5 Best Value Stocks To Buy Now According To Howard Marks

1. PG&E Corporation (NYSE: PCG)

Oaktree first initiated a position PG&E Corporation (NYSE: PCG) during the September quarter of 2020 and left its position unchanged in the fourth quarter. The share price of PG&E Corporation rose close to 12% in the last six months. The company generated $18.47 billion in revenues in the latest quarter, up 7.8% from the year-ago period. It expects 2021 earnings per share in the range of $0.52 to $0.38 and non-GAAP EPS around $0.95 to $1.05.

GoodHaven Capital Management, a concentrated portfolio investment management firm, highlighted a few stocks including PG&E Corporation in the fourth quarter investor letter. Here is what GoodHaven Capital Management stated:

“During the period we purchased a new holding – PG&E Corporation – the California based utility (PCG). We expect that contrarian special situations will continue to (opportunistically) be an important part of the portfolio. After all, we bought PCG – which has filed Ch. 11 twice related to prior exposure to wildfire liabilities and staggering mismanagement – right in the middle of California’s recent heavy wildfire season. Our thinking here is that the reorganized utility has new regulatory protections that significantly reduces wildfire liability exposure, an above average rate growth profile and potentially much better management – they were searching for a new CEO when we made our investment. We purchased the stock at a high single digit forward earnings multiple, a discount to its peers that trade in the mid to high teens. Shortly after our purchases PG&E hired the well regarded Patti Poppe as their new CEO – we like this decision.”

You can also take a peek at Ricky Sandler’s Top 10 Stock Picks and David Einhorn’s Top 10 Stock Picks.

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