Would it make sense to shift money into small caps now? If so, which stocks should investors consider?
It does make sense to move money into small-cap stocks as part of a diversified investment strategy. We have a list of nearly 50 names, but I’ll talk about some of my favorites. Cambridge Technology Partners provides management consulting and systems integration services to businesses. We think the company’s earnings will grow at a 30% rate for the next few years, but the stock trades at a multiple of 1999 earnings estimate that is in the low 20s. So, this is an example of buying growth at the right price in our opinion. We also like General Nutrition, which is the vitamin and nutritional supplement retailer with over 3,000 stores across the U.S. General Nutrition recently agreed to provide the nutritional supplement to all the Rite Aid drug stores. This will allow the company to enter a new distribution channel. The shares are trading at about 13 times our earnings estimate of $1.60 per share over the next 12 months. We expect it will be able to grow earnings at a rate of 15% or highe
