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Cobas Asset Management Comments on Babcock

- By Holly LaFon

Babcock (NYSE:BW). The Brexit and the inappropriate comparisons made by the market with a company as unique as Babcock, which is no. 1 or no. 2 in practically all the busi-nesses and regions in which it operates, give us an extraordinary opportunity to purchase good businesses with unique well-managed assets at very attractive prices (PER 8x; an expected annual profitability of 11%).

Babcock is particularly strong in the maintenance of nuclear submarines and frigates in the United Kingdom, in emergency helicopter services in Western Europe, and in the support and dismantling of nuclear power stations, all of which are good businesses which are difficult to replicate.

From Francisco Garcia Parames' Cobas Asset Management third-quarter 2018 shareholder letter.

This article first appeared on GuruFocus.