January 24, 2008
In our talks with portfolio managers this week, we spoke to Peter Swan of Managed Asset Portfolios- an asset management company out of Rochester, Michigan that takes a multi-cap approach and looks for low price to earnings ratio, high return on assets, and high return on equities. He gave us five picks from his sector of coverage, International Stocks:
- Guinness Anchor Berhad (Malaysia)- “It’s got a 8.4% dividend yield and trades at around 12 times forward numbers; essentially you’re looking at return on assets of about 21% there, return on equity at 30%, and the company’s debt free.”
- Lotte Confectionery (China)- “Lotte has a pretty interesting partnership right now with Hershey (HSY) and they’ve done a good job on the candy side throughout the Asian region…It’s trading at about 15 times forward numbers, 1.7 times sales, 1.2 times book, and they also have a portfolio of other assets including interests in some of the other Lotte assets, which include things like shopping centers and retail stores.”
- Paris Orleans (France)- “What you’re getting there is a piece of a great financial services business, some spectacular wine assets along with a variety of other investments.”
- Lafarge (France)- “On the cement side and aggregate side, Lafarge, with their recent announced acquisition of Orascom, really seems to have the ball rolling, so we think that’s a name that makes a lot of sense. Also the construction business and the overall infrastructure play make a lot of sense to us globally.”
- Oishi Group PCL (Thailand)- ”This company is involved in tea products; they make ready to drink tea products and they also have a restaurant division, which is involved in operating a Japanese buffet under the Oishi name…In the big scheme of things, they’ve done a very good job on the beverage side with green tea products and the stock’s not overly expensive either, trading at roughly 10 times forward numbers. That one has a yield of 5% in Thai baht and you’re talking about a company that has virtually no debt at all and a pretty solid return on equity and return on assets.”
For the full investing strategies report, including interviews with portfolio managers from a variety of firms, and stock picks, click here.
