Prem Watsa might not be as famous as his American counterpart – renowned value investor Warren Buffett. But this Canadian is doing some pretty interesting things, turning his attention to what some would consider odd investments.
For one there's Greece, which is probably not a country that immediately leaps to mind when mulling over positive economic indicators. The jobless rate there puts our own unemployment woes in perspective (27.6% overall and 65% for Greece's youth). The country also posted its 20th consecutive quarterly decline in June, and GDP is down 4.6%. Couple that with a increasingly sinister far-right movement that makes the American Tea Party look like a pack of Berkley co-eds – and you don't exactly have a recipe for a sound investing environment.
And yet Watsa thinks now is the time to get in. "The economy has come down very significantly, unemployment is high. But on the other hand, we think that perhaps a bottom has been reached" he said in a June 19 interview with Bloomberg. His firm Fairfax Financial Holdings (FFRHF) is investing $217 million in a Greek property company, Eurobank Properties Real Estate Investment Company.
As if betting on Greece weren't enough to indicate a predilection for underdogs, it follows a successful investment in the Bank of Ireland during the depths of country's mortgage crisis. Watsa enjoys saving struggling companies as well, as he recently emerged as the most likely bidder for the beleaguered smartphone manufacturer BlackBerry (BBRY), increasing his stake by 10% to a point where it is now the largest holding in his portfolio.
This is the typical method of value investors – to seek out bargains, or companies that have been written off by other analyists. For instance, now would hardly seem like the best time to start acquiring newspapers (Watsa also owns a stake in The New York Times Company (NYT). Many of these investments seem downright noble – the Greek housing market is desperate for capital, as housing prices there fell more than anywhere else in the world, but are such moves wise?
Click on the interactive chart to view yearly sales over time.
Do you see investment opportunities in this sampling of Prem Watsa's holdings? Use the list below as a starting point for your own analysis:
2. Resolute Forest Products Inc. (RFP, Earnings, Analysts, Financials): Manufactures and sells newsprint, commercial printing papers, market pulp, and wood products. Market cap at $1.27B, most recent closing price at $13.37.
3. Dex Media, Inc. (DXM, Earnings, Analysts, Financials): Provides local, social, and mobile marketing solutions to businesses in communities across the United States under the Dex One and SuperMedia brands. Market cap at $169.12M, most recent closing price at $9.89.
4. Cooper Tire & Rubber Co. (CTB, Earnings, Analysts, Financials): Manufactures and markets replacement tires in North America and internationally. Market cap at $2.06B, most recent closing price at $32.55.
5. International Business Machines Corp. (IBM, Earnings, Analysts, Financials): Provides information technology (IT) products and services worldwide. Market cap at $206.45B, most recent closing price at $187.53.
6. Merck & Co. Inc. (MRK, Earnings, Analysts, Financials): Provides various health solutions through its prescription medicines, vaccines, biologic therapies, animal health, and consumer care products. Market cap at $146.2B, most recent closing price at $48.57.
(List compiled by James Dennin. Sales data sourced from Zacks Investment Research, all other data sourced from Finviz.)
Analyze These Ideas: Getting Started
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Dig Deeper: Access Company Snapshots, Charts, Filings
- Research In Motion Limited(BBRY, Chart, Download SEC Filings)
- Resolute Forest Products Inc.(RFP, Chart, Download SEC Filings)
- Dex Media, Inc.(DXM, Chart, Download SEC Filings)
- Cooper Tire & Rubber Co.(CTB, Chart, Download SEC Filings)
- International Business Machines Corp.(IBM, Chart, Download SEC Filings)
- Merck & Co. Inc.(MRK, Chart, Download SEC Filings)
- The New York Times Company(NYT, Chart, Download SEC Filings)
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