EDDIE C. BROWN
Chief investment officer
Assets under management: $5 billion
GDP: 1% to 1.5%
CPI: 2% to 2.5%
Hot stocks: Amdocs, Applied Materials, Harley-Davidson, Home Depot, Kohl's, Nokia
Eddie Brown describes himself as "cautiously optimistic" about prospects for the economy and the stock market in 2002, but doesn't expect corporate profits and the economy to begin to rebound until the second half of the year.
Mr. Brown bases his opinion on the sharp cuts in inventories and costs by corporations in 2001 that should begin resulting in higher revenues and profits after the middle of the year.
He believes the stock market already has begun anticipating an economic recovery in the second half of 2002, but doesn't expect spectacular performance.
Assuming there are no further terrorist attacks, Mr. Brown believes the overall market could return 8% to 10%, with nimble, smaller companies on the Nasdaq returning 12%. In 2001, the stock market danced to a "one step forward and three steps backward" routine, he said. In 2002, Mr. Brown expects the market will dance to a "three steps forward, but one step back" tune. His firm invests in growth stocks that are reasonably priced, and he anticipates plenty of opportunities to buy shares in companies growing at a rate faster than the market, but priced at a reasonable multiple relative to the broad market.