Last night I was at the Towson University International Markets Summit.  I’m grateful to the students for inviting me, as it is an honor.  During the presentation, I mentioned the book “Accounting for Value” by Stephen Penman. I reviewed the book two years ago.  A great book, and one that should lead readers to modify their views on value investing.

But one aspect of the book was easy to implement, he cited his paper that you can read here, Returns to Buying Earnings and Book Value: Accounting for Growth and Risk.  Buy the stocks that are the cheapest as measured by the highest quintiles of book value to price, and trailing twelve month earnings per share to price.

I ran this analysis for all US-traded stocks with over $100 million of market capitalization.  Here are the results:

Petrobras Argentina SA ADRPZE0606 – Oil & Gas – IntegratedArgentina1.267.95
Pampa Energia S.A. (ADR)PAM1203 – Electric UtilitiesArgentina0.8311.41
OMV AG (ADR)OMVKY0609 – Oil & Gas OperationsAustria1.1311.33
Validus Holdings, Ltd.VR0709 – Insurance (Life)Bermuda113.3
Everest Re Group LtdRE0715 – Insurance (Property & Casualty)Bermuda0.8815.35
Maiden Holdings, Ltd.MHLD0715 – Insurance (Property & Casualty)Bermuda0.9310.11
Montpelier Re Holdings Ltd.MRH0715 – Insurance (Property & Casualty)Bermuda0.9911.83
Axis Capital Holdings LimitedAXS0715 – Insurance (Property & Casualty)Bermuda1.0113.2
Platinum Underwriters HoldingsPTP0715 – Insurance (Property & Casualty)Bermuda1.0211.25
White Mountains Insurance GrouWTM0715 – Insurance (Property & Casualty)Bermuda1.078.49
Aspen Insurance Holdings LimitAHL0715 – Insurance (Property & Casualty)Bermuda1.129.61
Assured Guaranty Ltd.AGO0715 – Insurance (Property & Casualty)Bermuda1.1818.59
Partnerre LtdPRE0715 – Insurance (Property & Casualty)Bermuda1.2310.75
Argo Group International HoldiAGII0715 – Insurance (Property & Casualty)Bermuda1.2711.55
Endurance Specialty Holdings LENH0715 – Insurance (Property & Casualty)Bermuda1.3112.55
Gerdau SA (ADR)GGB0121 – Iron & SteelBrazil1.326.84
Gafisa SA (ADR)GFA0215 – Construction ServicesBrazil2.0415.52
Petroleo Brasileiro PetrobrasPBR0606 – Oil & Gas – IntegratedBrazil1.6713.2
Telefonica Brasil SA (ADR)VIV0915 – Communications ServicesBrazil0.857.58
Companhia de Saneamento BasicoSBS1209 – Water UtilitiesBrazil0.898.57
Endeavour Silver CorpEXK0118 – Gold & SilverCanada0.899.9
Teck Resources Ltd (USA)TCK0124 – Metal MiningCanada1.336.84
TransGlobe Energy CorporationTGA0609 – Oil & Gas OperationsCanada0.8510.03
Granite Real Estate InvestmentGRP.U0933 – Real Estate OperationsCanada0.877.53
Brookfield Office Properties IBPO0933 – Real Estate OperationsCanada1.0810.08
Boardwalk REIT (USA)BOWFF0933 – Real Estate OperationsCanada1.1411.54
Greenlight Capital Re, Ltd.GLRE0715 – Insurance (Property & Casualty)Cayman Islands0.919.45
Sinopec Shanghai PetrochemicalSHI0103 – Chemical ManufacturingChina1.5211
Yongye International, IncYONG0103 – Chemical ManufacturingChina1.6543.36
China XD Plastics Co LtdCXDC0109 – Containters & PackagingChina1.1322.71
