This morning we are going to take a look at stocks that are widely held by the gurus and trading near their 52-week lows:
eBay Inc. (EBAY, Financial) closed at $48.56 on 6/12/2014, near its 52-week low of $48.06. The company provides online platforms, tools, and services to help individuals and merchants in online and mobile commerce and payments in the United States and internationally. The company is facing stiff competition from Amazon and recent news stories indicate that Amazon and Apple will soon be competitors of their PayPal service. Activist investor, Carl Icahn (Trades, Portfolio), recently took a large stake in the company to help bring some life back into the stock. He was fighting for a spinoff of PayPal, and had a discussion with the CEO. After they met, Icahn backed off of his request, and is on board with the company’s plans. It is currently held by 35 of the gurus we follow.
Market Cap: 61.54 billion, P/E: N/A
Business Predictability: 4/5, Financial Strength: 8/10, Profitability & Growth: 8/10
Coach Inc. (COH, Financial) closed at $38.67 on 6/12/2014, near its 52-week low of $38.56. The company is one of the most recognizable fine accessories brands in the United States and in targeted international markets. They are known for the fashionable handbags and accessories that use high quality leathers, fabrics, and materials. The stock is trading at a low P/E of 11.70, but their most recent quarter saw a 6 percent drop in revenue and nearly a 20 percent decline in earnings per share. It is a bargain if the company can get back on track with increasing earnings. To justify its current price, earnings need to grow at an annual rate of 5.01 percent. The stock is held by 22 of the gurus we follow.
Market Cap: 10.60 billion, P/E: 11.70
Business Predictability: 3.5/5, Financial Strength: 7/10, Profitability & Growth: 8/10
Staples Inc. (SPLS, Financial) closed at $11.10 on 6/12/2014, near its 52-week low of $10.86. It pioneered the office products superstore in 1986 and currently serves businesses of all sizes and consumers in North America, Europe, Australia, South America, and Asia. The company’s stock has been in decline since the Great Recession, and it does not help that earnings declined by over 40 percent in the last quarter. Staples debt level is low, so they have the financial ability to hang around until they can figure out how to improve their earnings. The stock is held by 19 of the gurus we follow.
Market Cap: 7.18 billion, P/E: 13.00
Business Predictability: 1/5, Financial Strength: 8/10, Profitability & Growth: 6/10
Bed Bath & Beyond (BBBY, Financial) closed at $60.33 on 6/12/2014, near its 52-week low of $60.15. The company is a retailer that operates under the names of Bed Bath & Beyond, Christmas Tree Shops andThat!, Harmon Face Values, buybuy BABY, and World Market. It sells a wide assortment of domestics merchandise and home furnishings. The stock is down 25 percent year-to-date, but has been holding support at about $60 per share. Earnings were slightly down by 5 percent in the latest quarter. The United States faced a negative GDP in the first quarter and Bed Bath & Beyond still had positive growth in same store sales. I think the stock can turn around. The GuruFocus DCF calculator shows a fair value of $87.07 with a margin of safety of 31 percent. The stock is currently held by 16 of the gurus we follow.
Market Cap: 12.32 billion, P/E: 12.90
Business Predictability: 4/5, Financial Strength: 9/10, Profitability & Growth: 8/10
Gaming and Leisure Properties (GLPI, Financial) closed at $32.94 on 6/12/2014, near its 52-week low of $32.70. The company is a recent spin-off from Penn National Gaming. It now owns the properties of Penn National and is collecting lease payments. The now independent company is looking to acquire more gaming real estate and is open to lease the properties to other casino operators. Gaming and Leisure is also interested in expanding outside of casino gaming. The large drop in the stock price in January was due to a special dividend of $11.84. The company has not had a full year of operations on its own yet, but analyst are estimating 2014 FY EPS of 2.53. With the estimated EPS, the company needs to grow 8 percent annually to justify its current price, but analysts are only calling for a 5.5 percent increase in earnings for 2015. The stock is held by 12 of the gurus we follow.
Market Cap: 3.68 billion, P/E: 68.00
Business Predictability: Not Rated, Financial Strength: 5/10, Profitability & Growth: 4/10
