With so much uncertainty in the markets, there are plenty of good companies trading at attractive valuations, legendary hedge fund manager Julian Robertson, told CNBC’s “Closing Bell” on Tuesday. He talks about Apple, hedge funds, Mitt Romney, likes Facebook and Mark Zuckerberg, but wouldnt buy the stock. He likes Rolls-Royce and Capital one, as well.
Video and computer transcript below:
ValueWalk's Raul Panganiban with Maurits Pot, Founder and CEO of Dawn Global. Before this he was Partner at Kingsway Capital, a frontier market specialist with over 2 billion AUM. In the interview, we discuss his approach to investing and why investors should look into frontier and emerging markets. Q2 2021 hedge fund letters, conferences and Read More
where did you get that sweater vest? your ford dealer. julian robertson tells me now is the time to be putting money to work in this market. even at 80 years old, he’s telling me these are interesting times for any investor. it’s an interesting time in our economy. i think the economy and some of the thing overseas are really having a big effect on investors. i think that right now a lot of very good investors have become so frightened about what’s beginning on in europe and in asia and with qe-2, qe-3, qe-et cetera, that they’ve kind of lost their way and are not realizing that there’s still an awful lot of marvelous companies available at very reasonable prices. apple is a magnificent company and a great value at these levels. it’s rare that you get a chance at having a great company at a great value. so when you look at this market, for example today when we see a market down 200 points and all this nervousness driving the day, would you be poised to put money into the market, buy into the selloff? i would buy the specific good companies that are available now. i think that this is the perfect time for a hedge fund. because i think we know how to hedge, we can hedge. some of us may have hedged so much that we really aren’t going to do well unless a real tragedy occurs economically in the world. do you still see the kind of liquidity and participation by investors that we have over the last, you know, two decades or so? i mean, it feels like the retail investor has left the party. is it all institutional right now? i think there’s a lot about retail investors having left the party and maybe the retail investor in many ways has turned himself over to a hedge fund manager. i think maybe hedge funds reflect wealthy individuals as much as anything else. do you think there’s a lot of money on the sidelines that is poised to come back in at some point, and what would be the catalyst for that money to come back? a change would be catalytic. i really feel that if american industry felt that the country were being effectively managed, it might get more courage and it might go in and do a lot of investing on its own. do you think the election represents that kind of catalyst? will things loosen up after the election? i know you’ve been a supporter of mitt romney. you think he has a shot to win? i think he has a good shot. i’m thrilled over it. at the very worst, i think the american people know what a fine man mitt romney is and think he’s acquitted himself beautifully during the campaign. i’m very hopeful he’s going to get elected. let’s talk a little about investing today. i know you’ve been a listening-time holder of apple. you said moments ago you still think it represents value. why is that? because of where it’s is that? because of where it is trading versus profitability? apple is probably around 14 to 15 times next year’s earnings. it is very, very reasonable for the kind of growth you can get. facebook another stock or company that you have been looking at in terms of social media. what is the attraction? i think the attraction is the social media side of it. and even eric schmidt of googleal who was a little late to the party is a great believer in the social media. and i think it is live, well and moving ahead. i am kind of an admirer of the young fellow who heads up facebook. so in terms of facebook i know you like the management and you like mark zuckerburg and what he has done. would you buy the stock? i don’t really know enough about the stock to say that. i’ve sort of been lucky on that some of the younger people here that have a private investment group were very early in facebook and got in it many years ago. i’m part of their partnership so it’s been — i don’t know enough about it, the pricing now. as sort of a student of investing and wall street for so many years were you surprised of the debacle with that ipo? company has lost 50% of its value, real sort of botched ipo from the get go. it really was botched up. but in the sense it was symbolic of what hot deals had been for years. you know, there was people buying it. it is kind of a greed game. in a sense everybody gets what they deserve. tell me about your portfolio and how you are allocating capital today in an overall strategy. i’m looking around for great companies. and i have actually invested in a european air carrier. and i’m very high on Ryanair. Ryanair is a low cost producer in the world. it is selling at a very reasonable multiple. rolls-royce many people think of as a luxury car manufacturer. it is a great supplier to the aero nautics and space around the world. One financial just bought a large mortgage company from wilber Ross. those companies have a lot i think going for them. capital one is a fine company. i think the steels are way over valued. ak steel and u.s. steel and japanese steels are just ridiculously priced for anything except a real takeoff economy. and i don’t think anybody expects the economy to explode on the upside. my thanks to julan robinson.