Core Insights - The price-to-book (P/B) ratio is a key metric for evaluating stock value, calculated by dividing the stock's current price by its book value per share [1][2] - The P/B ratio is gaining traction as a tool for identifying low-priced stocks with high-growth potential, alongside traditional metrics like price-to-earnings (P/E) and price-to-sales (P/S) [2][3] Understanding Book Value - Book value represents the total value remaining for shareholders if a company were to liquidate its assets after settling all liabilities [4] - It is calculated by subtracting total liabilities from total assets, often equating to common stockholders' equity [5] P/B Ratio Analysis - A P/B ratio of less than one indicates that a stock is undervalued, while a ratio greater than one suggests it may be overvalued [6][7] - The P/B ratio should be compared within industries for more accurate assessments [6] - Limitations exist for the P/B ratio, particularly for companies with significant R&D expenditures or high debt levels [9] Investment Opportunities - Five stocks identified with low P/B ratios and strong growth prospects include AES Corporation, Harmony Biosciences, Concentrix, Patria Investments Limited, and Global Payments [3][10] - AES has a projected 3-5 year EPS growth of 11.2% and a Value Score of A [10][16] - Harmony Biosciences boasts a Zacks Rank of 1 and a projected EPS growth of 27.11% [10][17] - Concentrix has a projected EPS growth of 8.76% and a Value Score of A [17] - Patria Investments Limited has a projected EPS growth of 15.76% and a Zacks Rank of 2 [18] - Global Payments has a projected EPS growth of 11.54% and a Zacks Rank of 2 [19]

Core Insights - Identifying true value stocks requires thorough fundamental analysis beyond just key financial indicators like earnings per share and sales growth [1] Valuation Metrics - Investors often use valuation measures such as price-to-earnings (P/E) and price-to-sales (P/S) ratios, but the price-to-book (P/B) ratio is also a valuable tool for spotting attractively priced stocks with growth potential [2] - The P/B ratio is calculated as market capitalization divided by book value of equity, helping to identify low-priced stocks with high-growth prospects [2][6] - A P/B ratio of less than one indicates that a stock is undervalued, while a ratio greater than one suggests it may be overvalued [6][8] Book Value Definition - Book value represents the total value remaining for shareholders if a company were to liquidate its assets after settling all liabilities [4] - It is calculated by subtracting total liabilities from total assets, often equating to common stockholders' equity [5] Limitations of P/B Ratio - The P/B ratio is particularly useful for industries like finance and manufacturing but can be misleading for companies with significant R&D expenditures or high debt [9] - A P/B ratio of less than one may indicate weak returns on assets or overstated assets, while a ratio above one could suggest the stock is a takeover target [8][9] Screening Parameters - Stocks with a P/B ratio lower than the industry median are considered to have potential for price appreciation [12] - A lower P/S ratio compared to the industry average makes a stock more attractive [12] - A P/E ratio lower than the industry median is also a favorable indicator [13] - A PEG ratio of less than one indicates undervaluation with promising growth prospects [14] - Stocks should have a current price of at least $5 and a trading volume of over 100,000 for liquidity [15] Selected Low P/B Stocks - Invesco (IVZ) has a Zacks Rank of 1, a Value Score of B, and a projected 3-5 year EPS growth rate of 20.9% [16] - Harmony Biosciences (HRMY) holds a Zacks Rank of 1, a Value Score of A, and a projected 3-5 year EPS growth rate of 27.11% [17] - Concentrix (CNXC) has a Zacks Rank of 2, a Value Score of A, and a projected 3-5 year EPS growth rate of 8.76% [17] - Patria Investments Limited (PAX) has a Zacks Rank of 1, a Value Score of A, and a projected 3-5 year EPS growth rate of 15.39% [18] - Global Payments (GPN) has a Zacks Rank of 2, a Value Score of A, and a projected 3-5 year EPS growth rate of 11.54% [19]

