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Tom Gayner's Stocks trading at Low P/E

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Apr 09, 2015
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Tom Gayner (Trades, Portfolio) is the Executive Vice President and Chief Investment Officer Of Markel Corp and President, Markel Gayner Asset Management, Inc., the investment subsidiary Of Markel Corp since December of 1990. The asset under management is about $4 billion, is composed of 107 stocks and the stocks that are trading with the lower P/E are Graham Holdings Co (GHC), Fairfax Financial Holdings Ltd (FRFHF), National Oilwell Varco Inc (NOV), Travelers Companies Inc (TRV), Nicholas Financial Inc (NICK) and Exxon Mobil Corporation (XOM)

Graham Holdings Co (GHC)

Gayner bought GHC for the first time in 2013Q4 and then sold few quantity in 2014 Q1. Now he is holding 5,200 shares at an average price of $640.66 per share (with a current gain of +65.40%).
 

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The stock is currently trading at 5.70 of P/E that is very cheap level compared to the Industry Median’s P/E of 218.00. The price is hitting the 52 Weeks High (-3.97%), while is +63.38%from its 52 Weeks Low. Since 12 months back, the price rose by +53%

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Over the last 5 years, Revenue is almost the same (+0.90%) while EBITDA grew by19.20% .

The DCF model, gives a fair value of $1248.65 with a current margin of safety of 15%.

Mason Hawkins is the bigger holder of GHC (12.63% of Shares Outstanding), followed by Charles de Vaulx (1.19%) and Tom Russo (1.02%).

Fairfax Financial Holdings Ltd (FRFHF)

He bought FRFHF on 2010Q1 and now he is holding 146,436 shares at an average price of $361.41 per share. (with a gain of +54.90%).
 

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The stock is currently trading at 8.80 of P/E+32.80% from its 52 Weeks Low and -5.25% from its 52 Weeks high. Since 12 months back, the price rose by 29% .

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Over the last 5 years, Revenue (+5.50%) and Book Value (+1.80%) didn’t face important changes. Just over the last 12 months they are having a good jump; Revenue +70.90% and Book Value +31.00%.

The DCF model, with a fair value of $1096.59 suggest the company is trading with a current margin of safety of 49%

National Oilwell Varco Inc (NOV)

He is buying NOV since Q3 2010 and since that time he buys new stakes every quarter, while the price go down. Now he holds 475,000 shares at an average price of $69.8 per share (with a current loss of -22%).

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The stock is currently trading at 9.10 of P/E, +18.62% from its 52 Weeks Low and -36.85% from its 52 Weeks high. During the last 12 months, the price dropped by 23%.

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Over the last 5 years, Revenue grew by 12.40% and EBITDA by 9.40 % and this trend is confirmed even during the last 12 months. The company looks Undervalued based on the DCF model that gives a fair value of $ 164.83 with a current margin of safety of 68 %

Dodge & Coxis the bigger holder of NOV with 3.48% of Shares Outstanding, followed by Jean-Marie Eveillard(holding 13,540,058 shares, 3.3% of Shares Outstanding) andFrank Sands (10,816,658 shares, 2.64% of Shares Outstanding).

Travelers Companies Inc (TRV)

During the year 2014 on every quarter he bought shares of TRV, reaching a total number of 244,000 at an average price of $93.29 per share (with a currently gain of 15%).
 

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The stock is currently trading at 10.10 of P/E+26.10% from its 52 Weeks Low and -3.18% from its 52 Weeks High. During the last 12 months, the price rose by 25% .

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Over the last 5 years, Revenue grew by 12.10% and EBITDA by 14.10% . The same growing trend is confirmed even during the last 12 months. The DCF Fair Value is $ 202.68 with a current margin of safety of 47 %

Mason Hawkins is the main holder of TRV (1.14% os Shares Outstanding), then Pioneer Investments and James Barrow hold the 0.33% and the 0.28%.

Nicholas Financial Inc (NICK)

He currently holds 45,000 shares of NICK at an average price of $12.49 per share (a gain of of +15%).
 

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The stock is currently trading with a P/E of 11.00 and the price is +34.12% from its 52 Weeks Low and -9.97% from its 52 Weeks High. During the last 12 months, the price dropped by -10% .

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Over the last 5 years, Revenue grew by 9.20% and EBITDA by 18.60%.

The DCF fair value is $18.64 with a current margin of safety of 23%

Jim Simons (Trades, Portfolio) and Tom Gayner (Trades, Portfolio) are the only gurus holding NICK with 3.28% and 0.37% of Shares Outstanding.

Exxon Mobil Corporation (XOM)

He is buying XOM since 2010 Q1 and now he is holding 868,800 total shares at an average price of $72.96 per share (currently facing a gain of +15%).
 

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XOM is currently trading at a P/E ratio of 12.20, +2.96%from its 52 Weeks Low and -18.74% from its 52 Weeks high. Since 12 months back, the price dropped by -13% .

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Over the last 5 years, Revenue grew by 8.30 and EBITDA by 9.70. The DCF model says the company is fairly valued at current prices (a current margin of safety of -3%).

Donald Yacktman is the bigger holder of XOM (holding 7,011,924 shares, 0.17% of outstanding shares), followed by Brian Rogers (holding 5,664,200 shares, 0.14%of outstanding shares) andRichard Pzena(4,274,944 shares, 0.1 % of outstanding shares).

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