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Tiziano Frateschi
Tiziano Frateschi
Articles (2657)  | Author's Website |

5 Defensive Companies Trading With Low Price-Earnings Ratios

Big Lots makes the list

As of June 9, the GuruFocus All-in-One Screener, a Premium feature, found that the following defensive stocks have low price-earnings ratios and have been bought by gurus. While some of them are great value investments, others may need to be researched more carefully, according to the Peter Lynch fair value..

Alico

With a market cap of $243 million, Alico Inc. (ALCO) has a price-earnings ratio of 6.54. According to the Peter Lynch earnings line, the stock has a fair value of $74.40 while trading at $32.48.

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The stock has gained 19.59% over the last 12 months and is now 4.54% below the 52-week high and 44.97% above the 52-week low.

The land management company has a GuruFocus profitability rating of 6 out of 10. The return on equity of 20.03% and return on assets of 8.83% are outperforming 83% of companies in the consumer packaged goods industry. Its financial strength is rated 5 out of 10. The cash-debt ratio of 0.37 is below the industry median of 0.4.

The company’s largest guru shareholder is Third Avenue Management (Trades, Portfolio) with 1.88% of outstanding shares, followed by Jim Simons (Trades, Portfolio)’ Renaissance Technologies with 1.58%.

Adtalem Global Education

With a $1.8 billion market cap, Adtalem Global Education Inc. (ATGE) is trading with a price-earnings ratio of 8.83. According to the Peter Lynch Value, the stock has a fair price of $41.24 while trading at $35.84.

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The share price has declined 20.4% over the past 12 months and is now 30.91% below the 52-week high and 81.07% above the 52-week low.

The educational company has a GuruFocus profitability rating of 7 out of 10. The return on equity of 16.40% and return on assets of 9.42% are outperforming 76% of companies in the education industry. Its financial strength is rated 5 out of 10. The cash-debt ratio of 0.26 is below the industry median of 1.25.

John Rogers (Trades, Portfolio) is the company’s largest guru shareholder with 5.46% of outstanding shares, followed by Charles de Vaulx (Trades, Portfolio) with 4.37%.

Big Lots

With a market cap of $1.3 billion, Big Lots Inc. (BIG) is trading with a price-earnings ratio of 4.95 and a price-book ratio of 1.56. According to the Peter Lynch earnings line, the stock has a fair value of $105.90 while trading at about $35.03.

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Shares have gained 36% over the last 12 months and are now 18.14% below the 52-week high and 242% above the 52-week low.

The company has a GuruFocus profitability rank of 8 out of 10. The company's return on equity of 36.5% and return on assets of 8.54% are outperforming 87% of competitors in the retail, defensive industry. Its financial strength is rated 5 out of 10.The cash-debt ratio of 0.18 is below the industry median of 0.33.

The company’s largest guru shareholder is Lee Ainslie (Trades, Portfolio)’s Maverick Capital with 1.09% of outstanding shares, followed by HOTCHKIS & WILEY and Robert Olstein (Trades, Portfolio) with 0.23%.

BellRing

BellRing Brands Inc. (BRBR) has a market cap of $821 million and is trading with a price-earnings ratio of 5.25. According to the Peter Lynch earnings line, the stock has a fair value of $59.40 while trading at about $20.26.

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Shares have jumped 22.7% over the last 12 months and are now trading 13.9% below the 52-week high and 52.58% above the 52-week low.

The company has a GuruFocus profitability rating of 4 out of 10. The return on assets of 20.6% are outperforming 90% of companies in the consumer packaged goods industry. Its financial strength is rated 3 out of 10. The cash-debt ratio of 0.1 is below to the industry median of 0.4.

With 0.67% of outstanding shares, Chuck Royce (Trades, Portfolio) is the company’s largest guru shareholder, followed by George Soros (Trades, Portfolio) with 0.04%.

Campbell Soup

Campbell Soup Co. (CPB) has a market cap of $15 billion. Its shares are trading with a price-earnings ratio of 9.86. According to the Peter Lynch earnings line, the stock has a fair value of $24.75 while trading at $49.89.

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Share prices have advanced 18.24% over the past 12 months and are currently trading 13.56% below the 52-week high and 41.03% above the 52-week low.

The soup and snacks producer has a GuruFocus profitability rating of 7 out of 10. The return on equity of 88.78% and return on assets of 11.91% are outperforming 80% of competitors in the consumer packaged goods industry. Its financial strength is rated 3 out of 10. The cash-debt ratio of 0.01 is below the industry median of 0.4.

The company’s largest guru shareholder is Renaissance Technologies with 0.62% of outstanding shares, followed by Pioneer Investments (Trades, Portfolio) with 0.15% and Joel Greenblatt (Trades, Portfolio)’s Gotham Asset Management with 0.15%.

Industrias Bachoco

Industrias Bachoco SAB de CV (IBA) has a market cap of $1.8 billion. Its shares are trading with a price-earnings ratio of 8.15 and a price-book ratio of 0.97. According to the Peter Lynch earnings line, the stock has a fair value of $73.35 while trading at $39.01.

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Shares have declined 25.86% over the past 12-month period and are currently trading 33% below the 52-week high and 36.20% above the 52-week low.

The company has a GuruFocus profitability rating of 8 out of 10. The return on equity of 12.64% and return on assets of 9.17% are outperforming 74% of companies in the consumer packaged goods industry. Its financial strength is rated 8 out of 10. The cash-debt ratio of 4.78 is far above the industry median of 0.4.

The company’s largest guru shareholder is Simons’ firm with 1.3% of outstanding shares, followed by Royce with 0.25%.

Disclosure: I do not own any stocks mentioned.

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About the author:

Tiziano Frateschi
You can read about me on www.theextraincome.info, which gives suggestions on position trading.

Visit Tiziano Frateschi's Website


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