Core Insights - The Royce Small-Cap Trust aims for long-term capital growth by investing at least 65% of its assets in small- and micro-cap equity securities [9] Performance Summary - As of December 31, 2025, the Net Asset Value (NAV) was $17.69, while the market price was $16.10 [1] - The average annual total return for the Fund as of December 31, 2025, was 14.03% for one year, 16.03% for three years, and 11.75% for ten years [1] Portfolio Diagnostics - The average market capitalization of the portfolio is $3.3349 billion [3] - The weighted average Price-to-Earnings (P/E) ratio is 19.1x, and the weighted average Price-to-Book (P/B) ratio is 2.2x [3][5] - The total net assets of the Fund amount to $2.16 billion [3] Portfolio Composition - The top five sectors by percentage of net assets are Industrials (25.6%), Financials (20.8%), Information Technology (14.1%), Health Care (9.8%), and Consumer Discretionary (9.5%) [8] - The top ten positions in the portfolio include IES Holdings (2.2%), Assured Guaranty (1.4%), and APi Group (1.2%) [8] Fund Characteristics - The Royce Small-Cap Trust is the oldest and largest small-cap closed-end fund with an average weekly trading volume of approximately 1,494,105 shares [7] - The Fund's adviser has over 50 years of experience in small- and micro-cap investments [7]

Core Insights - Berkshire Hathaway Inc. (BRK.B) shares are currently overvalued compared to its industry, trading at a price-to-book multiple of 1.48, which is above the industry average of 1.41 but below the median of 1.57 [1][8] - The stock has gained 0.9% over the past year, while the industry has decreased by 0.2%, with the sector and S&P 500 composite gaining 11.6% and 17.6%, respectively [2] - Analysts have set a Zacks average price target of $537.75 per share for BRK.B, indicating a potential upside of 11% from the last closing price [3] Business Model and Operations - Berkshire Hathaway operates as a conglomerate with over 90 subsidiaries, providing stability across various economic cycles [2] - The insurance operations contribute approximately 25% of total revenues and are crucial for long-term value creation, benefiting from disciplined underwriting and a large underwriting float [4][14] - The energy segment (BHE) offers steady cash flows and is expanding its renewable energy investments, aligning with global trends in electrification and sustainability [9] Financial Performance - Berkshire maintains a conservative capital allocation strategy, holding over $100 billion in cash and cash equivalents, primarily invested in short-term U.S. Treasuries [12] - The return on equity (ROE) for the trailing 12 months is 7.3%, below the industry average of 8%, but has shown consistent improvement [15] - The return on invested capital (ROIC) is 5.9%, lower than the industry average of 6.2%, yet has increased every year since 2020 [16] Analyst Sentiment and Future Outlook - The Zacks Consensus Estimate for 2026 revenues indicates a 6% year-over-year increase, while earnings are expected to decrease by 2.5% year-over-year [17] - Recent adjustments in earnings estimates show a 22.6% increase for 2026, contrasting with no movement for peers Chubb and PGR [17] - Berkshire's equity portfolio is being reshaped, with exits from certain stakes and new investments in companies like Alphabet, reflecting a focus on stability and long-term value [13]

Core Insights - Value investors often use the price-to-earnings (P/E) ratio to identify value stocks, but for loss-making companies with negative P/E ratios, the price-to-sales (P/S) ratio is utilized to assess their true value [1] - The price-to-book (P/B) ratio, while less commonly used, serves as an effective tool for identifying low-priced stocks with high return potential [1] P/B Ratio Calculation - The P/B ratio is calculated as market capitalization divided by book value of equity, helping to identify low-priced stocks with promising growth prospects [2] - A P/B ratio of less than one indicates that a stock is undervalued, while a ratio greater than one suggests it may be overvalued [5][6] Understanding Book Value - Book value represents the total value remaining for shareholders if a company were to liquidate its assets after settling all liabilities [3] - It is calculated by subtracting total liabilities from total assets, often equating to common stockholders' equity [4] Limitations of P/B Ratio - The P/B ratio is particularly relevant for industries like finance and manufacturing but can be misleading for companies with significant R&D expenses or high debt [8] - A P/B ratio of less than one may indicate weak returns on assets or overstated assets, while a ratio above one could suggest the stock is a takeover target [7] Screening Parameters for Low P/B Stocks - Stocks with a P/B ratio lower than the industry median are considered attractive for potential gains [11] - Additional screening includes P/S and P/E ratios below industry medians, a PEG ratio less than 1, and a minimum stock price of $5 [12][13][14] Recommended Low P/B Stocks - AES Corporation (AES) is a global power company with a projected 3-5 year EPS growth rate of 11.2% and a Zacks Rank of 2 [15] - BorgWarner (BWA) specializes in clean technology for vehicles, with a projected EPS growth rate of 10.2% and a Zacks Rank of 2 [16] - EnerSys (ENS) manufactures industrial batteries, holding a Zacks Rank of 1 and a projected EPS growth rate of 15.0% [17] - PG&E Corporation (PCG) is California's largest utility, with a projected EPS growth rate of 15.9% and a Zacks Rank of 2 [18] - Keros Therapeutics (KROS) is a biotech firm with a projected EPS growth rate of 36.5% and a Zacks Rank of 1 [19]

