Sunday, November 8, 2009, 7:11AM ET - U.S. Markets Closed.

Active Value Investing: The Bull Case for EBAY, Philip Morris and Supervalu

Posted Feb 10, 2009 05:06pm EST by Aaron Task in Investing, Internet

The sayings "it's a stock-picker's market" and "it's a market of stocks, not a stock market" will prove much more than clichés if the stock market is in the middle of a prolonged range-bound period that could last another several years, as Vitaliy Katsenelson, a portfolio manager at Investment Management Associates, contends.

Indeed, the author of Active Value Investing says investors should avoid index funds, which he believes will go sideways at best. But that doesn't mean there aren't opportunities in the stock market.

As detailed in the accompanying video, Katsenelson is long and recommends the following stocks:

  • eBay: Based on a view the company's non-auction business - notably Skype and PayPal - are worth $9 per share and the core auction business is doing as badly as the last quarter indicates.
  • Philip Morris International: Cigarettes are still a growth business overseas and Philip Morris' strong international brand image makes it a good hedge
    against a weak dollar.
  • Supervalu: The company has a lot of debt it needs to refinance, but if Macy's could refi, Supervalu should be able to as well. Plus, groceries are recession resistant and the stock is cheap relative to its main competitors.

33 Comments

you
Yahoo! Finance User - Tuesday February 10, 2009 05:24PM EST

This guy is a clown. It's like talking to a taxi driver for investment advice.

- Tuesday February 10, 2009 05:26PM EST

Yup, if you buy ebay now...what if you bought it 10 months ago?

you
Yahoo! Finance User - Tuesday February 10, 2009 05:29PM EST

Holy cow! The Russian con-man using "cigarettes are currency in prison" as a reason to invest in Philip Morris??? Why is this guy on TechTicker? I like how Aaron and Henry are sitting far from him, close to each other, as though he's got some kind of disease!

you
Yahoo! Finance User - Tuesday February 10, 2009 05:36PM EST

You know, as I set here and I listen to ALL these talking heads, and I mean ALL of them, and the thing that keeps coming to mind is, INSIDER TRADING! If we all had the INSIDE INFO that these INSIDER TRADERS had, we could all do great! But, like most people sitting here with my finger up my azz and hearing the wind howling this way and that way...were not going to go swimming back and forth like a school of mackrel trying not to get caught in another SCAM!!!

you
Yahoo! Finance User - Tuesday February 10, 2009 05:40PM EST

Why is the Government preempting everything. The target is to far off in the future to stop it with random passes. If they want to score a touch down they need to pick a receiver who can catch and run the ball into the end zone. Throwing a lot of money up in the air with the hopes that it takes and cures the economy is not sound play. They need to be right they can't guess at handling this crisis. You will only be right at the right time and place in history.

valueman
valueman - Tuesday February 10, 2009 05:50PM EST

To those who think this guy is a clown, there is a reason he's wealthy and you are not. Show some respect. Have you even read his book? I have, and he is intelligent and dead on right.

you
Yahoo! Finance User - Tuesday February 10, 2009 05:58PM EST

Y'all got to read this: "Implications of Growth in Credit Derivatives for Financial Stability" by Timothy F. Geithner, President and Chief Executive Officer http://www.newyorkfed.org/newsevents/speeches/2006/gei060516.html He concluded "Let me conclude by reiterating the fundamental view that the wave of innovation underway in credit derivatives offers substantial benefits to both the efficiency and stability of our financial system." Now you know why we are in this situation and why Timothy hasn't yet had details on how to reverse engineering what he engineered!

you
Yahoo! Finance User - Tuesday February 10, 2009 05:59PM EST

Mr. V has many good points. Only a cow criticizes his recommendation. See. Winner takes more. Gut wins.

STORMSTOCKER1
STORMSTOCKER1 - Tuesday February 10, 2009 06:02PM EST

the question here is Who? When? With what? Where? Is it time now, or next year?? We have had not ONE positive piece of news in any sector......(except for the governments everywhere....theirs is "spend as usual", no changes ,no cuts, its all about how do we get more tax revenue?'" It would be great to start investing!! but the chips are still down!!.....at least in the private sector!

Barry
Barry - Tuesday February 10, 2009 06:08PM EST

Does anyone other than me notice a remarkable resemblence between Blodget and Geithner??? No, not so much physical, although they're certainly both world class smirkers... I mean a moral, an ethical, and a character resemblence. Do you see it?

__A_YAHOO_USER__
__A_YAHOO_USER__ - Tuesday February 10, 2009 06:09PM EST

You guys just don't see it, do you?...READ LIPS, WE ARE IN A DEPRESSION.

Barry
Barry - Tuesday February 10, 2009 06:17PM EST

Hey Blodget, why don't you take up smoking? Just give me the address of the rock you live under and I'll send you the first carton of Marboros. It's easy! And you'd be a natural for it! It's kinda like fraud. Once you start, it's difficult to stop, especially when you're getting what you crave most: whether it be your nicotine fix, or your obscene bonus fix.

