Should I Do It? Good Show by Loews

Loews(LTR Quote) is trying to prove that the conglomerate business model works, meaning that more businesses under one roof produce more revenue and profit.

Loews was founded more than 60 years ago by famed financier Laurence Tisch, with one hotel. Now his son James Tisch is CEO and president of a corporation with myriad companies under its banner and a market capitalization of more than $25 billion.

Not to be confused with the home-improvement retailer Lowe's(LOW Quote), today the New York City-based Loews holds sizable stakes of insurer CNA Financial(CNA Quote), cigarette-maker Carolina Group(CG Quote), Diamond Offshore Drilling(DO Quote) and natural-gas transporter Boardwalk Pipeline Partners(BWP Quote). The company also controls 20 properties through Loews Hotels, in addition to Bulova watches and a shipping company.

Loews closed Tuesday at $47.38 a share, which is within pennies of its all-time high, as the stock is up 14.2% year to date. At current levels, the company trades at just 11.3 times expected full-year earnings of $4.21, which is a 29% discount to the S&P 500. The stock is also trading at a discount to the sum of its parts.

With that in mind, I'm here to answer investors' questions: Should I do it? Does Loews still look attractive after its run-up, or are investors better off looking elsewhere?

Adding up Loews' stakes in publicly traded companies -- 74% of BWP, 38% of CG, 51% of DO and 89% of CNA -- you get a value that's essentially equal to the current share price of the parent holding company. In other words, you're essentially receiving the privately-held Loews businesses, including its hotels, for free.

To watch David Peltier's video take of this column, click here.