Bill Niglen, portfolio manager for Oakmark Fund since the 1980s, said Tuesday that investors should look outside the S&P 500 for opportunities as they have become the Megacap technology fund. A longtime value investor said he is picking up hidden gems outside the dominant technology sector and prioritizing strong companies with multiples of revenue from single-digit prices. The S&P 500 recently recovered to hit highs with a handful of megacup tech stocks, from Nvidia to Alphabet. Nygren said he likes retirement services company Corebridge Financial and has a robust buyback program. “It’s a competitive space, but it doesn’t claim it’s worth 20 times the revenue,” he said on CNBC’s “Closing Bell.” “Today is five times the revenue, and they’re repurchasing most of their capital in stock in five to seven years.” Another stock Nygren so far in the CRBG YTD Mountain Corebridge fiscal year finds Delta Air Lines attractive, with stocks falling significantly this year. “We like the Delta management team. The balance sheet is stronger than other major airlines and we like the demand for travel,” says Nygren. “This is a tough environment for discount airlines, and it gave major airlines the opportunity to raise prices a little and return to normal margins. With single-digit PE, it doesn’t want a lot of the company.” In July, Delta reported that its third quarter revenue and revenue forecasts exceeded estimates. CEO Ed Bastian said bookings have stabilized after less demand than expected. The Dal YTD Mountain Delta Air Lines was the airline line up until the year until Nygren’s last pick. He said he is bullish on the various assets of New Jersey drugmakers (e.g. vaccines, animal health, cancer treatments, etc.). “We believe (vaccines) will continue to be a good source of profit for them,” Nygren said. “They have a business of good animal health, and in the pipeline there are many experiments targeting specific cancers by combining Keytruda with other drugs. Mrk Ytd Mountain Merck
