Friday, October 11, 2013

Top 10 Undervalued Stocks To Buy Right Now

Whitney Tilson recently released his second quarter portfolio for his fund T2 Partners Management. The guru bought 19 new stocks over the duration of the second quarter, bringing his total number of stocks to 56, valued at $112 million.


The following five companies represent Tilson�� top five holdings.

American International Group (AIG)

Tilson�� largest holding is in American International Group where he holds 9% of his total portfolio. The guru owns 227,684 shares of the insurance company, representing a small 0.02% of the company�� shares outstanding.

Over the duration of the second quarter, Tilson reduced his position -24.97% by selling 75,760 shares. He sold these shares at an average price of $42.90. Since he sold these shares, the price per share has increased approximately 12.4%.

Tilson has held a position in AIG since first quarter 2012 and since then has seen gains of up to 77.9%.

Tilson�� holding history of AIG as of the second quarter:

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AIG is a holding company which, through its subsidiaries, is engaged in a range of insurance and insurance-related activities in the U.S. and abroad. The company's four reportable segments are as follows: General Insurance, Domestic Life Insurance & Retirement Services, Foreign Life Insurance & Retirement Services and Financial Services.

AIG�� historical revenue and net income:

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The Peter Lynch Chart shows that AIG currently appears to be overvalued:

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American International Group has a market cap of $71.29 billion. Its shares are currently trading at around $48.29 with a P/E ratio of 10.40, a P/S ratio of 1.10 and a P/B ratio of 0.70.

Howard Hughes Corp (HHC)

Tilson�� second largest holding is in Howard Hughes. The guru currently holds 71,564 shares of HHC, representing 7.1% of his total portfolio and 0.18% of the company�� shares outstanding.

During the second quarter, Tilson red! uced his position in Howard Hughes by -8.81%. The guru sold a total of 6,915 shares at an average price of $98.66 per share. Since his sell, the price per share has increased approximately 8.8%.

Tilson has held a position in HHC since fourth quarter 2010 and has seen gains of up to 138.2% since then. Tilson�� holding history as of the second quarter:

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Howard Hughes is engaged in the development of master planned communities and other strategic real estate development opportunities across the U.S. The company operates its business in two lines of business: Master Planned Communities and Strategic Development.

Howard Hughes��historical revenue and net income:

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Howard Hughes has a market cap of $4.23 billion. Its shares are currently trading at around $106.83 with a P/E ratio 68.60, a P/S ratio of 9.50 and a P/B ratio of 2.10.

Berkshire Hathaway (BRK.B)

Whitney�� third largest position is in Warren Buffett�� Berkshire Hathaway. The guru holds on to 68,007 shares which make up 6.8% of his total portfolio.

During the second quarter, Tilson made a minor reduction of his holdings in the company. The guru reduced his position -4.47% by selling 3,179 shares at an average price of $110.02. Since this sell, the price per share has increased approximately 6.5%.

Whitney Tilson has held his position in BRK.B since fourth quarter 2008. Tilson�� holding history of Berkshire Hathaway as of the second quarter:

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Berkshire Hathaway and its subsidiaries engage in diverse business activities including property and casualty insurance and reinsurance, utilities and energy, freight rail transportation, finance, manufacturing, retailing and services.

Berkshire Hathaway�� historical revenue and net income:

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Berkshire Hathaway has a market cap of $273.82 billion. Its shares are currently trading at around $117.16 with a P/E ratio of 15.40, a P/S ! ratio of ! 1.60 and a P/B ratio of 1.40. The company had an annual average earnings growth of 7.8% over the past ten years.

GuruFocus rated Berkshire Hathaway the business predictability rank of 3-star.

Apple (AAPL)

Tilson currently holds 15,200 shares of Apple, making it his fourth largest holding. This holding makes up 5.4% of Tilson�� total portfolio.

Tilson made a notable increase in his position in Apple during the second quarter. The guru upped his stake 87.17% by purchasing 7,079 shares of Apple. Tilson purchased these shares at $430.74 per share, and since his buy the price per share has increased approximately 12.5%.