Lihua International IncLIWA0127 – Misc. Fabricated ProductsChina2.3141.21
Xinyuan Real Estate Co., Ltd.XIN0215 – Construction ServicesChina5.2242.83
China Automotive Systems, Inc.CAAS0415 – Auto & Truck PartsChina0.9911.04
China Petroleum & Chemical CorSNP0609 – Oil & Gas OperationsChina0.8710.11
Concord Medical Services HldgCCM0806 – Healthcare FacilitiesChina3.0612.45
China Telecom Corporation LimiCHA0915 – Communications ServicesChina1.177.03
Xueda Education Group (ADR)XUE0969 – SchoolsChina0.846.63
Changyou.Com Ltd (ADR)CYOU1018 – Computer ServicesChina1.2320.92
Nam Tai Electronics, Inc.NTE1024 – Electronic Instruments & ControlsChina1.1121.58
Jinpan International LimitedJST1024 – Electronic Instruments & ControlsChina1.713.36
Semiconductor Manufacturing InSMI1033 – SemiconductorsChina0.968.06
China Eastern Airlines Corp. LCEA1106 – AirlineChina1.0512.11
China Southern Airlines Co LtdZNH1106 – AirlineChina1.713.19
Guangshen Railway Co. Ltd (ADRGSH1112 – RailroadsChina1.346.64
Axa SA (ADR)AXAHY0709 – Insurance (Life)France1.199.46
Volkswagen AG (ADR)VLKAY0412 – Auto & Truck ManufacturersGermany0.949.73
Allianz SE (ADR)AZSEY0715 – Insurance (Property & Casualty)Germany0.9211.08
E.ON SE (ADR)EONGY1203 – Electric UtilitiesGermany1.288.17
National Bank of Greece (ADR)NBG0727 – Regional BanksGreece2131.03
Capital Product Partners L.P.CPLP1118 – Water TransportationGreece0.8310.36
Safe Bulkers, Inc.SB1118 – Water TransportationGreece0.8311.99
StealthGas Inc.GASS1118 – Water TransportationGreece1.329.08
Navios Maritime Holdings Inc.NM1118 – Water TransportationGreece1.3213.4
Sun Hung Kai Properties LimiteSUHJY0215 – Construction ServicesHong Kong1.4415.22
Hysan Development Company LimiHYSNY0215 – Construction ServicesHong Kong1.6620.18
Tai Cheung Holdings Ltd (ADR)TAICY0215 – Construction ServicesHong Kong2.1134.38
Le Gaga Holdings Ltd ADRGAGA0509 – CropsHong Kong1.5514.63
Bank of East Asia Ltd. (ADR),BKEAY0727 – Regional BanksHong Kong0.858.78
Iao Kun Group Holding Co LtdIKGH0912 – Casinos & GamingHong Kong1.3612.89
Cheung Kong (Holdings) LimitedCHEUY0933 – Real Estate OperationsHong Kong1.1611.07
Seaspan CorporationSSW1118 – Water TransportationHong Kong1.0515.2
Magyar Telekom Tavkozlesi NyrtMYTAY0915 – Communications ServicesHungary1.346.66
XL Group plcXL0715 – Insurance (Property & Casualty)Ireland1.1211.72
Fly Leasing Ltd(ADR)FLY0939 – Rental & LeasingIreland1.317.39
Ellomay Capital Ltd.ELLO1033 – SemiconductorsIsrael0.9310.95
FUJIFILM Holdings Corp. (ADR)FUJIY0112 – Fabricated Plastic & RubberJapan1.556.64
Kobe Steel, Ltd. (ADR)KBSTY0121 – Iron & SteelJapan1.4714.7
Mitsui & Co Ltd (ADR)MITSY0218 – Misc. Capital GoodsJapan1.3313.26
Wacoal Holdings Corporation (AWACLY0403 – Apparel/AccessoriesJapan1.457.14
Toyota Motor Corp (ADR)TM0412 – Auto & Truck ManufacturersJapan0.8210.5
Honda Motor Co Ltd (ADR)HMC0412 – Auto & Truck ManufacturersJapan0.927.61
Nissan Motor Co., Ltd. (ADR)NSANY0412 – Auto & Truck ManufacturersJapan1.1110.04
Nomura Holdings, Inc. (ADR)NMR0718 – Investment ServicesJapan1.0910.18
Mizuho Financial Group Inc. (AMFG0727 – Regional BanksJapan1.1314.9
