Morningstar Advisor - December 2013/January 2014 - (Page 18)

Investments à la Carte Five Picks for the Present Stock: Exelon EXC Fair Value Estimate $42 Morningstar Rating QQQQQ 2013 Stock Price Compared With Fair Value Estimate Daily Closing Price $60K Fair Value - Daily 50 40 30 11/08/12 02/08/13 05/08/13 08/08/13 Uncertainty Medium Economic Moat Wide Exelon's primary business as the largest U.S. nuclear power plant owner long has been a profit machine and an industry-leading source of shareholder value creation for the company. But power prices have crashed hard since their 2008 highs and appear stuck at current levels for at least the next two or three years. That has resulted in a sharp drop in Exelon's Forward P/E 10.6 Market Cap $24.1 billion returns. But the low operating costs and clean emission profile of its nuclear fleet make Exelon the utilities sector's biggest winner if our outlook for higher power prices and tighter fossil fuel environmental regulations materialize. Exelon's world-class operating efficiency ensures it will be able to capture that upside. Travis Miller Mutual Fund: Dodge & Cox International DODFX 60 Morningstar Category Foreign Large Blend 50 $22K 40 Morningstar Rating QQQQ Daily Closing Price Dodge & Cox International MSCI EAFE GR USD 18 30 14 20 8/12/13 10/10/13 10/11/13 10/14/13 10/15/13 11/12/121/3/132/21/134/16/136/4/137/23/139/13/1311/6/13 11/13/121/4/132/22/134/17/136/10/13 8/1/139/19/13 11/8/12 1/1/132/19/134/12/136/3/137/22/139/12/1311/5/13 11/14/121/10/133/1/134/19/136/12/13 8/2/139/20/13 11/9/12 1/2/132/20/134/15/13 6/5/137/24/139/16/1311/7/13 11/15/121/11/133/4/134/22/136/13/13 8/5/139/23/13 11/16/121/14/133/5/134/23/136/14/13 8/6/139/24/13 11/19/121/15/133/11/13 5/1/136/19/138/12/1310/3/13 11/20/121/16/133/6/134/24/136/17/13 8/7/139/25/13 11/21/121/17/133/12/13 5/2/136/20/138/13/1310/4/13 11/22/121/18/133/13/13 5/3/136/21/138/14/1310/7/13 11/23/121/21/133/14/13 5/6/136/24/138/15/1310/8/13 11/26/121/22/133/15/135/10/137/1/138/19/1310/16/13 11/27/121/23/133/18/135/7/136/25/138/16/1310/9/13 11/28/121/24/133/19/135/13/137/2/138/20/1310/17/13 11/29/121/25/133/20/135/8/136/26/138/21/1310/18/13 11/30/121/28/133/21/135/14/137/3/138/22/1310/21/13 12/3/12 1/29/133/22/135/15/137/4/138/23/1310/22/13 12/4/12 1/30/133/25/135/16/137/10/13 9/2/1310/24/13 12/10/122/1/13 3/26/135/17/137/5/138/26/1310/23/13 12/5/12 1/31/133/27/135/20/137/11/13 9/3/1310/25/13 12/11/122/4/13 3/28/135/21/137/12/13 9/4/1310/28/13 12/6/12 2/5/13 3/29/135/22/137/15/13 9/10/1311/1/13 12/12/122/11/134/1/13 5/23/137/16/13 9/5/1310/29/13 12/7/12 2/6/13 4/2/13 5/24/137/17/139/11/1311/4/13 12/13/122/12/134/3/13 5/27/137/18/139/6/1310/30/13 12/14/122/7/13 4/4/13 5/28/137/19/139/9/1310/31/13 12/17/122/13/134/10/13 6/11/13 8/8/139/26/13 12/18/122/8/13 4/5/13 5/29/13 7/25/139/17/13 12/19/122/14/134/11/13 6/6/137/26/139/18/13 12/20/122/15/134/8/13 5/30/13 7/29/13 9/27/13 12/21/122/18/134/9/13 5/31/13 7/30/13 9/30/13 12/24/12 2/25/134/18/136/7/13 7/31/13 10/1/13 12/25/12 2/26/13 4/25/136/18/13 8/9/13 10/2/13 12/26/12 2/27/13 4/26/13 6/27/13 8/27/13 12/27/12 2/28/13 4/29/13 6/28/13 8/28/13 12/28/12 3/7/13 4/30/13 7/8/13 8/29/13 12/31/12 3/8/13 5/9/13 7/9/13 8/30/13 1/7/13 1/8/13 1/9/13 7/26/13 