The way Americans live now has a major impact on the stocks MTB Investment Advisors selects for its equity portfolios, said William F. Dwyer, president and chief investment officer of the Baltimore-based asset management firm.
"We identify themes we believe have potential for growth, and then have our analysts follow up and search within those themes for companies with attractive valuations," Mr. Dwyer said.
"Beyond demographics" is one current theme at MTB. "We're getting older every day and that won't change, however the economy behaves," Mr. Dwyer pointed out. "We look at the effect of consumption patterns on an aging population: what are the medical needs going to be, with upcoming changes in Medicare benefits, a longer life cycle and cultural diversity in the U.S. We then look at companies that could benefit from these changes." Those include some restaurant companies, as people eat out more, and health-care companies. In these categories, he likes Ruby Tuesday Inc., a restaurant chain whose menus are purposely not spicy in order to appeal to an older clientele. In health care, he likes Express Scripts Inc., a mail-order pharmacy, and United Surgical Partners International Inc., which operates short-stay surgery facilities.
Another major theme for MTB stocks is "information management."
"Instead of the paperless office that technology had promised, there is more paper coming through than ever, and we need to find ways to manage it," Mr. Dwyer noted. "We're interested in companies that have processes to help us do that," he said. One company he likes is Symbol Technologies Inc., which makes bar codes that help companies manage their inventories. Another is Accenture Ltd., which provides management and technology consulting services.
