Endeavor Funds' Jerome Dodson Defends 3 Stocks Beaten Down In 2016

Jerome Dodson of Endeavor Funds spoke with Barron's about three stocks that were beaten down in 2016 and if investors should expect a turnaround in 2017.

Gilead

Shares of Gilead Sciences, Inc. GILD have lost nearly 30 percent throughout 2016.

Dodson pointed out that sales of Gilead's Hep. C therapy are declining since it is able to cure patients, and once a patient is cured there is no longer a need for them to take the therapy. However, Dodson said he is optimistic on Gilead's pipeline and ability to come up with new products, including an HIV treatment.

He added that Gilead has a history of making good acquisitions and developing new drugs — either of these two factors could prove to be a catalyst in the coming year.

Whole Foods

Whole Foods Market, Inc. WFM has seen its stock lose around 6 percent throughout 2016. While the decline isn't as severe as Gilead's, the stock has lost more than half of its value since its peak in 2013.

Dodson argued that Whole Foods' customer base is "very dedicated" at a time when the competition is increasing, even from traditional non-organic grocers.

However, Whole Foods' new smaller store concept called 365 will be successful in winning back some of the customer base the chain has lost over the years to its new competitive foes, such as Trader Joe's.

Dodson added that Whole Foods stock is already trading at such a low level that any sort of improvement in its operation will be welcomed by investors.

American Express

Shares of American Express Company AXP are actually higher by more than 7 percent in 2016 but did slump to a multi-year low of $50.27.

Dodson argued that he likes American Express from a marketing standpoint, and it is great at building relationships with its customer base through rewards, especially at the premium end of the market.

Dodson believes the stock is still cheap enough, and "it wouldn't take much" for the stock to continue moving higher.

At Last Check

• American Express shares were up 1.08 percent at $75.09.
• Gilead was down 1.88 percent at $71.41.
• Shares of Whole Foods were up 2.24 percent at $31.73.