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Value Managers Find Europe Attractive

Longleaf's LLPFX Mason Hawkins, FPA Crescent's FPACX Steve Romick, and Leuthold's Doug Ramsey LCRIX all see value in slices of the equity world today, and they shared their insights at the 2012 Morningstar Investment Conference.

Jeremy Glaser 20 July, 2012 | 0:00


Longleaf's LLPFX Mason Hawkins, FPA Crescent's FPACX Steve Romick, and Leuthold's Doug Ramsey LCRIX all see value in slices of the equity world today, and they shared their insights at the 2012 Morningstar Investment Conference.

Europe Looks Cheap

Unsurprisingly, Europe was a hot topic of conversation. Ramsey sees incredible value in the European equity market at the moment. By his calculation, the price/normalized earnings ratio for the MSCI Europe index is now under 10 times. This is approaching 2009 and 1982 levels and is well below historic norms. Europe also looks very cheap compared with the S&P 500, which is trading at around 19 times to normalized earnings. Ramsey thinks that even if the European situation gets much worse, investors will still end up on top. Hawkins agreed that P/E ratios in Europe seem very low, particularly when you consider how low interest rates are today.

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About Author

Jeremy Glaser  Jeremy Glaser is the Markets Editor for Morningstar.com.

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