Billionaire Stanley Druckenmiller’s Cheap Stock Picks

Page 1 of 2

Price-to-earnings multiples are crude metrics, but are still at the core of many value investing approached because they concisely put a company’s market valuation in the context of its current performance. In particular, we think they are useful for narrowing down a cluster of stocks into a more reasonable number. Investors can then briefly analyze these companies and then move them on to the next stage of their investment process if they pass muster. Here are five stocks which billionaire Stanley Druckenmiller reported owning in his most recent 13F filing which have both trailing and forward P/E multiples of 13 or lower (or research more stocks Druckenmiller liked):

Druckenmiller’s top pick was Exxon Mobil Corporation (NYSE:XOM), initiating a position of 1.3 million shares. Exxon Mobil made our list of the most popular energy stocks among hedge funds in the third quarter of the year (see the rest of the top ten list). Its 2013 earnings multiple of 11 represents a premium to many oil majors, though it is something of a market leader for the industry and while it did report declines in revenue and earnings in its most recent quarterly report these decreases tended to be steeper at its peers. We think that the company could make for a good long term stock pick.

DUQUESNE CAPITALDruckenmiller also initiated a position in another cheap oil major, Chevron Corporation (NYSE:CVX). Chevron carries trailing and 2013 P/Es of 10 and 9, respectively; it is one of the other oil companies priced slightly lower than Exxon Mobil. It also has turned in a poorer financial performance recently; sales were down 10% in Q3 2012 versus a year earlier and net income fell 33%. As a result investors who are interested in big oil have a choice as to whether they want to pay a premium for a somewhat better company. Billionaire Ken Fisher’s Fisher Asset Management increased its holdings of Chevron during the third quarter of 2012 and closed September with 3.6 million shares in its portfolio (check out Fisher’s stock picks).

Two banks and an energy services company completed our list of cheap Druckenmiller picks:

Page 1 of 2
Comments
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months. Our beta is only 1.2 (don't click this link if beating the market isn't important to you).

Lists

The 9 Most Dangerous Countries for Tourists to Visit

Reign of Terror: The 10 Most Ruthless Politicians in History

On the Move: The 10 Fastest Growing Businesses in 2015

Fast Money: The 10 Highest Paying Fast Food Restaurants

Mixing It Up: The 14 Best Music Mashups of 2014

Rito Pls Buff: The 10 Least Played Champions in LoL Season 4

10 Covers of Popular Songs that are Better than the Originals

Must See TV: The 9 Most Anticipated Shows of 2015

The 15 Biggest Box Office Bombs of All Time

10 Things The World Can’t Stand About Americans

Picture Perfect: The 6 Smartphones with the Best Cameras

The 10 Best Countries To Work In the World

A Profitable Day At The Track: 5 Tips For Betting On Horses

Tearing You Apart: 6 Bad Habits That Ruin Relationships

Learning on the Job: The 6 Biggest Mistakes Parents Make

Shopaholics Rejoice: The 12 Biggest Malls in the World

Fright Night: 10 Horror Movies Based on True Stories

Mach Mania: The 10 Fastest Jets in the World

Military Heavyweights: The 10 Countries with the Most Tanks

All In: The 7 Richest Poker Players in the World

Abracadabra: The 10 Best Magicians in the World

The 10 Richest Asian Countries in the World in 2014

Eyes in the Sky: 10 Things You Need to Know About Drones

Rising Stars: The 6 Best Silicon Valley Startups

Military Muscle: The 5 Most Advanced Armies in South America

All that Glitters: The 7 Most Luxurious Jewelry Brands in the World

5 Things You Didn’t Know About ISIS but Should

Empowering Your Money: The 5 Best Energy Stocks to Invest In

The 11 Best Android Apps You Can’t Get on iOS

The 10 Most Important International Conflicts in 2014

Mood Enhancers: The 20 Most Uplifting Songs of all Time

Lover Beware: The 8 Countries that Cheat the Most

Breath of Fresh Air: The 25 Countries with the Best Air Quality on the Planet

Singles Beware: The 8 Worst Mistakes Made on First Dates

Healthy and Happy: The 10 Countries with Lowest Healthcare Costs

The 6 Best Company Team Building Activities to Build Workplace Camaraderie

Ships Ahoy: The 10 Busiest Shipping Ports in the World

10 Productivity Tips to Save You Time and Help You Do More With Less

Grab a Bite: The Most Popular Fast Food Restaurants in America

Friday Night Thirst: The 10 Most Popular Cocktails in the World

The 6 Greatest Unsolved Mysteries We May Never Figure Out

7 Useless Products You Never Should’ve Bought

The 5 Reasons Why You’re Single and Miserable

The 7 Most Addictive Foods in the World We Can’t Stop Eating (Even Though We Should)

5 Amazing Places You Can Swim with Dolphins

The Top 7 Most Livable Countries In The World

The 10 Most Expensive Baseball Cards Ever Pulled From A Pack

The 5 Easiest Second Languages to Learn for English Speakers

Silver Spoon: The 6 Richest Families in the World

The 20 Countries with the Largest Prison Populations in the World

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!