Core Viewpoint - The Royce Small-Cap Trust aims for long-term capital growth by primarily investing in small-cap and micro-cap companies, with a diversified portfolio that includes a significant portion of foreign securities [10][3]. Performance Summary - As of November 30, 2025, the Net Asset Value (NAV) is $18.23, while the market price (MKT) is $16.25 [1]. - The average annual total return for the Fund as of November 30, 2025, is as follows: - One-Month NAV: 2.47%, MKT: 1.56% - Year to Date NAV: 13.69%, MKT: 8.97% - One-Year NAV: 5.66%, MKT: 6.40% - Three-Year NAV: 14.03%, MKT: 11.62% - Five-Year NAV: 9.66%, MKT: 10.01% - Ten-Year NAV: 11.15%, MKT: 11.87% [1]. Portfolio Diagnostics - The average market capitalization of the portfolio is $3,409.4 million [4]. - The weighted average Price-to-Earnings (P/E) ratio is 19.4x, and the weighted average Price-to-Book (P/B) ratio is 2.2x [4]. - The Fund's net assets total $2.20 billion [4]. Portfolio Composition - The top ten positions in the portfolio and their respective percentages of net assets are: - IES Holdings: 2.4% - Assured Guaranty: 1.4% - APi Group: 1.2% - Arcosa: 1.1% - E-L Financial: 1.1% - Brady Corporation Cl. A: 1.0% - SEI Investments: 1.0% - International General Insurance Holdings: 1.0% - Sprott: 1.0% - Seneca Foods Cl. A: 1.0% [7][9]. - The top five sectors by percentage of net assets are: - Industrials: 24.9% - Financials: 20.2% - Information Technology: 13.5% - Health Care: 10.4% - Consumer Discretionary: 9.5% [9]. Company Background - Royce Small-Cap Trust is the oldest and largest small-cap closed-end fund, with an average weekly trading volume of approximately 1,170,399 shares [8]. - The Fund's adviser has over 50 years of experience in small- and micro-cap investments [8].

Core Viewpoint - The analysis indicates that among the seven agency mortgage REITs, three (AGNC, NLY, and DX) are significantly outperforming the other four (CHMI, ORC, TWO, and ARR), suggesting a potential investment strategy of going long on the top three while shorting the weaker ones [1][4]. Group 1: Investment Strategy - Investors are advised to focus on the top three REITs for long-term positions, while also considering trading opportunities within the sector [3]. - Pair trading strategies may be beneficial, but require a solid understanding of risk management when shorting high-yield shares [4]. Group 2: Performance Comparison - A detailed comparison of the Total Economic Return (TER) for each of the seven agency mortgage REITs is available, highlighting the performance differences [5]. - The weaker REITs have shown inconsistent performance, with some instances of recovery, but generally lag behind the stronger REITs [4]. Group 3: Valuation Insights - AGNC's estimated book value is approximately $8.55, with a current share price of $10.34, resulting in a price-to-book ratio of about 1.21x, which is considered high [6]. - Historical trends indicate that book value has generally trended down over the past 11 years, with a significant recovery post-pandemic, but current market pricing suggests an expectation of further increases in book value that may not be justified [12][9]. Group 4: Specific REIT Analysis - ARR has experienced significant declines in book value, dropping from an adjusted value of about $55.50 to approximately $17.49 since Q1 2020, despite paying out substantial dividends [16]. - The performance of ARR has been particularly poor, with reverse splits indicating severe financial distress, yet there are preferred shares that may still present investment opportunities [15][16].

