Jump to content

Most Undervalued Asset Class/Sector


Recommended Posts

Wanted to get ideas from the crowd on what you think the most undervalued assett class/sector is today and examples. Some primer or thoughts I had include healthcare, agriculture, volatility, productive low CAPE indexed countries (e.g. Russia).

 

-Concrete examples:

 

Agriculture (Out of favor)

CORN

LAND

FPI

 

Russia (sold on fear)

SBRCY

Link to comment
Share on other sites

Canadian energy and service stocks (exclude majors such as Suncor).

 

Cardboard

 

I think so too, but there hasn't been much profit in it yet.  In my opinion, the risk/reward for some names has gotten much better as the oil storage situation has improved, the spot pricing of oil has improved, the potential for better pipelines (Line 3 and Transmountain) has improved, and stock prices have remained stagnant.  At $30-$40 WTI, you had to be willing to anticipate improved oil prices.  At today's approximately $75 WTI, you are only betting on sustained pricing (or course, there will be substantial swings).

Link to comment
Share on other sites

Yeah, it's some good stuff to start with, but lots of pitfalls.

 

SBRCY is interesting - seems to be a great company and dirt cheap.  However institutions seem to use it almost as a quasi-tracker i.e. if they have one stock in the country, it's that one, so the price can plunge if they all go off Russia.  Of course, that also provides opportunity.

Link to comment
Share on other sites

Hey all:

 

Undervalued stuff & "value" is what I am looking for....

 

Oil & Gas certainly has some candidates in it.

 

Up until recently, retail was a INCREDIBLY ripe area...bargains galore as "Amazon will sell everything, don't you know?"

 

REITS up until recently were offering some great bargains.

 

BDC's were offering some compelling opportunities.

 

HOWEVER, I might think that the auto manufacturing sector is perhaps the most undervalued.  Notice, I'm not talking about TSLA.  I am talking about companies that are selling for 4 P/E's.  Of course, in the next year or so, every car will be electric and everybody will be ferried about in a driver less vehicle...so it is amazing that these stocks are selling for even a 4 (or less) P/E.

 

Then you've got the economy...if it goes down, surely the auto companies will be rushing to the courthouse to file the bankruptcy papers...

 

Who knows though? 

Link to comment
Share on other sites

Two points, it's not easy to tell if a class is undervalued or correctly valued. Also, it isn't most undervalued class but most undervalued in relation to risk. I'll take a slightly less undervalued class that I felt was less risky than one that was a speculative bet. Again the thing I find is you can very easily be wrong on your assessment. The key is to work on the skills and insights that make you a better appraiser.

 

I think in a year like this arbitrage is undervalued. Also possibly cable stocks though I'm not totally sure, I don't think losses are large at today's prices.

I also think some advanced material stocks are good deals , both industrial and biotech. In this case I don't always think in terms of current earnings.

 

 

 

 

 

 

 

 

Link to comment
Share on other sites

Canadian energy and service stocks (exclude majors such as Suncor).

 

Cardboard

 

I think so too, but there hasn't been much profit in it yet.  In my opinion, the risk/reward for some names has gotten much better as the oil storage situation has improved, the spot pricing of oil has improved, the potential for better pipelines (Line 3 and Transmountain) has improved, and stock prices have remained stagnant.  At $30-$40 WTI, you had to be willing to anticipate improved oil prices.  At today's approximately $75 WTI, you are only betting on sustained pricing (or course, there will be substantial swings).

 

Can you give some stock examples? I have some Peyto, but that's gas, and I don't know the oily names.

Link to comment
Share on other sites

  • 3 weeks later...

Create an account or sign in to comment

You need to be a member in order to leave a comment

Create an account

Sign up for a new account in our community. It's easy!

Register a new account

Sign in

Already have an account? Sign in here.

Sign In Now
 Share

×
×
  • Create New...