Doug Kass, founder and president of Seabreeze Partners was on CNBC to discuss his views on the market rally, whether it is over without the Fed stimulus and what his investment strategy is going forward.
He said "The market is probably 5-8% overvalued." As the Fed puts a freeze on extra liquidity, he thinks the rally will halt and it is time to get defensive with cash and high-cash flow generating global franchises which have lagged the market and are available at low P/E ratios relative to the market.
He said, "Stocks that I like are the large-free cash flow generators that have dominant global franchises and therefore protective moats. They’re conservative companies but I like the reward versus the risk because the P/Es have been deflated over the past 5-10 years."
Here is the video:
About the author:
I am an individual investor with deep interest in the field of value investing. My ideas and thinking is inspired by highly respected value investors like Ben Graham, Warren Buffett, Walter Schloss, Bill Ruane and Tweedy Browne
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