"We continue to find the shares of NationsBank attractive," (NYSE, NB, $45)," says Katherine Hensel, Shearson Lehman Bros.
"We believe that profitability will improve over the next three years . . . Long-term, the bank is strategically positioned to be a winner. The stock fits our criteria for core holdings -- a premier business franchise, an ability to deliver high-quality service to its customers and a clearly articulated strategy.
"Indeed, we believe NationsBank is the best-positioned bank to benefit from both cyclical improvement and ongoing changes in its industry. . . . We award the stock our top buy rating."
"Sound Advice (OTC, SUND, $6.75) remains one of my favorite stocks," says Gene Aldridge Market Letter, Richardson, Texas.
"This company is an outstanding Florida retailer focusing on upscale stereo and television equipment. . . . Over the past five years, sales have quintupled, while book value has tripled. Nevertheless, the stock price remains below its initial offering price of six years ago. Meanwhile, same-store sales in January, February and early March were up about 20 percent. The recession will hold fiscal 1992 profits to about 50 cents a share. However, 1992 could see earnings jump to $1.20 or more per share. Buy."
The balance sheet of Resorts International (AMEX, RT, $2.25) suggests that a meaningful turnaround has begun, according to The R.H.M. Survey, Glen Cove, N.Y.
"In attempting to find the best leveraged profit opportunities in promising sectors, we are adding Resorts International to our list of best-situated stocks. [It] boasts major casino operations in both Atlantic City and the Bahamas. Its checkered past includes its leveraged buy-out in 1988 by Merv Griffin, a messy bankruptcy . . . and an August 1990 reorganization that restructured debt . . . Massive debt of $19 a share in 1988 . . . was cut to . . . $2 per share last year."
Catalina Lighting (AMEX, LTG, $5.375) "appears well positioned for an impressive turnaround in 1992," says R.J. Falkner & Co., Houston, Texas.
"By taking advantage of lower costs abroad, the company can deliver fashionable lighting fixtures to retailers at wholesale prices well below those available from domestic manufacturers. . . . The onset of recession, however, caused sales to slow to just 4.3 percent in fiscal 1991. . . . While P/E multiples are not appropriate when analyzing the early stages of a turnaround, we note that the stock sells for nine times our estimate of 1992 profits, while the average stock sells for 24 times trailing earnings."