Buying stocks at historically low price-to-book (P/B) ratios has been an effective strategy. The model portfolio, “Top 25 Historical Low P/B Ratio Companies”, has outperformed the S&P 500 by 25.44 percent since its inception in 2010. The following stocks are the most widely held stocks by the investing gurus we follow that are trading near their historical low P/B ratios:
Kellogg Co (K) is trading at a low P/B ratio of 6.80, near its 10-year low of 5.92. The company is well-known for its cereal and offers other convenience foods. Some of the other brands it markets are Keebler, Cheez-It, Murray, Austin and Famous Amos. The stock is held by 17 gurus we follow with Hotchkis & Wiley holding the largest position of 2.43 million shares, representing 0.68 percent of the shares outstanding.
Market Cap: 23.76 billion, P/E: 12.70
Business Predictability: 4/5, Financial Strength: 6/10, Profitability & Growth: 8/10
Intercontinental Exchange Inc (ICE) is trading at a low P/B ratio of 1.70 near its 10-year low of 1.64. The company is a leading global network of regulated exchanges and clearing houses for financial and commodity markets. It operates global marketplaces for trading and clearing a broad array of securities and derivative contracts across major asset classes, including interest rates, equities, equity derivatives, credit derivatives, bonds, currency, and commodities. It completed its acquisition of NYSE Euronext in November of 2013. The stock is held by 14 gurus we follow with Steve Mandel of Lone Pine Capital holding the largest position of 3.32 million shares, representing 2.88 percent of the shares outstanding. He is also holding call options on the stock.
Market Cap: 22.91 billion, P/E: 45.30
Business Predictability: 2/5, Financial Strength: 5/10, Profitability & Growth: 7/10
Bio-Rad Laboratories (BIO) is trading at a low P/B ratio of 1.50, near its 10-year low of 1.45. The company manufactures and supplies the life science research, healthcare, analytical chemistry and other markets with a broad range of products and systems used to separate complex chemical and biological materials to identify, analyze and purify their components. The stock is held by 11 gurus we follow with John Rogers of Ariel Investment holding the largest position of 1.02 million shares, representing 3.56 percent of the shares outstanding.
Market Cap: 3.42 billion, P/E: 54.30
Business Predictability: 3/5, Financial Strength: 6/10, Profitability & Growth: 6/10
Haemonetics Corp (HAE) is trading at a low P/B ratio of 2.20, near its 10-year low of 1.94. The global healthcare company provides innovative blood management solutions to its customers. The stock is held by 9 gurus we follow with James Barrow of Barrow, Hanley, Mewhinney & Strauss holding the largest position of 3.04 million shares, representing 5.85 percent of the shares outstanding.
Market Cap: 1.84 billion, P/E: 52.40
Business Predictability: 2/5, Financial Strength: 6/10, Profitability & Growth: 7/10
Waters Corp (WAT) is trading at a low P/B ratio of 4.90, near its 10-year low of 4.61. The company is an analytical instrument manufacturer. Its products are used by pharmaceutical, life science, biochemical, industrial, nutritional safety, environmental, academic and governmental customers working in research and development, quality assurance and other laboratory applications. The stock is held by 9 gurus we follow with Ruane Cunniff of Ruane, Cunniff & Goldfarb Inc holding the largest position of 2.07 million shares, representing 2.45 percent of the shares outstanding.
Market Cap: 9.15 billion, P/E: 23.40
Business Predictability: 4/5, Financial Strength: 8/10, Profitability & Growth: 8/10
For the complete list of stocks are traded at close to their historical low P/B ratios, go to: GuruFocus Value Strategies of Stocks That Are Traded at Historical Low P/B.
