Nygren on the Value in Financials

Top fund manager Bill Nygren says he’s continuing to find the best value in the market in the financial sector. While the much-maligned sector isn’t the sexiest right now, Nygren says that doesn’t matter to him. What does matter is value. “We own the financials because they are the cheapest stocks with the highest quality management,” he told CNBC. “We don’t wake up in the morning thinking we want to put money to work in… Read More

Nygren Talks Value, Opportunity, And The End Of QE

Worried about the end of quantitative easing? Top fund manager Bill Nygren isn’t. In an interview with MoneyLife’s Chuck Jaffe, Nygren says that his firm’s five-year-holding-period, value-focused, bottom-up approach means that the exact timing of the tapering of the Federal Reserve’s bond-buying program “ends up not really being an important factor,” adding, “We certainly think the markets can handle it.” Nygren says his firm tends to go into areas where there is controversy today, but… Read More

Nygren Talks Value

Bill Nygren, whose Oakmark Select fund is in the top 2% of its peers over the past 5 and 15 years, recently talked with CNBC about his approach and some of his favorite current stocks. “When you’re a long-term value investor like we are at Oakmark, we end up buying things that had been disappointing for others,” he said, discussing why his fund owns beaten-down Qualcomm shares. He also talks about some of his fund’s… Read More

Two Gurus High on Bank Stocks

Five years after the collapse of Lehman Brothers sparked the financial crisis, many investors still don’t trust bank stocks. Top fund managers Bill Nygren and David Ellison think that is part of why it’s time to buy them. “The stocks are still low because investors don’t trust that the earnings will recover fully,” Ellison tells Renal and Urology News. (An odd source, we know, but they have a solid ‘Money’ section.) He notes that bank… Read More

Buyback Stocks or Dividend Plays? Nygren Weighs In

When companies put cash to work to increase shareholder value, it can be a very good thing. But top fund manager Bill Nygren says certain types of cash deployers are looking more attractive than others right now. “One of the things we think investors have gone a little excessive on is bidding up companies that pay high yields, good income generators,” he recently told CNBC in discussing high-dividend stocks. “And we think it’s interesting that companies that… Read More

Nygren: Stocks Still Attractive

Have rising bond yields made stocks less attractive? No, says top fund manager Bill Nygren of Oakmark. In his second-quarter client letter, Nygren discusses the “Dividend Discount Model” his firm uses to assess stock values. According to the model (one of several Oakmark uses), the combination of dividend yield and dividend growth must be equal to an investor’s required return. The required return, he says, is a combination of a “risk-free asset” (Nygren uses the… Read More

Nygren: Dividends Will Be Key

In his first-quarter letter to shareholders, top fund manager Bill Nygren of Oakmark says that he’s keying on companies that are putting their cash to work. “Corporations today have unusually strong balance sheets and are generating much more cash than they can profitably reinvest in their own businesses,” Nygren writes. “Unless managements just let the piles of cash keep growing, which is clearly suboptimal, there are only three ways to deploy it: higher dividends, share… Read More

Nygren: Stocks Best Place for Long-Term

Top fund manager Bill Nygren of Oakmark says he thinks stocks are “easily the best alternative out there for long-term money”. Nygren tells CNBC that with stocks yielding more than bonds, P/E ratios below historical averages, and balance sheets as good as ever, “I think all the signs are positive” for stocks. He also talks about some of his biggest holdings, including Bank of America and Dell.

The Benefits of Turnaround Firms

If you are looking for places to invest as the current bull market ages, try turnaround stocks, says The Wall Street Journal’s Jack Hough. Hough says that several turnaround firms — those that have had big problems and are now trading on the cheap — have had big years in 2012. Among them are several homebuilders, as well as Gap and Sprint Nextel. Hough says that turnarounds are attractive not only because they can produce… Read More