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Low P/E Charles Brandes Stocks: XL Capital Ltd, SK Telecom Co. Ltd. , Gannett Co. Inc. , Flextronics International Ltd., Tele Norte Leste Participaes S.A.

December 22, 2008 | About:

Charles Brandes is the chairman of Brandes Investment Partners, a firm he started in 1974. In 2008, Forbes listed Charles Brandes as the No.462 Richest People in the World with a net worth of $2 billion.

Charles Brandes is a Benjamin Graham disciple. He consistently applies value investing to all portfolios managed by the Partnership. He seeks to purchase out-of-favor securities that are trading at discounts to their intrinsic values, and then hold them until the market recognizes their true worth.

As of September 30, 2008, GuruFocus.com found Charles Brandes owned 206 stocks and had $27.58 Billion invested among them. Of these 206 stocks, the following stocks has the lowest P/E ratio based on the current stock price (December 22, 2008) and earnings up to the past quarters:

XL Capital Ltd (XL) -- P/E = 0.7

XL Capital Limited provides excess liability insurance coverage to industrial commercial and other enterprises, directors and officers of such enterprises, and professional firms. It provides high excess property coverage and the assumption of reinsurance contracts on a worldwide basis.

XL Capital Ltd has a market cap of $886.51 million; its shares were traded at around $4 with a P/E ratio of 0.7 and P/S ratio of 0.1. The dividend yield of XL Capital Ltd stocks is 28.36%.

Charles Brandes initiated a position of about 10 million shares in XL in the third quarter of 2008(see table below).

Quarter ended on Value ($1000) Shares ( Split adjusted) Share Price ( Split adjusted)
20080930 178,959 9,975,393 $ 17.94


During the third quarter of 2008, besides Charles Brandes, Gurus HOTCHKIS & WILEY has increased their position to 21 million shares; Richard Snow kept his 5.6 million shares unchanged; Tom Gayner and Richard Pzena all have reduced their positions.

Recently, Executive Vice President James Howell Veghte bought 10,000 shares of XL stock on 10/23/2008 at the average price of $8.43; the price of the stock has decreased by 52.55% since.

SK Telecom Co. Ltd. (SKM) -- P/E = 1.8

SK Telecom Co. is a commercial CDMA digital cellular service in South Korea. SK Telecom Co. Ltd. has a market cap of $10.87 billion; its shares were traded at around $18.36 with a P/E ratio of 1.8 and P/S ratio of 0.85. SK Telecom Co. Ltd. had an annual average earning growth of 29.2% over the past 10 years.

Charles Brandes started to build a position in SKM from 2002 with a small purchase. He owned as much as 32.4 million shares on September 30, 2007. It appears he has been selling, albeit very slowly during the past year. As of September 30, 2008, he still have more than 26 million shares (see table below).

Quarter ended on Value ($1000) Shares ( Split adjusted) Share Price ( Split adjusted)
20080930 492,410 26,164,198 $ 18.82
20080630 565,778 27,240,180 $ 20.77
20080331 607,892 28,130,158 $ 21.61
20071231 858,015 28,753,838 $ 29.84
20070930 964,103 32,461,372 $ 29.7
20060930 594,729 25,275,348 $ 23.53
20050930 169,543 8,451,811 $ 20.06
20040930 10,173 517,711 $ 19.65
20030930 5,752 324,081 $ 17.75
20020930 5,971 283,651 $ 21.05


On September 30, 2008, Guru Jean-Marie Eveillard owned 14.9 million shares; Tweedy Browne owned 8.0 million shares. Mason Hawkins reduced his position to 4.8 million shares, a reduction of 76%.


Gannett Co. Inc. (GCI) -- P/E = 2

Gannett Co. Inc. is an international news and information company that publishes daily newspapers in the USA including USA TODAY the nation's largest-selling daily newspaper. The company also owns in excess of 400 non-daily publications in the USA and USA WEEKEND a weekly newspaper magazine. Gannett subsidiary Newsquest is the United Kingdom's second largest regional newspaper company. Newsquest publishes more than 300 titles including 15 daily newspapers and a network of prize-winning Web sites. Gannett also operates 22 television stations in the United States.