Sumitomo Mitsui Financial Grp,SMFG0727 – Regional BanksJapan1.2816.67
Mitsubishi UFJ Financial GroupMTU0727 – Regional BanksJapan1.5313.67
Nippon Telegraph & Telephone CNTT0915 – Communications ServicesJapan1.398.93
ORIX Corporation (ADR)IX0939 – Rental & LeasingJapan0.987.59
Ternium S.A. (ADR)TX0121 – Iron & SteelLuxembourg0.897.61
ING Groep NV (ADR)ING0709 – Insurance (Life)Netherlands1.149.46
VimpelCom Ltd (ADR)VIP0915 – Communications ServicesNetherlands0.9313.67
ASM International NV (ADR)ASMI1033 – SemiconductorsNetherlands1.0174.95
Petroleum Geo-Services ASA (ADPGSVY0612 – Oil Well Services & EquipmentNorway0.819.85
Banco Latinoamericano Comerc EBLX0727 – Regional BanksPanama0.858.39
Compania de Minas BuenaventuraBVN0118 – Gold & SilverPeru1.1810.05
OFG BancorpOFG0727 – Regional BanksPuerto Rico0.9311.04
Popular IncBPOP0727 – Regional BanksPuerto Rico1.5219.77
Triple-S Management Corp.GTS0806 – Healthcare FacilitiesPuerto Rico1.7912.52
LUKOIL (ADR)LUKOY0606 – Oil & Gas – IntegratedRussian Federation1.9119.08
China Yuchai International LimCYD0218 – Misc. Capital GoodsSingapore1.215.34
Net 1 UEPS Technologies IncUEPS0703 – Consumer Financial ServicesSouth Africa0.916.79
POSCO (ADR)PKX0121 – Iron & SteelSouth Korea1.726.97
Shinhan Financial Group Co., LSHG0727 – Regional BanksSouth Korea1.248.42
Woori Finance Holdings Co., LtWF0727 – Regional BanksSouth Korea1.919.86
SK Telecom Co., Ltd. (ADR)SKM0915 – Communications ServicesSouth Korea0.8911.87
Repsol SA (ADR)REPYY0606 – Oil & Gas – IntegratedSpain1.067.93
Transocean LTDRIG0612 – Oil Well Services & EquipmentSwitzerland1.149.54
ACE LimitedACE0715 – Insurance (Property & Casualty)Switzerland0.8410.92
Allied World Assurance Co HoldAWH0715 – Insurance (Property & Casualty)Switzerland111.73
United Microelectronics Corp (UMC1033 – SemiconductorsTaiwan1.38.02
Silicon Motion Technology CorpSIMO1033 – SemiconductorsTaiwan1.9619.74
BP plc (ADR)BP0606 – Oil & Gas – IntegratedUnited Kingdom0.8515.1
Noble Corporation PLCNE0612 – Oil Well Services & EquipmentUnited Kingdom1.0810.05
Subsea 7 SA (ADR)SUBCY0612 – Oil Well Services & EquipmentUnited Kingdom1.097.02
ENSCO PLCESV0612 – Oil Well Services & EquipmentUnited Kingdom1.1112.2
Rowan Companies PLCRDC0612 – Oil Well Services & EquipmentUnited Kingdom1.36.71
HSBC Holdings plc (ADR)HSBC0727 – Regional BanksUnited Kingdom0.948.09
Vodafone Group Plc (ADR)VOD0915 – Communications ServicesUnited Kingdom1.4731.68
J Sainsbury plc (ADR)JSAIY0957 – Retail (Grocery)United Kingdom0.9610.57
Global Ship Lease, Inc.GSL1118 – Water TransportationUnited Kingdom2.1116.62
Cliffs Natural Resources IncCLF0124 – Metal MiningUnited States1.8712.76
M.D.C. Holdings, Inc.MDC0215 – Construction ServicesUnited States0.9123.28
M/I Homes IncMHO0215 – Construction ServicesUnited States0.9227.21
URS CorpURS0215 – Construction ServicesUnited States1.167.02
Mestek, Inc.MCCK0218 – Misc. Capital GoodsUnited States0.9811.53
General Motors CompanyGM0412 – Auto & Truck ManufacturersUnited States0.837.98
Rocky Brands IncRCKY0418 – FootwearUnited States1.216.82