Tilson has held a position in Apple since third quarter 2011. Tilson�� holding history as of the second quarter:

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The company designs, manufactures, and markets personal computers, mobile communication devices, and portable digital music and video players and sell a variety of related software, services, peripherals and networking solutions.

Apple�� historical revenue and net income:

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This morning Guru Carl Icahn disclosed a large position in Apple, pushing the company for share buybacks.

According to the Peter Lynch Chart Apple currently appears to be undervalued:

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Apple has a market cap of $444.9 billion. Its shares are currently trading at around $489.71 with a P/E ratio of 12.10, a P/S ratio of 2.70 and a P/B ratio of 3.20. The company had an annual average earnings growth of 82.7% over the past 10 years.

GuruFocus rated Apple the business predictability rank of 4.5-star.

J.C. Penney Co. (JCP)

Finally, Tilson�� fifth largest position is in the struggling J.C. Penney. Tilson currently holds 290,000 shares of J.C. Penney, representing 0.13% of the company�� shares outstanding and 4.4% of his total portfolio.

During the second quarter Tilson upped his position in J.C. Penney significantly. The guru increased his! holdings! 2296.69% by adding an additional 277,900 shares to his stake. He purchased these shares at an average price of $16.83 per share and since then the price per share has dropped an additional -24.3%.

Tilson�� holding history as of June 30:

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J.C. Penney sells family apparel and footwear, accessories, fine and fashion jewelry, beauty products through Sephora inside J.C. Penney and home furnishings. Its department stores also provide certain services such as a hair salon, optical, portrait photography and custom decorating.

J.C. Penney�� historical revenue and net income:

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J.C. Penney has a market cap of $2.79 billion. Its shares were traded at around $12.68 with a P/S ratio of 0.20 and a P/B ratio of 1.10.

You can check out Whitney Tilson�� second quarter portfolio here.

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Top 10 Undervalued Stocks To Buy Right Now: Schlumberger N.V.(SLB)

Schlumberger Limited, together with its subsidiaries, supplies technology, integrated project management, and information solutions to the oil and gas exploration and production industries worldwide. The company?s Oilfield Services segment provides exploration and production services; wireline technology that offers open-hole and cased-hole services; supplies engineering support, directional-drilling, measurement-while-drilling, and logging-while-drilling services; and testing services. This segment also offers well services; supplies well completion services and equipment; artificial lift; data and consulting services; geo services; and information solutions, such as consulting, software, information management system, and IT infrastructure services that support oil and gas industry. Its WesternGeco segment provides reservoir imaging, monitoring, and development services; and operates data processing centers and multiclient seismic library. This segment also offers variou s services include 3D and time-lapse (4D) seismic surveys to multi-component surveys for delineating prospects and reservoir management. The company?s M-I SWACO segment supplies drilling fluid systems to improve drilling performance; fluid systems and specialty tools to optimize wellbore productivity; production technology solutions to maximize production rates; and environmental solutions that manages waste volumes generated in drilling and production operations. Its Smith Oilfield segment designs, manufactures, and markets drill bits and borehole enlargement tools; and supplies drilling tools and services, tubular, completion services, and other related downhole solutions. The company?s Distribution segment markets pipes, valves, and fittings, as well as mill, safety, and other maintenance products. This segment also provides warehouse management, vendor integration, and inventory management services. Schlumberger Limited was founded in 1927 and is based in Houston, Texas.

Advisors' Opinion:
  • [By Lee Jackson]

    Schlumberger Ltd. (NYSE: SLB) revenue grew 8% year-over-year to $11.18 billion in the second quarter of 2013, fueled by high growth in its international segment. While the company does generate 11% of revenue in the Middle East and Asia, only a prolonged Syrian conflict is expected to dent their strong results. UBS has a $98 price target and the consensus figure is at $96. Stockholders are paid a 1.5% dividend.

