various companies.
In a similar instance, Google Inc (NASDAQ:GOOGL) has joined hands last week with Novartis AG (ADR) (NYSE:NVS) to come together in the further development of smart contact lens.