Value Stocks for 2011

In line with my post on November 16th, 2010 about overwhelming empirical evidence of outperfomance of value stocks presented by Prof. Robert A. Haugen, I would like to present some attractive stock picks:

• USA
  Some tech stocks are highly profitable and reasonably priced. They are no longer growth stocks but rather value stocks although they are more volatile than classic value stocks: HP (HPQ), IBM, Intel (INTC) and Microsoft (MSFT). Oil shares such as Chevron (CVX) as well as ConocoPhillips (COP) are also cheap and moreover less volatile than average stocks.
• Euro zone
  My favorite defensive stock in the Euro area are RoyalDutch (RDSa) and Unilever (UN) with low market risk and low valuation.
• UK
  British American Tobacco (BATS) and BP are low priced stocks with low market risks, although they carry some sector (tobacco) or company specific risks (litigation due to oil spill).
• Switzerland
  The two pharmaceutical giants Novartis (NOVN) and Roche (ROG) can be bought cheaply and exhibit very market risk. BKW (BKWN),a mid cap electric utility company, is also very attractive regarding risk and valuation.

These picks should do well mid to long term in a buy and hold framework. They are all traded at a discount compared to sexy but pricey growth stocks. Soon or later the market will value their quality, just be patient!