  • [By Tony Daltorio]

    The biggest oilfield service companies should get a big lift from the boom, Moors said. That includes Schlumberger Ltd. (NYSE: SLB), Halliburton Co. (NYSE: HAL), Weatherford International Ltd. (NYSE: WFT), and Baker Hughes Inc. (NYSE: BHI).

Top 10 Undervalued Stocks To Buy Right Now: Tupperware Corporation(TUP)

Tupperware Brands Corporation operates as a direct seller of various products across a range of brands and categories through an independent sales force. The company engages in the manufacture and sale of kitchen and home products, and beauty and personal care products. It offers preparation, storage, and serving solutions for the kitchen and home, as well as kitchen cookware and tools, children?s educational toys, microwave products, and gifts under the Tupperware brand name primarily in Europe, Africa, the Middle East, the Asia Pacific, and North America. The company provides beauty and personal care products, which include skin care products, cosmetics, bath and body care, toiletries, fragrances, nutritional products, apparel, and related products principally in Mexico, South Africa, the Philippines, Australia, and Uruguay. It offers beauty and personal care products under the Armand Dupree, Avroy Shlain, BeautiControl, Fuller, NaturCare, Nutrimetics, Nuvo, and Swissgar de brand names. The company sells its Tupperware products directly to distributors, directors, managers, and dealers; and beauty products primarily through consultants and directors. As of December 26, 2009, the Tupperware distribution system had approximately 1,800 distributors, 61,300 managers, and 1.3 million dealers; and the sales force representing the Beauty businesses approximately 1.1 million. The company was formerly known as Tupperware Corporation and changed its name to Tupperware Brands Corporation in December 2005. The company was founded in 1996 and is headquartered in Orlando, Florida.

Advisors' Opinion:
  • [By Eric Volkman]

    Tupperware Brands (NYSE: TUP  ) is reaching into its corporate bowl for a fresh payout to shareholders. The company has declared a quarterly dividend of $0.62 per share. This will be paid on July 8 to stockholders of record as of June 19. That amount matches the firm's previous distribution, which was paid in early April. Prior to that, Tupperware Brands was rather less generous, handing out $0.36 per share.

  • [By Oliver Pursche]

    European large-cap pharmaceuticals like Novartis (NVS) �and Bristol Meyers Squibb (BMY) �count amongst some of our favorite stocks right now, as do U.S. multinationals that are growing revenue and margins in Asia ��Tupperware (TUP) �is a shining example. Stay away from utilities and energy stocks, as they are likely to be the laggards over the next year.

Hot Energy Companies To Buy Right Now: Dollar Tree Inc.(DLTR)

Dollar Tree, Inc. operates discount variety stores in the United States and Canada. Its stores offer merchandise primarily at the fixed price of $1.00. The company operates its stores under the names of Dollar Tree, Deal$, Dollar Tree Deal$, Dollar Giant, and Dollar Bills. Its stores offer consumable merchandise, including candy and food, and health and beauty care, as well as household consumables, such as paper, plastics, household chemicals, in select stores, and frozen and refrigerated food; variety merchandise, which includes toys, durable housewares, gifts, party goods, greeting cards, softlines, and other items; and seasonal goods, such as Easter, Halloween, and Christmas merchandise. As of April 30, 2011, it operated 4,089 stores in 48 states and the District of Columbia, as well as 88 stores in Canada. The company was founded in 1986 and is based in Chesapeake, Virginia.

Advisors' Opinion:
  • [By Mani]

    Dollar Tree, Inc. (NASDAQ:DLTR) is one of the companies that are set to exploit the ongoing trend of consumers' increasing focus on value with significant opportunity to grow its store base, and expand margins.

  • [By John Maxfield]

    If you're anything like me, two things went through your head when you saw this. First, you regret that you missed out on the investment opportunity. Since the end of 2009, shares in all three of these companies, led by Dollar Tree (NASDAQ: DLTR  ) , have simply trounced the broader market. Even the worst performer of the bunch, Family Dollar (NYSE: FDO  ) , beat it by nearly a factor of two.

