As 2012 nears its end and many investors take time to reevaluate their portfolios, you may consider this list of the top Guru Bargains – the stocks that have dropped the most since Gurus bought them – as a jumping-off point for research. The list is taken from GuruFocus’ Guru Bargains screener, which reports the stocks whose prices have declined more than 20% since Gurus bought them.
5. ITT Educational Services (ESI, Financial)
Jeremy Grantham bought 12,000 ITT Educational Services shares for $45.50 per share in the third quarter, and it has since dropped 59.9%, making it the stock with the fifth largest discount since a Guru bought it. Grantham’s trading history with ITT predates the second quarter of 2007, and ended in the second quarter of 2012 when he closed out the position at $60, until he opened the new position at the lower price. ITT shares are $17 each in Monday trading.
ITT is a for-profit, technology-oriented undergraduate and graduate education company, owning more than 140 ITT Technical Institutes and Daniel Webster Colleges. Approximately 60,000 students attend its campuses in 39 states.
In the past 12 months, ITT’s revenue increased by 1.7 percent and book value by 17.3 percent. EBITDA declined by 18.1 percent and free cash flow by 76.5 percent.
ESI has a P/E of 1.9, P/B of 4.9 and P/S of 0.3 (near a three-year low). It does not pay a dividend.
4. Centrais Electricas Brasileiras (Electrobras) SA (EBR, Financial)
This stock, from Jeremy Grantham’s portfolio, has declined 54 percent since Jeremy Grantham bought it in the third quarter. He owns 2,335,420 shares of the stock which he has been trading since the fourth quarter of 2009. The stock’s price in Monday trading is $3 a share.
Based in Brazil, Electrobras is the largest company in the electric power sector in Latin America, with six subsidiaries, six distribution companies, a research center, eletrobras eletropar, and 50 percent of Itaipu Binacional. The Brazilian federal government owns a majority of the company’s shares.
In the last 12 months, Electrobras’ revenue per share increased 8.6 percent and EBITDA increased 38.8 percent. Free cash flow tumbled 170.2 percent and book value declined 10.8 percent.
Electrobras has a P/E of 1.2, P/B of 0.1 and P/S of 0.3. It does not pay a dividend.
3. Active Network Inc. (ACTV, Financial)
Active Network’s price has dropped 61% since PRIMECAP Management bought it. PRIMECAP’s holding history with the stock is brief: It bought 100,300 shares in the second quarter of 2012 for $15 a share on average, and enlarged the stake by 635,300 shares in the second quarter of 2012 when the price slid further to $13 per share on average. It sells for $4.68 a share in Monday trading.
Active is an event-management and community-building company that has 50,000 clients globally and is involved in over 80 million transactions a year. The company went public in mid-2011 and its price has plunged 75% since then.
In its third quarter financial results, reported Nov. 2, 2012, Active divulged a 22% year-over-year revenue increase, and a net loss of $6 million, steeper than a net loss of $1.4 million a year previously. The company’s balance sheet was also less fortified with cash, at $78.5 million, falling from $108.7 million a year previously.
With no earnings, Active Network has no P/E, a P/B of 0.8 and P/S of 0.9. It also pays no dividend.
2. Inteliquent (IQNT, Financial)
Since Jim Simons bought this stock in the third quarter, its price depleted 77 percent. He began trading the stock in the fourth quarter of 2009 around a price of $22 per share and has been trading it ever since. His total holding now stands at 339,503 shares. In Monday trading, Inteliquent costs $2.67 a share.
Inteliquent is a global voice and data corporation that provides voice, IP Transit and Ethernet solutions in more than 80 countries, and is the largest global Ethernet interconnection provider.
In the past 12 months, Inteliquent grew its revenue per share by 20.6 percent, EBITDA by 1.3 percent, free cash flow by 6.4 percent and book value by 17.4 percent.
Inteliquent does not pay a regular dividend but on Oct. 5, 2012, it decided on a special $3.00 cash dividend, costing the company about $96.7 million, which it paid to shareholders on Oct. 30, 2012.
The P/E ratio for Inteliquent is 6.1, the P/B is 0.3 (close to a three-year low) and the P/S is 0.3.
1. Sycamore Networks (SCMR, Financial)
The biggest Guru bargain available today is another Jim Simons pick: Sycamore Networks. The company watched it stock lose 85% since Simons bought for $15 a share in the third quarter. In Monday trading, it is priced at $2.29 a share. Simons has been trading the stock since before the second quarter of 2007.
Sycamore Networks provides bandwidth management solutions for fixed line and mobile network operators around the world, with clients among Tier 1 service providers, government agencies and utilities companies.
Sycamore, in the past 12 months, grew revenue per share by 16.4 percent. EBITDA fell by 30.4 percent, free cash flow fell 69.9 percent and book value fell 11.4.
Without earnings, Sycamore has no P/E. Its P/B is 0.2 and P/S is 1.1 (close to a two-year low).
It pays no regular dividend, but on Nov. 7 decided to distribute $0.50 per share of common stock to shareholders, which it paid on Dec. 20.
