(Corrects last paragraph to say that O’Shaughnessy said Bear Stearns had subprime problems that were little different from those at other banks, not that they were “a little different” from problems at other banks)
NEW YORK (Reuters) - Money manager Jim O'Shaughnessy, who oversees about $11 billion in assets, said on Tuesday that the sell-off in U.S. bank stocks may have run its course.
"I think that financials are now looking attractive again," O'Shaughnessy, who uses a value-tilted quantitative strategy, said at the Reuters Investment Outlook Summit in New York.
He said that with the huge write-offs some banks and other financial companies have taken because of losses in mortgage-related securities, it is now near a point where the bad news is out.
Noting that many financial companies have slashed their dividends, O'Shaughnessy said that might not be a bad thing. He pointed out that back in the 1980s Goodyear Tire cut its dividend amid tough times -- and then saw its stock soar 181 percent.
O'Shaughnessy said he has been buying banking stocks in Australia, one of three countries that have the largest allocation outside of the United States in his global strategy.
The United States gets a 30 percent allocation in the global strategy. Apart from Australia, the other top overseas allocations are to Japan and Germany.
O'Shaughnessy's methodology involves evaluating stocks on the basis of price to sales or price to cash flow.
While he thinks banks are starting to look attractive, O'Shaughnessy had a dim view of home builders. Continued...
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| Japan Investment | Jul 01 - 2, 2008 | Country Summits |
| Global Real Estate | Jun 23 - 25, 2008 | Real Estate |
| Consumer and Retail | Jun 16 - 18, 2008 | Consumer Retail |
| Investment Outlook | Jun 09 - 12, 2008 | Financial Services / Exchanges |
| Global Energy | Jun 01 - 5, 2008 | Energy |