Johnson Outdoors Inc.JOUT0430 – Recreational ProductsUnited States0.877.83
LeapFrog Enterprises, Inc.LF0430 – Recreational ProductsUnited States0.8917.58
Yasheng GroupHERB0509 – CropsUnited States11.7770.4
Seaboard CorporationSEB0515 – Food ProcessingUnited States0.826.77
John B. Sanfilippo & Son, Inc.JBSS0515 – Food ProcessingUnited States0.848.55
Omega Protein CorporationOME0515 – Food ProcessingUnited States1.0112.24
Ennis, Inc.EBF0518 – Office SuppliesUnited States0.928.43
ACCO Brands CorporationACCO0518 – Office SuppliesUnited States1.0111.07
Universal CorpUVV0524 – TobaccoUnited States0.9310.8
Hess Corp.HES0609 – Oil & Gas OperationsUnited States0.8612.86
Approach Resources Inc.AREX0609 – Oil & Gas OperationsUnited States0.939.48
Equal Energy Ltd. (USA)EQU0609 – Oil & Gas OperationsUnited States0.969.38
Sandridge Mississippian TrustSDT0609 – Oil & Gas OperationsUnited States1.4963.59
PHI Inc.PHII0612 – Oil Well Services & EquipmentUnited States0.858.96
Medallion Financial CorpTAXI0703 – Consumer Financial ServicesUnited States0.949.13
CIT Group Inc.CIT0703 – Consumer Financial ServicesUnited States0.967.26
Goldman Sachs Group IncGS0703 – Consumer Financial ServicesUnited States0.9710.16
Ellington Financial LLCEFC0703 – Consumer Financial ServicesUnited States1.0413.7
Walter Investment Management CWAC0703 – Consumer Financial ServicesUnited States1.1123.94
Chimera Investment CorporationCIM0703 – Consumer Financial ServicesUnited States1.1211.58
PHH CorporationPHH0703 – Consumer Financial ServicesUnited States1.199.68
EZCORP IncEZPW0703 – Consumer Financial ServicesUnited States1.587.55
WellPoint IncWLP0706 – Insurance (Accident & Health)United States0.899.52
Employers Holdings, Inc.EIG0706 – Insurance (Accident & Health)United States0.9310.46
Reinsurance Group of America IRGA0706 – Insurance (Accident & Health)United States1.087.49
American Equity Investment LifAEL0709 – Insurance (Life)United States0.8616.77
Protective Life Corp.PL0709 – Insurance (Life)United States0.929.76
FBL Financial GroupFFG0709 – Insurance (Life)United States0.969.73
Unum GroupUNM0709 – Insurance (Life)United States0.989.55
Assurant, Inc.AIZ0709 – Insurance (Life)United States19.67
Lincoln National CorporationLNC0709 – Insurance (Life)United States1.079.76
Symetra Financial CorporationSYA0709 – Insurance (Life)United States1.238.64
CNO Financial Group IncCNO0709 – Insurance (Life)United States1.2912.39
Imperial Holdings, Inc.IFT0709 – Insurance (Life)United States1.3837.03
National Western Life InsurancNWLI0709 – Insurance (Life)United States1.6310.85
Genworth Financial IncGNW0709 – Insurance (Life)United States1.726.87
Fortegra Financial CorpFRF0712 – Insurance (Miscellaneous)United States1.288.18
Allstate Corporation, TheALL0715 – Insurance (Property & Casualty)United States0.828.75
HCC Insurance Holdings, Inc.HCC0715 – Insurance (Property & Casualty)United States0.828.92
State Auto Financial CorpSTFC0715 – Insurance (Property & Casualty)United States0.836.92

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