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Donald Smith Buys Low P/B Stocks: EXC, WPX, AAV, RSH, VLO
Posted by: GuruFocus (IP Logged)
Date: May 14, 2012 08:38AM

Donald Smith measures the valuation of companies with price to book (P/B) ratios. He loves to buy good companies that are sold at historical low P/B ratios. In the first quarter, he bought five new positions that are sold that low P/B ratios. Buying stocks at low P/B ratios was also an original idea of Ben Graham. Donald Smith’s firm found that from 1951 to 2009 stocks in the lowest price-to-tangible book value decile had the highest long-term returns, delivering a 15.4% return versus 10.7% for the S&P 500.


Donald Smith buys Exelon Corp, WPX Energy Inc, Xl Group Plc, Adv Oil&Gas Ltd, Radioshack Corp, AbitibiboWater etc during the 3-months ended 03/31/2012, according to the most recent filings of his investment company, Donald Smith & Co. As of 03/31/2012, Donald Smith & Co. owns 94 stocks with a total value of $3.4 billion. These are the details of the buys and sells.

For the details of Donald Smith's stock buys and sells, go to http://www.gurufocus.com/StockBuy.php?GuruName=Donald+Smith

These are the top 5 holdings of Donald Smith

  1. Dillards Inc-A (DDS) - 3,626,897 shares, 6.6% of the total portfolio. Shares reduced by 10.25%
  2. Ingram Micro (IM) - 9,909,259 shares, 5.3% of the total portfolio. Shares added by 1.02%
  3. Micron Tech (MU) - 22,055,146 shares, 5.2% of the total portfolio. Shares reduced by 1.88%
  4. Jetblue Airways (JBLU) - 29,522,839 shares, 4.2% of the total portfolio. Shares reduced by 1.31%
  5. Mi Devlpmnts -A (MIM) - 4,059,745 shares, 4.1% of the total portfolio. Shares reduced by 13.62%


New Purchase: Exelon Corp (EXC)

Donald Smith initiated holdings in Exelon Corp. His purchase prices were between $38.46 and $42.07, with an estimated average price of $37.13. The impact to his portfolio due to this purchase was 2.8%. His holdings were 2,475,608 shares as of 03/31/2012. Exelon Corp has a market cap of $33.12 billion; its shares were traded at around $38.91 with a P/E ratio of 10.13 and P/S ratio of 1.73. The dividend yield of Exelon Corp stocks is 5.4%. Exelon Corp had an annual average earnings growth of 8.5% over the past 10 years.

New Purchase: WPX Energy Inc (WPX)

Donald Smith initiated holdings in WPX Energy Inc. His purchase prices were between $14.75 and $19.67, with an estimated average price of $16.61. The impact to his portfolio due to this purchase was 1.7%. His holdings were 3,198,595 shares as of 03/31/2012. WPX Energy, Inc. is a natural gas and oil company focused on the exploitation and development of unconventional properties. WPX Energy Inc has a market cap of $3.46 billion; its shares were traded at around $17.43 with and P/S ratio of 0.87.

New Purchase: Adv Oil&gas Ltd (AAV)

Donald Smith initiated holdings in Adv Oil&gas Ltd. His purchase prices were between $3.31 and $4.38, with an estimated average price of $3.43. The impact to his portfolio due to this purchase was 0.97%. His holdings were 9,935,183 shares as of 03/31/2012. Advantage Oil and Gas Ltd., formerly Advantage Energy Income Fund, is an intermediate oil and natural gas corporation, engaged in the exploration and development of oil and natural gas properties in Alberta and Saskatchewan in Canada. Adv Oil&gas Ltd has a market cap of $518.04 million; its shares were traded at around $3.11 with and P/S ratio of 1.46.

New Purchase: RadioShack Corp (RSH)

Donald Smith initiated holdings in RadioShack Corp. His purchase prices were between $6.22 and $10.96, with an estimated average price of $7.49. The impact to his portfolio due to this purchase was 0.53%. His holdings were 2,950,129 shares as of 03/31/2012. RadioShack Corp has a market cap of $467.82 million; its shares were traded at around $4.72 with a P/E ratio of 9.61 and P/S ratio of 0.11. The dividend yield of RadioShack Corp stocks is 2.65%.

New Purchase: Valero Energy (VLO)

Donald Smith initiated holdings in Valero Energy. His purchase prices were between $19.61 and $28.56, with an estimated average price of $23.29. The impact to his portfolio due to this purchase was 0.41%. His holdings were 552,292 shares as of 03/31/2012. Valero Energy Corporation owns and operates refineries in the United States and Canada with a combined throughput capacity of approximately two million BPD, making it one of the nation's top refiners of petroleum products. Valero Energy has a market cap of $12.51 billion; its shares were traded at around $22.54 with a P/E ratio of 6.42 and P/S ratio of 0.1. The dividend yield of Valero Energy stocks is 2.66%. Valero Energy had an annual average earnings growth of 6.5% over the past 10 years.

Sold Out: Pinnacle West (PNW)

Donald Smith sold out his holdings in Pinnacle West. His sale prices were between $46.39 and $48.53, with an estimated average price of $44.6. Pinnacle West Capital is engaged, through its subsidiaries, in the generation, transmission, and distribution of electricity and selling energy, products and services; in real estate development; and in venture capital investment. Pinnacle West has a market cap of $5.31 billion; its shares were traded at around $48.6 with a P/E ratio of 15.88 and P/S ratio of 1.64. The dividend yield of Pinnacle West stocks is 4.32%. Pinnacle West had an annual average earnings growth of 2.3% over the past 5 years.

Sold Out: Semicon Mfg-adr (SMI)

Donald Smith sold out his holdings in Semicon Mfg-adr. His sale prices were between $2.33 and $2.86, with an estimated average price of $2.41. SEMICONDUCTOR MANUFACTURING INTERNATIONAL CORPORATION is one of the semiconductor foundries in the world and the largest and most advanced foundry in Mainland China, providing integrated circuit manufacturing service at 0. Semicon Mfg-adr has a market cap of $1.33 billion; its shares were traded at around $2.42 with and P/S ratio of 1.01.

Sold Out: Carrols Restaurant (TAST)

Donald Smith sold out his holdings in Carrols Restaurant. His sale prices were between $11.02 and $15.42, with an estimated average price of $11.28. CARROLS RESTAURANT GROUP, INC., operating through its subsidiaries, including Carrols Corporation, is one of the largest restaurant companies in the United States. Carrols Restrnt has a market cap of $130.39 million; its shares were traded at around $5.65 with a P/E ratio of 7.41 and P/S ratio of 0.16.

Sold Out: Sprint Nextel (S)

Donald Smith sold out his holdings in Sprint Nextel. His sale prices were between $2.12 and $2.98, with an estimated average price of $2.3. Sprint Nextel offers a comprehensive range of wireless and wireline communications services to consumer, business and government customers. Sprint Nextel has a market cap of $7.46 billion; its shares were traded at around $2.48 with and P/S ratio of 0.22.

Here is the complete portfolio of Donald Smith. Also check out the Undervalued Stocks, Top Growth Companies, and High Yield stocks of Donald Smith.




Guru Discussed: Donald Smith: Current Portfolio, Stock Picks
Stocks Discussed: EXC, WPX, AAV, RSH, VLO,
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