Janus

Looking through the 3D glasses of the style box, you think it would be easy categorize a fund like Janus Mid Cap Value. It must be a fund that buys the stocks of midsize companies that its managers deem to be undervalued. While most of its portfolio does hew to this predetermined approach, the description does not reflect exactly what stocks managers Tom Perkins and Jeff Kautz prefer at the moment. "I don’t like being put in a box too much," says Perkins, who has managed the fund since its 1998 start. "I try to run the fund as flexible as possible with in the limits of the prospectus." The prospectus requires that 80% of the stocks they buy carry market capitalizations of between $700 million to $17 billion.

But recently, the duo have found that the preponderance of bargains are among stocks of large companies. Because small caps and mid caps have beaten large-capitalization stocks for seven straight years, it is more difficult for Perkins and Kautz to find bargains in their usual stomping grounds. Last year, for example, they invested in Coca-Cola (symbol KO), hardly a stock you’d expect to find in a mid-cap fund. A review of the fund’s 2006 performance finds stocks of large companies contributed mightily. Among big large-company gainers last year were AllianceBernstein (AB), Berkshire Hathaway (BRK), Marathon Oil (MRO), Norfolk Southern (NSC), Waste Management (WMI), Deere (DE) and CVS (CVS).