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Bargain Stocks Among Pioneer Investments' Holdings

Six stocks trading at a discount of more than 50%

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Nov 02, 2015
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Pioneer Investments operates in wide areas of investment vehicles: Mutual Funds, Single Manager Hedge Funds, Funds of Hedge Funds, Structured Products, Segregated and Managed Accounts, Institutional Funds.

The current portfolio is composed of 567 stocks and has a total value of $26.705 million. The following are the stocks trading with a wide margin of safety according to the GuruFocus DCF calculator.

Helmerich & Payne Inc. (HP)

The company is engaged in contract drilling of oil and gas wells for others and in the ownership, development and operation of commercial real estates. Its business is composed of three reportable segments: U.S. Land, Offshore and International Land.

Helmerich & Payne is trading at about $56 with a trailing 12-month P/E multiple of 10.10 and an estimated forward P/E multiple of 138.89. Over the last 10 years, the stock has risen by 95%, and during the past year, the price has been as high as $37.02 and as low as $21.90. The DCF calculator gives a fair value of $159.14 that puts the stock as undervalued with a margin of safety of 65% at current prices.

Even so the industry has endured an unprecedented rig count decline, and yet it believes that the company remains well positioned, in which the company’s international land operations reported segment operating income grew by $11.1 million compared to last year’s third fiscal quarter.

The firm

First Pacific Advisors (Trades, Portfolio) is the main shareholder of the company with a stake of 1.05% of outstanding shares, followed by the investor Chuck Royce (Trades, Portfolio) with 0.94% and the firm FPA Capital Fund (Trades, Portfolio) with a stake of 0.69%.

Nu Skin Enterprises Inc. (NUS)

The company is a global direct selling company with operations in 53 markets worldwide. NUS develops and distributes innovative, premium-quality anti-aging personal care products and nutritional supplements under its Nu Skin and Pharmanex category brands, respectively.

Nu Skin Enterprises is trading at about $38 with a trailing 12-month P/E multiple of 11.80 and an estimated forward P/E multiple of 10.60. Over the last 10 years, the stock has risen by 121%, and during the past year, the price has been as high as $39.22 and as low as $12.28. The DCF model gives a fair value of $92.24 that puts the stock as undervalued with a margin of safety of 59% at current prices. The Peter Lynch earnings line gives the company a fair price for the stock of $45.4.

During the third quarter the business continued to progress sequentially in each quarter of 2015, with constant-currency revenue improving in the third quarter to be even with the prior year, in which total revenues grew by 11% and total sales increased by 6% compared to the same quarter of a year before.

Chuck Royce (Trades, Portfolio) is the main shareholder of the company with 3.9% of outstanding shares, followed by Pioneer Investments (Trades, Portfolio) which holds a small stake of 0.12%.

Viacom Inc. (VIAB)

The company is an entertainment content company that connects with audiences through television content across television, motion picture, online and mobile platforms in more than 165 countries and territories.

Viacom is trading at about $49 with a trailing 12-month P/E multiple of 12.10and an estimated forward P/E multiple of 8.61. Over the last 10 years, the stock has risen by 15%, and during the past year, the price has been as high as $36.78 and as low as $35.77.

The DCF model gives a fair value of $121.27 that puts the stock as undervalued with a margin of safety of 59% at current prices. The Peter Lynch earnings line gives a fair price for the stock of $63.4.

For the last quarter, due to lower theatrical revenues in Filmed Entertainment, quarterly revenues declined 11%, adjusted diluted earnings per share for the quarter increased 4% and adjusted net earnings attributable to Viacom declined 4%.

Donald Yacktman (Trades, Portfolio) is the company's leading shareholder among the gurus with a stake 2.33% of outstanding shares, followed by Warren Buffett with 1.42% and

Yacktman Fund (Trades, Portfolio) with 1.19%.

Western Digital Corp. (WDC)

The company is a developer, manufacturer and provider of data storage solutions that enable consumers, businesses, governments and other organizations to create, manage, experience and preserve digital content.

Western Digital Corp. is trading at about $66 with a trailing 12-month P/E multiple of 10.80 and an estimated forward P/E multiple of 10.00. Over the last 10 years, the stock has risen by 428%, and during the past year, the price has been as high as $41.74 and as low as $1.12.

The DCF model gives a fair value of $149.87 that puts the stock as undervalued with a margin of safety of 55% at current prices. The Peter Lynch earnings line gives to the company a fair price for the stock of $95.3.

Western Digital is pleased with executi on and performance in the first fiscal quarter in which the company generated $545 million in cash from operations during the first fiscal quarter.

The company's leading shareholder among the gurus is

Charles Brandes (Trades, Portfolio) with a stake 0.69% of outstanding shares, followed by First Pacific Advisors (Trades, Portfolio) with 0.49% and the investor Joel Greenblatt (Trades, Portfolio) with 0.36%.

Credicorp Ltd. (BAP)

The company, through its banking and nonbanking subsidiaries, provides financial and health services and products mainly throughout Peru and in certain other countries. The company operates in four segments namely Banking, Insurance, Pension fund and Investment banking

Credicorp is trading at about $113 with a trailing 12-month P/E multiple of 11.00 and an estimated forward P/E multiple of 8.46. Over the last 10 years, the stock has risen by 299%, and during the past year, the price has been as high as $33.75 and as low as $38.40.

The DCF model gives a fair value of $249.41 that puts the stock as undervalued with a margin of safety of 55% at current prices. The Peter Lynch earnings line gives to the stock a fair price of $158.5.

During the last quarter BAP reported net interest income with growth of 2.9% quarter over quarter and 14.1% year over year. The company reported a solid financial margin, which was 5.70%. This level was slightly lower than the 5.73% posted in first quarter but was higher than the 5.67% for the second quarter of a year before.

Ken Fisher (Trades, Portfolio) is the company's leading shareholder among the gurus with a stake 1.42% of outstanding shares, followed by Jim Simons (Trades, Portfolio) with 0.3% of outstanding shares and Frank Sands (Trades, Portfolio) with a small stake of 0.12%.

Cummins Inc. (CMI)

The company designs, manufactures, distributes and services diesel and natural gas engines and engine-related component products, including filtration, aftertreatment, turbochargers, fuel systems, controls systems, air handling systems and electric power generation systems.

Cummins is trading at about $103 with a trailing 12-month P/E multiple of 11.10 and an estimated forward P/E multiple of 10.99. Over the last 10 years, the stock has risen by 377%, and during the past year, the price has been as high as $31.56 and as low as $3.76.

The DCF model gives a fair value of $215.19 that puts the stock as undervalued with a margin of safety of 52% at current prices. The Peter Lynch earnings line gives a fair price for the stock of $141.4.

During the third quarter revenue decreased 6% from the same quarter in 2014 and a stronger U.S. dollar, currency negatively impacted sales by 4% compared to last year. For the full year, revenue expected to be flat to down 2% and EBIT to be in the range of 12.75 to 13.0% of sales.

The firm HOTCHKIS & WILEY with a stake of 2.07% of outstanding shares is the main shareholder of the company, followed by

David Rolfe (Trades, Portfolio) with 0.98% and Pioneer Investments (Trades, Portfolio) with 0.56%.

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