Jeremy Grantham (Trades, Portfolio) is the chairman and co-founder of the investment firm Grantham, Mayo, Van Otterloo & Co. LLC. The company runs one of the largest investment funds in the world with more than $104 billion in firm-wide assets under management. In the third quarter of 2015, Grantham purchased 1,553,174 shares of Valero Energy Corp. (VLO, Financial) and 1,560,700 shares of Royal Bank of Canada (RY, Financial).
The graph below shows the price movement of Valero Energy Corp.
Valero Energy is an international manufacturer and marketer of transportation fuels, petrochemical products and power. Valero Energy employs over 10,000 people worldwide and their assets include 15 petroleum refineries with a capacity to manufacture 2.9 million barrels of oil per day. They also own 11 ethanol plants with a combined production capacity of 1.4 billion gallons per year.Â
Valero Energy has a market cap of $33.91 billion, a P/E ratio of 6.84, an enterprise value of 36.41, a quick ratio of 1.24 and a dividend yield of 2.36%.
Below is a Peter Lynch chart for Valero Energy Corp.
Valero Energy is trading far below the Peter Lynch earnings line and is a very attractive holding.
Valero Energy has three good signs according to GuruFocus:
- Piotroski F-Score of 7 indicates a very healthy financial situation.
- Operating margin is expanding.Â
- The dividend yield is close to the three-year high.
The graph below shows the price movement for Royal Bank Of Canada.
The Royal Bank of Canada offers bank accounts, credit cards, mortgages, loans and investments globally. Royal Bank of Canada operates 116 branches in 19 countries and territories across the world.
The Royal Bank of Canada has a market cap of $77.97 billion, an enterprise value of $65.84 billion, a P/E ratio of 11.09 and a dividend yield of 4.44%.
Below is a Peter Lynch chart for Royal Bank of Canada.
The Royal Bank of Canada has a four-star predictability ranking according to GuruFocus and four good signs about the company:
- Royal Bank of Canada has shown predictable revenue and earnings growth.
- Operating margin is expanding.
- P/E ratio of 11.52 is close to the three-year low of 10.73.
- P/B ratio of 1.91 is close to the five-year low of 1.79.
I have been a client of the Royal Bank of Canada for many years, and they have excellent customer service to go along with all of these good signs.
Cheers to your investment success.
Disclaimer: Author does not currently own either of these holdings.
