Name your favorite high quality value companies!
I would like a debate about high quality companies, that are offered at a reasonable price. Preferably non cyclical companies.
I would say Nestlè fits this description. They have proven long-term growth above average, sells products world wide, a strong brand name and somewhat controls their own destiny.
What are your favorites?
Not sure about reasonably priced -- planning to look into it soon, but I think Chipotle (CMG) is a HUGE value play right now.
Not sure if the price is reasonable, but it's a huge value? Oh boy.
Sure, it's an oxymoron. What I meant was that because it is probably very overvalued relative to peers the stock could underperform vastly if investors become bearish on fast-casual dining in general. With a longer time horizon, I think there is a huge upside because the brand itself had a ton of room to run.
Gazprom
Invacare (IVC). Check em out.
I had lunch with Malachi Mixon, the CEO, a few years back and he is a total boss. Favorite line from him, "Sure, owning a company is fullfilling and all that, but the best part about it is being able to tell people 'to get the f*** out of my office', and they have to do it. No one can tell me what to do."
Hahaha what a badass. I wish I had known that before I wrote my stock pitch on IVC, that could've been my opening sentence.
Hahaha what a badass. I wish I had known that before I wrote my stock pitch on IVC, that could've been my opening sentence.
Thanks for the comments. But would be more interesting if people could add a few points on why they like the company as well.
Are people actually posting companies they genuinely believe are quality companies, or just value bets? I would not agree Gazprom is a high quality company, now it is just a bet on the oil price and the russian risk premium.
I would prefer people posting their favorite companies, regardless of price. If it is stable and high quality it can still be good value and high multiples.
You do realize the PE on it to s insane and it gets paid in dollars and that PE is after the Russian gov steals from the coffee
Any investment is a bet .. You're betting everyone else in the market is wrong in the pricing and you're right
PE has been insane on it for 7 years, doesn't make it right. Spend in RUB, earn in USD - you are right. However, doesn't make that turd ok. If you want to play a Russia + oil rebound you stay away from Gazprom, plenty of other stocks in that market that are worth a look at. Gazprom is the play for the lazy investor who isn't doing his homework. You are better of buying the RSX if you haven't done your homework on Russia.
Hopefully if you're buying nestle its not in their debt
May or may not fit your criteria but allow me to present:
Cameron International (CAM)
A world-class provider of flow control solutions to the, but not limited to Oil & Gas companies. Range of products covers all facets of the upstream, midstream, and downstream elements of the O&G industry as well as applications for nuclear industry and just about any company that needs to flow liquids or gas from Point A to Point B.
JANA Partners applied significant pressure on CAM to buyback stock (something this company had not done before) and as a result CAM repurchased shares to the tune of $780,000,000 for fiscal year 2014. Despite the downturn in the economy and low O&G prices CAM has reiterated its commitment to increasing shareholder value and continuing the trend of purchasing more shares for 2015.
What I like about CAM is its position in the marketplace and strong operational/supply chain networks. I don't foresee O&G prices staying this low for long. When drilling activities rebound and rig counts increase CAM will be the go-to source for equipment needs and will easily be able to meet the onslaught of the demand.
CAM also has a services portion of their business which involves performing installation and repairs on equipment out in the field. I suspect E&P companies will due whatever they can to extend the life of their equipment rather than purchase new. To do so they will need to have services, testing, and maintenance performed to extend the life of the equipment.
I would agree with the Cameron recommendation as well as most of the O&G service companies. It is hard to tell if their margins will not be pressured in the long term, but one of their main advantages is that they can charge premiums for the equipment they build because of their necessity to the producers as well as environmental requirements. They have strong brands and depending on the division are a small expense to a producer. They have been hit pretty hard with the sell-off and it is foolish to not want to look in an area that is depressed. Oil will be around for a very long time and deepsea seems to be the future, as long as Cameron doesn't sell off their JV portion I think that that could be a very smart long term play.
As a disclaimer I have Cameron in my portfolio
Any companies that kind of have their faith in their own hands? Also preferably companies not exposed to oil and gas.
Visa has done so well in my portfolio. I highly recommend it.
Standby
CVS Health
Honeywell
Bronte Capital just put up a very compelling post on Rolls Royce. I haven't done any primary research yet but will definitely be looking into it.
http://brontecapital.blogspot.com/2015/03/rolls-royce-and-sequoia-lette…
All the other divisions besides civil aerospace are horrible though (subscale and capital intensive). RR is also not quite as cheap as it looks on face value because of capitalised R&D (which they have to do under IFRS). R&D is high at the moment because they are at the start of a new engine replacement cycle, but the two issues are (1) will R&D really drop off that much in the near future; and (2) future earnings will be dragged by amortisation of the R&D (yes, it's non-cash but you can't always rely on public markets to fully credit that back).
Side note: haven't done a lot of work yet, but I think United Technologies could be a good way to play the airliner engine cycle. They are only exposed to narrow-body aircraft, which have higher utilisation since they are easier to fill, which leads to more wear and tear, and hence aftermarket revenues.
Chevron
Service Corp - Monopoly in funeral services, buying back stock, generates a ton of FCF, slow LBO.
Service Corp - Monopoly in funeral services, buying back stock, generates a ton of FCF, slow LBO.
Service Corp - Monopoly in funeral services, buying back stock, generates a ton of FCF, slow LBO.
PFE. Cash to spend, FCF machine, big Pharma literally cannot lose, only relatively so and in the short term.
Honeywell
Most undervalued stock ever (Originally Posted: 04/16/2013)
CF Industries (CF)
Go.
How do ya figure
I'm no er analyst by any stretch of the imagination, and I was looking to get someone else's take on it.
Why, in your opinion?
Catalyst? Too beaten up?
I dunno man, havent seen every stock ever at every value. Id guess that this isn't the most undervalued stock EVER though.
I hope you aren't registered.
So a potential 25% upside is the new most undervalued stock ever.
I'm with duff on this one. Does it sound good? Sure. The title of your post was a little wishful though.
Check out the potential upside of CHTP on Bloomberg... Now we're talkin' undervalued
Lightweights. Check out orig for a truly undervalued company w/ huge, assured earnings growth in the near term.
Cheap stock, but it looks like Dryships owns the majority (57%) of it and this is holding ORIG back because the CEO is awful. Seems like their backlog and impressive revenue isn't really trickling down to shareholders. I'd put this one on the backburner and just watch it for now until they get new management.
What a shitty thread.
If there arent clear catalysts its probably a value trap.
Rising natural gas prices, N fertilizer costs getting driven down
Market believes earnings have peaked
I do own CF though and would consider buying more
What are the catalysts for a near term pop to the 52 week high? referring to CF. Cursory glance, higher price/rev than group, lower P/CF, higher P/E, stronger current ratio, fucking 24% better margins than group. Good growth. Interesting.
Look in the financial sector for deep value. There are a ton of companies still haven't recovered post crisis. Love COF as a long term holding. AFL too.
Hard to lose long term on large cap banks even after the run-up. C and BAC are stupidly cheap for what they are (the dominant banks in the world's largest economy with international growth). AIG may have gotten a bit ahead of itself, but you can buy it and feel good about your purchase.
If you are willing to take a bit more risk, SAN is just fantastic. Minimal sovereign risk in Spain, strong capital ratios, EM growth.
C/BAC pair FTW
Dahlman Rose downgraded them from "buy" to "sell" back in February with a price target of $170. So, I guess if you respect their opinion, then it's overvalued. That being said, it looks like they're the lowest of the bunch, with the highest being $300 (according to Yahoo Finance).
Well, ya, but does anyone take er firms seriously?
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