Barry
Barry - Tuesday February 10, 2009 06:18PM EST

For those of you who don’t know (or who have forgotten - which apparently seems to be just about everyone), Henry Blodget is no longer a Wall Street analyst. You see as it turns out, a while back, he was banned from the securities industry for life. In 2003, he was charged with securities fraud and instead of defending the indefensible, decided to pay millions of dollars without admitting or denying the charges. As part of the plea deal, he was banned from the securities industry for life. Mr Blodget is one of the genuine poster boys for the Wall Street crap-fest that lead to the .com bubble. That bubble, of course, led to billions of dollars in investor losses; most suffered by his rank and file investors of course.

frankmargel.com
frankmargel.com - Tuesday February 10, 2009 06:34PM EST

Hey Gang!!! Tuesday sounds like screwsday on the market scene today. I am going to see more volatility and less calm. This is because the markets are selling off bad assets and more junk. It's like the patient that won't get better until the body purges the poison. The government influence is akin to inside trading gone wild. Uncle Sam is an inside trader and apparently it's not illegal for so much influence to go unregulated. Market wise investors are not seeking guidance from Uncle Sam, but some traders are attempting to precipitate short term spreads on the governments intentions/moves. Once the gov gets out of the market and short term traders are left to basic fundamentals, the market will trade closer to fair market value. Eventually the market will crash so hard that the gov will sit on the sideline where it belongs. I invest for the long term, I make simple sound purchases, it's worth the risk because I always go long. I always have and I always will, unless I go short. HAHAHAHAHa .smiles.....Go long or short and invest in America and beyond. Good luck tomorrow and I can't wait for the opening bell. BUY BUY BUY...SELL SELL SELL

you
Yahoo! Finance User - Tuesday February 10, 2009 06:45PM EST

Wow, a guy who's actually done some original research and analysis, and makes some intelligent comments. But because he has a funny "furruner" accent the msg board critics opine that he is a "clown" and a "con man". Feeling hostile anyone?

you
Yahoo! Finance User - Tuesday February 10, 2009 09:08PM EST

good pick

Barry
Barry - Tuesday February 10, 2009 10:06PM EST

Hey Henry, you didn't know that cigarettes were currency in prison? Oh, that's right. I remember now. You decided to decided to pay millions of dollars without admitting or denying the charges. The rich man's justice; the plea deal. It was a wise choice for you. I don't imagine a snot like you would've faired very well in there.

Barry
Barry - Tuesday February 10, 2009 10:13PM EST

Hey Henry, you didn't know that cigarettes were currency in prison? Oh, that's right. I remember now. You decided to decided to pay millions of dollars without admitting or denying the charges. The rich man's justice; the plea deal. It was a wise choice for you. I don't imagine a snot like you would've faired very well in there.

__A_YAHOO_USER__
__A_YAHOO_USER__ - Wednesday February 11, 2009 12:39AM EST

As the crisis deepens, we see more and more foreigners pitching investment advice. If a foreigner pitches bad avdice for the purpose of commiting fraud, and gets caught, that foreigner just leaves the country with your money and never gets punished. I will not take financial advice from anyone who comes from an economicly weak foreign country. That means the only foreigner I would listen too would maybe be a Canadian. An indicator that the crisis is over is this: we see Americans pitching bullish financial advice.

you
Yahoo! Finance User - Wednesday February 11, 2009 12:58AM EST

This is guy is a farce... I also don't understand why he is in Tech Ticker... I guess he is one of the exceptions

Yahoo! reserves the right to refuse, or remove any comment that does not comply with the Yahoo! Terms of Service. The submission of spam, hateful, or obscene messages may result in the termination of your Yahoo! ID.
About Tech Ticker - Send FeedbackDisclaimer. Copyright © 2007 Yahoo! Inc. All rights reserved.
Copyright/IP Policy - Terms of Service - Privacy Policy - Help
Quotes delayed, except where indicated otherwise. Delay times are 15 mins for NASDAQ, NYSE and Amex. See also delay times for other exchanges.

Quotes and other information supplied by independent providers identified on the Yahoo! Finance partner page. Quotes are updated automatically, but will be turned off after 25 minutes of inactivity. Quotes are delayed at least 15 minutes for NASDAQ, NYSE and Amex. See also delay times for other exchanges. Real-Time continuous streaming quotes are available through our premium service. You may turn streaming quotes on or off. Fundamental company data provided by Capital IQ. Financials data provided by Edgar Online. Historical chart data and daily updates provided by Commodity Systems, Inc. (CSI). International historical chart data, daily updates, fund summary, fund performance, dividend data and Morningstar Index data provided by Morningstar, Inc. Analyst estimates data provided by Thomson Financial Network. All data provided by Thomson Financial Network is based solely upon research information provided by third party analysts. Yahoo! has not reviewed, and in no way endorses the validity of such data. Yahoo! and ThomsonFN shall not be liable for any actions taken in reliance thereon. All information provided "as is" for informational purposes only, not intended for trading purposes or advice. Neither Yahoo! nor any of independent providers is liable for any informational errors, incompleteness, or delays, or for any actions taken in reliance on information contained herein. By accessing the Yahoo! site, you agree not to redistribute the information found therein.