Top Value Stocks of Investor Michael Price

Some of the most undervalued stocks owned by the value investor.
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Value investor Michael Price sports an outstanding track record as a money manager.

Price got his start with Max Heine at Mutual Series, where he became chairman and president in 1988. Ten years later he sold Heine Securities, the investment advisor to Mutual Series Fund, to Franklin Resources for $670 million. And in 2001, he started his own company, MFP Investors, which has about $1.6 billion under management. He is ranked 664 on

Forbes'

list of the world's billionaires.

Stockpickr has reviewed all of Price's stock holdings and compiled the

Top Stocks of Michael Price

, basing the picks on the stocks' price/earnings-to-growth, or PEG, ratios. The PEG ratio measures the price-to-earnings (P/E) ratio in relation to the company's expected future earnings growth rate. The lower the PEG, the better the value, with a PEG below 2 considered very favorable. Price, who takes a value approach to investing, has several stocks with PEGs below 1.

At the top of the list is

MVC Capital

(MVC) - Get Report

. The investment firm, which has a very low P/E ratio of 4.9, and an excellent PEG of 0.6, recently delivered its latest quarterly dividend of 12 cents a share, which translates to a yield of 3% for investors. On Nov. 1, it filed a Form 8-K with the

Securities and Exchange Commission

disclosing a net asset value of some $15.21 per share.

MVC popped up on the

Barron's Insider Purchases 9-22-2007

portfolio, due to the fact that two officers and four directors purchased $1.4 million worth of stock. Other stocks in that recent

Barron's

Insider portfolio include

Barnes & Noble

(BKS) - Get Report

, which has a PEG of 1.8, and

General Growth Properties

(GGP)

, with a PEG of 1.3.

American International Group

(AIG) - Get Report

is another low-PEG stock held by Price. The world's largest insurance company just reported a 27% reduction in its third-quarter earnings, hurt by problems with the housing market and a tighter credit market. The stock has a P/E of 9.1, a PEG of 0.7 and a yield of 1.4%.

AIG is also in the portfolio of

Renaissance Technologies

, one of the most successful hedge funds. Its $5 billion Medallion Fund has provided an average annual return of 35% after fees since 1989. Renaissance also holds

Johnson & Johnson

(JNJ) - Get Report

, with a PEG of 1.7, and

Colgate-Palmolive

(CL) - Get Report

, with a PEG of 2.1.

ConocoPhillips

(COP) - Get Report

, with a PEG of 0.8, is another undervalued stock owned by Price. The oil company reported a quarterly earnings drop of 5.2% on a 4.3% fall in revenues for its latest quarter. The stock has a P/E of 13 and a yield of 2%.

Michael Price is in good company with ConocoPhillips, as

Warren Buffett

also owns the oil stock. Some of Buffett's other holdings are

Lowe's

(LOW) - Get Report

, with a PEG of 0.8, and

Western Union

(WU) - Get Report

, with a PEG of 1.7.

For the rest of these strong value stocks, check out the

Top Stocks of Michael Price

. And for his entire holdings, see the

Michael Price

portfolio at Stockpickr.com.

Please note that due to factors including low market capitalization and/or insufficient public float, we consider MVC Capital to be a small-cap stock. You should be aware that such stocks are subject to more risk than stocks of larger companies, including greater volatility, lower liquidity and less publicly available information, and that postings such as this one can have an effect on their stock prices.

At the time of publication, Altucher and/or his fund had no positions in stocks mentioned, although positions may change at any time.

James Altucher is president of Stockpickr LLC, a wholly owned subsidiary of TheStreet.com and part of its network of Web properties, and a managing partner at Formula Capital, an alternative asset management firm that runs a fund of hedge funds. He is also a weekly columnist for

The Financial Times

and the author of

Trade Like a Hedge Fund

,

Trade Like Warren Buffett

and

SuperCa$h

. Under no circumstances does the information in this column represent a recommendation to buy or sell stocks. Altucher appreciates your feedback;

click here

to send him an email.

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