Question: I thought the sky was the limit for my shares of Monster Worldwide Inc., but apparently I was wrong. What are the prospects now?
Answer: Despite robust international growth and the powerful role of the Internet in job placement, the stock of this Internet job-search pioneer is pressured by the uncertain economy.
The strong employment network the company has assembled faces obstacles such as high unemployment and a growing number of online competitors.
Shares of Monster Worldwide are down about 70% from their 52-week high.
The company — which earned $31.8 million in the third quarter, compared with a loss of $5.7 million a year earlier — recently approved a plan to buy up to $250 million of its stock. It also expressed caution about near-term economic uncertainty.
Consensus analyst opinion on shares of Monster Worldwide is "buy," according to Thomson Reuters, consisting of four "strong buys," four "buys," six "holds" and one "underperform."
Monster Worldwide began as a conventional publishing house but transformed itself into an Internet job operator with major operations in the U.S., Europe, Asia and Latin America. The Monster Employment Index, a monthly hiring barometer for several regions, presents forecast data culled from a wide range of career websites and online job listings.
The company is in excellent financial health, with little debt and a reputation for operating efficiency, though it heavily depends on classified advertisements. Besides its ability to target audience sectors, it provides personalized career advice. It has used the rough economy as an opportunity to aggressively expand its market share.
Monster Worldwide bought HotJobs from Yahoo Inc. last year. It has introduced the cloud-based SeeMore search platform, the BeKnown professional networking application on Facebook and the Veterans Talent Index to help connect military veterans with prospective employers.
Royce Special Equity Investment fund often thrives in downturns
Question: What is your opinion of the Royce Special Equity Investment fund?
Answer: The holdings that it hasn't included in its portfolio have been the biggest boon to its performance over the last year.
The fund doesn't invest in the small banks that have been under considerable economic and governmental pressure. It generally does well in economic downturns because it sticks with financially strong small companies with plenty of cash and the ability to pay dividends.
The Royce Special Equity Investment fund was up 0.1% over a recent 12-month period to rank in the top eighth of the small growth-and-value category. Its three-year annualized return of 16% put it in the bottom half of its peers.
Portfolio manager Charlie Dreifus has been with the fund since its 1998 inception, said Karin Anderson, a mutual fund analyst with Morningstar Inc.
Rather than focus on sectors, Dreifus looks for what he considers to be a steeply discounted price regardless of what the company does. Clear financial reporting, high returns on invested capital and ample available cash are primary traits of the stocks he buys and holds. He has more than $1 million of his personal money invested in the fund.
Top holdings recently included Bio-Rad Labs Inc., Bed Bath & Beyond Inc., Lancaster Colony Corp. and American Eagle Outfitters. This "no-load" (no sales charge) fund requires a $2,000 minimum initial investment and has an annual expense ratio of 1.16%.
Starting in January, Andrew Leckey will no longer write his investing column for Tribune Media Services, which has carried it for more than 26 years, so that he can focus on his efforts as president of the Donald W. Reynolds National Center for Business Journalism at Arizona State University.