2011 Stock Picks: Cambiar Small Cap (CAMSX)
What are our favorite funds for 2011? Among US funds, we particularly like Cambiar Small Cap (CAMSX); the fund combines many characteristics for long-term success with good positioning for the current investment environment.
Cambiar Small Cap is managed by Andy Baumbusch and Jeff Susman. Baumbusch specializes in the analysis of industrial, media and telecommunications stocks. Susman specializes in the consumer-discretionary and technology sectors.
In 2010, their efforts produced a total return of 35.7%, among the top performances of all the funds we track.
Permalink: [632] Top Stocks To Buy - 2011 Stock Picks: Cambiar Small Cap (CAMSX),Novavax (NVAX)
And, they aren’t looking for stocks that are just a little cheap, historically speaking. They search out stocks whose valuations fall in the bottom 25% or so of these historical ranges.
In this way, they hope to increase the odds of picking stocks that gain at least 50% over the next 12 to 24 months, which is their goal for performance.
One key to doing so, they believe, is to find companies that are likely to benefit from near-term catalysts including new products and services, or from restructuring, such as the closing of an unprofitable business unit or product line.
We also like how the fund’s current sector weightings shake out from the managers’bottom-up (i.e., stock by stock) stock picking.
Cambiar Small Cap has especially large allocations to industrials and technology, whichh are among our favorite sectors for equity investment in 2011.
2011 Stock Picks: Novavax (NVAX)
Novavax (NVAX), one of our new buys last year, has basically been flat since our initial recommendation at $2.44.
The stock was recommended because we believe that they are a industry leader in the development, manufacture, and commercialization of innovative vaccines for a variety of viral diseases.
The company is currently testing two vaccines based on its virus-like particle (VLP) technology in late stage trials; vaccines for seasonal and pandemic influenza are in Phase II and the company is preparing for Phase III trials.
We believe that NVAX has substantial potential to develop a vaccine platform based on their VLP technology.
NVAX has differentiated itself from its competitors within the vaccine development space with a proven management team, including CEO Dr. Rahul Singvhi, a recognized vaccine industry leader.
He has worked in vaccines for entire career, including substantial experince at vaccine-giant Merck.
When we recommended NVAX, we said we exepcted the following events to occur for NVAX.
First, we expect the company to receive a government contract in the $100+ million range that will be used to finish developing and bring both their pandemic and seasonal flu vaccines to the market.
Then in the Q1 of 2011 we expect NVAX to start a Phase 1 clinic trial for their respiratory syncytial virus (RSV) vaccine to prevent infection in neonates and the elderly.
We are still waiting for the government contract, which we still exepct at any time. The Phase I RSV trial recently starte.
The trial is a blinded, placebo-controlled, escalating-dose study of healthy adults 18 to 49 years old, a total of 100 subjects will be allocated to four cohorts and randomized to receive vaccine treatment or saline placebo in a 4:1 ratio.
It is expected that interim top-line data from the trial will be available in the third quarter of 2011.
We want to emphasize that this is a substantial market opportunity with very large potential sales around the world.
For example, the passive RSV vaccine Synagis for just infants exceeded $1 billion in sales in 2009.
There are currently no cost-effective measures for protecting elderly people against RSV, so a new solution would significantly enlarge what is already a billion dollar market. NVAX is a buy under $3.