  • [By Rising Dividend Investing]

    Falling Stock Correlation: What It Says About Consumer Spending

    As we mentioned in the Take Aways from the August 26th Investment Policy Committee meeting, the correlation index has been steadily declining. In 2008-09, macroeconomic events drove nearly every stock downwards. Specific sectors and stocks moved in tandem with one another. Today, stocks and sub-industries within each sector are performing very differently – which indicates a return to a more normal stock market environment.
    The Consumer Discretionary (also known as Consumer Cyclicals) sector is an example of an industry that has been rewarded for its fundamental success over the past 12 months. As a whole, the sector grew sales 6.1% and earnings 9.2% in the second quarter - much better than the 1.4% sales and 3.3% earnings growth of the S&P 500. While the overall sector did well in the second quarter, the table below shows how differently the 5 sub-categories of Consumer Discretionary performed:

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    As we drill down even further, sub-categories of sub-sectors differ even more dramatically. Below is a snapshot of the Retailing sub-sector and its notable components:

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    Specific stocks within each sub-category are varying in performance as well. General Merchandise retailers were significantly differentiated in the second quarter. Target’s (TGT) adjusted EPS were up 6.1% from 2012, while Dollar General (DG) and Dollar Tree’s (DLTR) earnings were up nearly 12% and 9%, respectively.
    The differences in sales and earnings growth amongst these different industries tell a story. The economy is not improving enough that people feel like they can let go and spend money on pure pleasures, but it is improving enough that they can afford to replace their cars and fix the doors on their houses. As these items wear out and need to be replaced, we expect the pent up demand will drive increased economic activity from cons

Top 10 Undervalued Stocks To Buy Right Now: Caterpillar Inc.(CAT)

Caterpillar Inc. manufactures and sells construction and mining equipment, diesel and natural gas engines, industrial gas turbines, and diesel-electric locomotives worldwide. It operates through three lines of businesses: Machinery, Engines, and Financial Products. The Machinery business offers construction, mining, and forestry machinery, including track and wheel tractors, track and wheel loaders, pipelayers, motor graders, wheel tractor-scrapers, track and wheel excavators, backhoe loaders, log skidders, log loaders, off-highway trucks, articulated trucks, paving products, skid steer loaders, underground mining equipment, tunnel boring equipment, and related parts. It also manufactures diesel-electric locomotives; and manufactures and services rail-related products and logistics services for other companies. The Engines business provides diesel, heavy fuel, and natural gas reciprocating engines for Caterpillar machinery, electric power generation systems, marine, petrol eum, construction, industrial, agricultural, and other applications. It offers industrial turbines and turbine-related services for oil and gas, and power generation applications. This business also remanufactures Caterpillar engines, machines, and engine components; and offers remanufacturing services for other companies. The Financial Products business provides retail and wholesale financing alternatives for Caterpillar machinery and engines, solar gas turbines, and other equipment and marine vessels, as well as offers loans and various forms of insurance to customers and dealers. It also offers financing for vehicles, power generation facilities, and marine vessels. The company markets its products directly, as well as through its distribution centers, dealers, and distributors. It was formerly known as Caterpillar Tractor Co. and changed its name to Caterpillar Inc. in 1986. Caterpillar Inc. was founded in 1925 and is headquartered in Peoria, Illinois.

Advisors' Opinion:
  • [By Matt Thalman]

    Lastly, Caterpillar (NYSE: CAT  ) is down 1% today after industrial-production growth in China missed economists' expectations yesterday. Although April's production grew to 9.3% from 8.9% in March, it was still below the 9.5% which many had estimated. This report is just another indication that major economies around the world that have been going strong over the past few years are now slowing down. And with Europe struggling to get moving, the U.S. only slowly coming back, and developing countries weakening, Caterpillar will feel some pressure in the form of low or even negative sales growth.

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