Below is the list of 5 best value stocks to buy now according to Howard Marks. For a comprehensive list and investment strategy of Marks please see 10 Best Value Stocks To Buy Now According To Howard Marks.
5. Banco Bradesco S.A. (NYSE: BBD)
Howard Marks looks bullish over the fundamentals of financial service company Banco Bradesco S.A. (NYSE: BBD). The value investor increased his position in BBD by 94% in the fourth quarter to 1.25% of the 13F portfolio. BBD is ranked at the fifth spot in the list of 10 best value stocks to buy now according to Howard Marks. Banco’s share price grew 39% in the last twelve months.
The number of long hedge fund bets on BBD declined by 3 recently. Banco Bradesco was in 17 hedge funds’ portfolios at the end of December. The all-time high for this statistic is 20.
4. ICICI Bank Limited (NYSE: IBN)
Oaktree first initiated a position in ICICI Bank Limited (NYSE: IBN) in 2014 and added to its existing stake in the fourth quarter of 2020. The share price of ICICI Bank grew 161% in the last five years and extended the upside momentum into 2021. Its stock price is up 9% so far in 2021. ICICI Bank generated net profit growth of 19% year over year in the latest quarter. The number of bullish hedge fund bets increased by 5 in recent months. ICICI Bank was in 29 hedge funds’ portfolios at the end of December. The all-time high for this statistics is 34.
3. Vale SA (NYSE: VALE)
Howard Marks raised his bet on iron ore mining company Vale SA (NYSE: VALE) by 55% in Q4 to 6.75 million shares. The firm first initiated a position in Vale during the third quarter of 2020. VALE is ranked third in the list of 10 best value stocks to buy now according to billionaire Howard Marks. The share price of the mining company surged almost 60% in the last six months alone. The rally in Vale’s stock price is backed by improving financial numbers and prospects for bigger dividends ahead. Vale SA was in 35 hedge funds’ portfolios at the end of December. The all-time high for this statistic is 36.
2. Itaú Unibanco Holding S.A. (NYSE: ITUB)
The Brazilian financial products and services provider Itaú Unibanco Holding S.A. (NYSE: ITUB) stock fell sharply this year amid concerns over increasing virus cases in the region. Howard Marks first initiated a position in Itaú Unibanco in 2014. However, Oaktree now looks more confident about the Brazilian financial services company. The hedge fund increased its position by 29% in ITUB in the latest quarter to 2.62% of the overall portfolio.
Itaú Unibanco operates through three segments: Retail Banking, Wholesale Banking, and Activities with the Market + Corporation. Along with various deposit products, the company offers loans and credit cards. The company also offers investment banking services, real estate lending services, and leasing and foreign exchange services.
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.
