Tyco's Woes Don't Dissuade Legg Mason's Miller
By: John Shipman, Of DOW JONES NEWSWIRES
NEW YORK -(Dow Jones)- The best time to buy stocks is during days like these, "when the outlook is poor and things are bleak," said Legg Mason portfolio manager Bill Miller.
He also hasn't become discouraged by what he calls stock price "anomalies in accounting-challenged companies," such as Tyco International (NYSE: TYC - News) Inc. and AES Corp. .
Miller's Legg Mason Value Trust, the firm's first equity mutual fund, was launched 20 years ago, and his comments came at a luncheon in recognition of its anniversary.
Known for beating his benchmark Standard & Poor's 500 Index 11 straight years, Miller compared today's investing environment with the atmosphere in 1990, when his streak began.
A recession, falling stock prices, rising oil prices and Iraq 's invasion of Kuwait were all catching headlines, Miller said. "Right now, we have a similar set of circumstances," he added.
At times like this, Miller and his team search for stocks they believe are mispriced and then hold them for the long term. That approach has led to some eyebrow-raising picks such as Tyco and AES, which have been hammered by investors. As Tyco's stock fell to $17 a share, Miller said he was looking at what to sell in his portfolio in order to purchase more Tyco shares, figuring they could climb 50% in 12 months.
At Tyco's current $11 share price, "there's no name we can't sell to buy Tyco, " he said. |
