YLO.TO, LUN.to under priced...
Globe says Lundin, others trading below book value
2011-08-12 07:27 ET - In the News
See In the News (C-LUN) Lundin Mining Corp
The Globe and Mail attempts to identify bargains for value investors in the current market downturn in its Friday, Aug. 12, edition. The Globe's Scott Adams writes in the Number Cruncher column that he looked for stocks in the S&P/TSX composite that are trading below a price-to-book value of one. Then he sorted stocks by price decline over the past month. Stocks trading below a price-to-book value of one are a favourite of value investors as it can sometimes mean they are paying less than a dollar for a dollar's worth of assets, notes Mr. Adams. Some due diligence is still required. Book value per share is calculated by taking a company's assets minus liabilities and dividing by the shares outstanding. Next you divide the stock price by the book value per share. Mr. Adams says he found 32 companies trading below book value of one in the S&P/TSX composite index. Many of them have been hammered hard. The average decline for the group over the last month is 16 per cent. Some of the companies on his list are Yellow Media, Lake Shore Gold, Lundin Mining, Manulife Financial, Advantage Oil & Gas and Thompson Creek Metals. The lowest price to book value in the group is Yellow Media.
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