Find more stocks discounted since Gurus bought them in GuruFocus’ Guru Bargains screener, and separate stocks by company, Guru, buy/sell, position size or discount size.
5. ITT Educational Services (ESI, Financial)
Jeremy Grantham bought 12,000 ITT Educational Services shares for $45.50 per share in the third quarter, and it has since dropped 59.9%, making it the stock with the fifth largest discount since a Guru bought it. Grantham’s trading history with ITT predates the second quarter of 2007, and ended in the second quarter of 2012 when he closed out the position at $60, until he opened the new position at the lower price. ITT shares are $17 each in Monday trading.
ITT is a for-profit, technology-oriented undergraduate and graduate education company, owning more than 140 ITT Technical Institutes and Daniel Webster Colleges. Approximately 60,000 students attend its campuses in 39 states.
In the past 12 months, ITT’s revenue increased by 1.7 percent and book value by 17.3 percent. EBITDA declined by 18.1 percent and free cash flow by 76.5 percent.
ESI has a P/E of 1.9, P/B of 4.9 and P/S of 0.3 (near a three-year low). It does not pay a dividend.
4. Centrais Electricas Brasileiras (Electrobras) SA (EBR, Financial)
This stock, from Jeremy Grantham’s portfolio, has declined 54 percent since Jeremy Grantham bought it in the third quarter. He owns 2,335,420 shares of the stock which he has been trading since the fourth quarter of 2009. The stock’s price in Monday trading is $3 a share.
Based in Brazil, Electrobras is the largest company in the electric power sector in Latin America, with six subsidiaries, six distribution companies, a research center, eletrobras eletropar, and 50 percent of Itaipu Binacional. The Brazilian federal government owns a majority of the company’s shares.
In the last 12 months, Electrobras’ revenue per share increased 8.6 percent and EBITDA increased 38.8 percent. Free cash flow tumbled 170.2 percent and book value declined 10.8 percent.
Electrobras has a P/E of 1.2, P/B of 0.1 and P/S of 0.3. It does not pay a dividend.
3. Active Network Inc. (ACTV, Financial)
Active Network’s price has dropped 61% since PRIMECAP Management bought it. PRIMECAP’s holding history with the stock is brief: It bought 100,300 shares in the second quarter of 2012 for $15 a share on average, and enlarged the stake by 635,300 shares in the second quarter of 2012 when the price slid further to $13 per share on average. It sells for $4.68 a share in Monday trading.
Active is an event-management and community-building company that has 50,000 clients globally and is involved in over 80 million transactions a year. The company went public in mid-2011 and its price has plunged 75% since then.
In its third quarter financial results, reported Nov. 2, 2012, Active divulged a 22% year-over-year revenue increase, and a net loss of $6 million, steeper than a net loss of $1.4 million a year previously. The company’s balance sheet was also less fortified with cash, at $78.5 million, falling from $108.7 million a year previously.
With no earnings, Active Network has no P/E, a P/B of 0.8 and P/S of 0.9. It also pays no dividend.
2. Inteliquent (IQNT, Financial)
Since Jim Simons bought this stock in the third quarter, its price depleted 77 percent. He began trading the stock in the fourth quarter of 2009 around a price of $22 per share and has been trading it ever since. His total holding now stands at 339,503 shares. In Monday trading, Inteliquent costs $2.67 a share.
Inteliquent is a global voice and data corporation that provides voice, IP Transit and Ethernet solutions in more than 80 countries, and is the largest global Ethernet interconnection provider.
In the past 12 months, Inteliquent grew its revenue per share by 20.6 percent, EBITDA by 1.3 percent, free cash flow by 6.4 percent and book value by 17.4 percent.
Inteliquent does not pay a regular dividend but on Oct. 5, 2012, it decided on a special $3.00 cash dividend, costing the company about $96.7 million, which it paid to shareholders on Oct. 30, 2012.
The P/E ratio for Inteliquent is 6.1, the P/B is 0.3 (close to a three-year low) and the P/S is 0.3.
1. Sycamore Networks (SCMR, Financial)
The biggest Guru bargain available today is another Jim Simons pick: Sycamore Networks. The company watched it stock lose 85% since Simons bought for $15 a share in the third quarter. In Monday trading, it is priced at $2.29 a share. Simons has been trading the stock since before the second quarter of 2007.
Sycamore Networks provides bandwidth management solutions for fixed line and mobile network operators around the world, with clients among Tier 1 service providers, government agencies and utilities companies.
Sycamore, in the past 12 months, grew revenue per share by 16.4 percent. EBITDA fell by 30.4 percent, free cash flow fell 69.9 percent and book value fell 11.4.
Without earnings, Sycamore has no P/E. Its P/B is 0.2 and P/S is 1.1 (close to a two-year low).
It pays no regular dividend, but on Nov. 7 decided to distribute $0.50 per share of common stock to shareholders, which it paid on Dec. 20.
Find more stocks discounted since Gurus bought them in GuruFocus’ Guru Bargains screener, and separate stocks by company, Guru, buy/sell, position size or discount size.