8/12/13 7/11/13 9/5/13 7/18/13 10 7/11/13 11/08 11/09 11/10 11/11 Nov-08 Morningstar Analyst Rating Fair Value - Daily 11/12 Expenses 0.64% Dodge & Cox is in some ways a stodgy firm. Its long-tenured investment team typically sees little turnover, it goes decades without launching new funds, and its managers buy and sell stocks at a glacial pace. But this fund is no shrinking violet. It will buy beaten-down fare and keep adding to positions on the way down Minimum Investment $2,500 Total Assets $51.5 billion if the team is convinced it's right, and the fund often owns a hefty stake in emerging-markets stocks. (Its weighting was recently triple the foreign-blend category norm.) So, the fund isn't for the faint of heart. But while its returns can be volatile, the fund has generated an excellent long-term record. Greg Carlson Nov-12 Separate Account: Luther King Capital Management Equity Morningstar Category 8 22000Mid-Cap Growth 18000 $24K Investment Style 8 Mid-Cap Growth Luther King Capital Mgmt Equity S&P 500 TR 14000 17 10000 10 6000 Nov-08 Jul-09 Mar-10Nov-10 Jul-11 Mar-12Nov-12 Jul-13 Dec-08Aug-09Apr-10Dec-10 Sep-11 Jun-12Feb-13Oct-13 Jan-09Sep-09 Jun-10Feb-11Oct-11 Jul-12 Mar-13 Feb-09Oct-09 Jul-10 Mar-11Nov-11 Aug-12Apr-13 Mar-09Nov-09 Aug-10Apr-11Dec-11 Sep-12 Jun-13 Apr-09Dec-09 Sep-10 Jun-11Feb-12Oct-12 Aug-13 May-09Jan-10 Oct-10 Aug-11Apr-12Dec-12 Sep-13 Jun-09Feb-10 Jan-11 Jan-12 Jan-13 May-10 May-11 May-12 May-13 Oct-12 Dec-12 Sep-12 Oct-12 Nov-12 Sep-12 11/08 11/09 11/10 11/11Jul-12 11/12 Dec-12 Oct-12 Sep-12 18 Morningstar Advisor December/January 2014 24000 Morningstar Rating QQQ Number of Holdings 38 This strategy's conservative take on largegrowth investing tends to shine in tough times. Lead manager Luther King and the veteran team backing him focus on companies that generate sustainable high returns on invested capital without taking on too much leverage that they can hold for years (annual portfolio averages just over 20%). They also diversify the portfolio broadly, often Annual Turnover 65% Total Strategy Assets $643 million stashing less than 20% of assets in the top 10 holdings and typically avoiding big stakes in a particular sector. The result has been strong risk-adjusted results over the long haul. If the stock market stumbles after its big run since the start of 2012, this strategy should hold up relatively well. Greg Carlson

Table of Contents for the Digital Edition of Morningstar Advisor - December 2013/January 2014

Morningstar Advisor - December 2013/January 2014
Contents
Contributors
Letter From the Editor
What’s Your Purpose?
Working for Gen Y
How to Allocate College Savings
Mobius Looks to a New Frontier
Investments á la Carte
Investment Briefs
How to Manage Bonds for Today and Tomorrow
Cloud Is the New Engine of Growth
Knowing Where to Look
Economic Vulnerability Varies by Country
Factor Investing in Emerging Markets
Following the Rules
Exploring Indexing’s Next Frontiers
Frequent Fliers
Family Blind Spots
Optimal Portfolios for the Long Run
Finding Value in a Pricey Sector
Our Favorite Mutual Funds
50 Most-Popular Equity ETFs
Undervalued Stocks With Wide Moats
The Emerging-Markets Roller Coaster

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