Gannett Co. Inc. has a market cap of $1.72 billion; its shares were traded at around $7.6 with a P/E ratio of 2 and P/S ratio of 0.23. The dividend yield of Gannett Co. Inc. stocks is 21.25%. Gannett Co. Inc. had an annual average earning growth of 4.9% over the past 10 years. GuruFocus rated Gannett Co. Inc. the business predictability rank of 3.5-star.

In recent year, Gannett has been under attach from internet, satellite TV, and wireless networks for its subscribers, and from google, ebay, craiglist, and other social networks for advertisement space. Gannett responded by leveraging on its balance sheet and acquiring more assets. The result is a mixed: its revenue grew at a pace of 7.3% during the past ten years but its earning has been stagnant.

Charles Brandes built his position in the past four years from 2.2 million shares on December 31, 2006 to 24.6 million shares on September 30, 2008 (see table below).

Quarter ended on Value ($1000) Shares ( Split adjusted) Share Price ( Split adjusted)
20080930 417,091 24,665,347 $ 16.91
20080630 547,961 25,286,634 $ 21.67
20080331 748,932 25,780,806 $ 29.05
20071231 996,696 25,556,295 $ 39
20061231 935,516 15,473,307 $ 60.46
20051231 142,662 2,207,018 $ 64.64


Besides Charles Brandes, many investment Gurus owned GCI on September 30, 2008: The ones who owned a significant portion include: John Rogers increased his position to 8.9 million shares, Warren Buffett owned 3.4 million shares, Brian Rogers owned 6 million shares.

However, Chris Davis sold out his holdings in the company during the quarter.

Recently, Director Neal Shapiro bought 1,000 shares of GCI stock on 12/17/2008; Director Scott K Mccune bought 1,500 shares of GCI stock on 12/12/2008; and Director Howard D Elias bought 1,000 shares of GCI stock on 11/05/2008.

Flextronics International Ltd. (FLEX) -- P/E = 2.3

Flextronic International is a leading provider of advanced electronics manufacturing services to OEMs primarily in the telecommunications and networking, consumer electronics, and computer industries. The company provides complete product design services including electrical and mechanical circuit and layout.

Flextronics International Ltd. has a market cap of $1.79 billion; its shares were traded at around $2.49 with a P/E ratio of 2.3 and P/S ratio of 0.06.

Charles Brandes started his position in FLEX during or before the fourth quarter of 2007, and as of September 30, 2008, he owned 15.1 million shares (see table below).

( The earliest time may not be the very begginning he started to own the stock)


Quarter ended on Value ($1000) Shares ( Split adjusted) Share Price ( Split adjusted)
20080930 107,186 15,139,324 $ 7.08
20080331 55,951 5,958,575 $ 9.39
20071231 103,990 8,622,681 $ 12.06


Besides Charlies Brandes, PRIMECAP Management owned 7.8 million shares of FLEX as of September 30, 2008.

Tele Norte Leste Participaes S.A. (TNE) -- P/E = 3.1

Tele Norte Leste Participacoes S.A., is a telecommunications company in Brazil and South America.

Tele Norte Leste Participaes S.A. has a market cap of $5.58 billion; its shares were traded at around $15.48 with a P/E ratio of 3.1 and P/S ratio of 0.43. The dividend yield of Tele Norte Leste Participaes S.A. stocks is 0.82%. Tele Norte Leste Participaes S.A. had an annual average earning growth of 22.2% over the past 5 years.

Charles Brandes has built his position in TNE since 1999 (see table below). He had as many as 34 million shares at the end of 2007 but has since then sold down to 23.7 million shares.

( The earliest time may not be the very begginning he started to own the stock)


Quarter ended on Value ($1000) Shares ( Split adjusted) Share Price ( Split adjusted)
20080930 414,652 23,748,665 $ 17.46
20080630 619,906 24,885,841 $ 24.91
20080331 776,117 29,243,291 $ 26.54
20071231 672,431 34,877,137 $ 19.28
20061231 382,208 25,617,173 $ 14.92
20051231 393,731 22,745,879 $ 17.31
20041231 343,733 21,700,309 $ 15.84
20031231 313,863 20,341,061 $ 15.43
20011231 232,539 14,634,303 $ 15.89
20001231 204,308 8,955,947 $ 22.81
19991231 118,184 4,634,657 $ 25.5





Rating: 3.7/5 (9 votes)

Comments

pigsgetrich
Pigsgetrich - 5 years ago
I wonder if this guy will become like Bill Miller.

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