Core Insights - American Financial Group, Inc. (AFG) has underperformed in the year-to-date period, with shares down 2.8% compared to the Finance sector and Zacks S&P 500 composite returns of 7.5% and 15% respectively [1] - The company has a market capitalization of $11.09 billion and an average trading volume of 0.4 million shares over the last three months [1] Valuation - AFG is currently trading at a forward 12-month price-to-book ratio of 2.35X, which is above the industry average of 1.48X [2] Growth Projections - The Zacks Consensus Estimate projects a 15.8% increase in earnings per share and a 6.1% increase in revenues for 2026 compared to 2025 estimates [3] Price Target - The average price target for AFG, based on short-term targets from five analysts, is $140.20 per share, indicating a potential upside of 5.5% from the last closing price [4] Return on Capital - AFG's return on equity (ROE) has improved, with a trailing 12-month ROE of 18%, significantly higher than the industry average of 8% [5] Growth Factors - AFG is positioned for growth through new business opportunities, increased exposure, and crop premium gains, supported by 37 consecutive quarters of renewal rate increases [8][9] - The company aims to maintain satisfactory rates in property and casualty (P&C) renewal pricing, with expectations to exceed prospective loss ratio trends [10] Underwriting Performance - AFG's combined ratio has outperformed the industry average for over two decades, aided by its specialty niche focus, product line diversification, and underwriting discipline [11] Dividend Policy - AFG has increased its dividend for 19 consecutive years, reflecting financial stability and robust operating profitability in the P&C segment [12] - Total dividend payments and share repurchases over the last five years amounted to $6.9 billion, with a 10% increase in the quarterly dividend starting October 2025 [13] Conclusion - AFG's prudent capital deployment, favorable renewal rate environment, and improved combined ratio make it an attractive investment [14] - Despite its expensive valuation, the company is expected to benefit from strategic acquisitions and favorable growth estimates, suggesting a hold recommendation [15]

Core Insights - Investors primarily utilize price-to-earnings (P/E) and price-to-sales (P/S) ratios for stock evaluation, while the price-to-book (P/B) ratio serves as an additional metric for identifying undervalued stocks with growth potential [1][5][10] Group 1: P/B Ratio and Its Importance - The P/B ratio is defined as the ratio of stock price to book value, calculated as market capitalization divided by book value of equity [2] - A P/B ratio of less than one indicates that a stock is trading below its book value, suggesting it may be undervalued and a good buy [5] - Conversely, a P/B ratio greater than one suggests the stock may be overvalued [5][6] Group 2: Book Value Definition - Book value represents the total value remaining for shareholders if a company were to liquidate its assets after settling all liabilities [3] - It is calculated by subtracting total liabilities from total assets, equating to common stockholders' equity on the balance sheet [4] Group 3: Limitations of P/B Ratio - The P/B ratio is particularly useful for industries with tangible assets, such as finance and manufacturing, but may be misleading for companies with high R&D expenses or significant debt [8] - A low P/B ratio could indicate weak asset returns or overstated assets, while a high P/B may suggest a company is a takeover target [7] Group 4: Stocks with Low P/B Ratios - StoneCo (STNE) has a low P/B ratio with a projected 3-5 year EPS growth rate of 30.3% and a Zacks Rank of 2 [9][15] - Great Lakes Dredge & Dock (GLDD) also features a low P/B ratio with a projected EPS growth rate of 12.0% and a Zacks Rank of 1 [9][16] - Keros Therapeutics (KROS) is highlighted with a projected EPS growth rate of 23.6% and a Zacks Rank of 1 [9][20] Group 5: Screening Parameters for Investment - Screening for stocks involves comparing P/B, P/S, and P/E ratios against industry medians to identify attractive investment opportunities [11][12][13] - A PEG ratio of less than 1 indicates undervaluation relative to future growth prospects [13] - Stocks should have a minimum trading price of $5 and a substantial average trading volume for liquidity [14]

Core Insights - Value investors traditionally use the price-to-earnings (P/E) ratio to identify value stocks, but for loss-making companies, the price-to-sales (P/S) ratio is more relevant. The price-to-book (P/B) ratio is also a useful tool for identifying undervalued stocks with high return potential [1][5][9]. Valuation Ratios - The P/B ratio is calculated as market capitalization divided by book value of equity, helping to identify low-priced stocks with high growth prospects [2][5]. - A P/B ratio of less than one indicates that a stock is trading below its book value, suggesting it may be undervalued, while a ratio above one may indicate overvaluation [5][6]. - The P/B ratio is particularly useful for industries with tangible assets, such as finance and manufacturing, but can be misleading for companies with high R&D expenses or significant debt [8]. Book Value Definition - Book value represents the total value remaining for shareholders if a company were to liquidate its assets after settling all liabilities, calculated by subtracting total liabilities from total assets [3][4]. Screening Parameters - Stocks with a P/B ratio lower than the industry median are considered to have potential for price appreciation [11]. - Additional screening criteria include a P/S ratio below the industry median, a P/E ratio below the industry median, a PEG ratio less than 1, a current price of at least $5, an average 20-day volume of at least 100,000, and a Zacks Rank of 1 or 2 [12][13][14]. Selected Stocks - Five stocks identified with low P/B ratios and solid growth potential include: - **StoneCo (STNE)**: Financial technology solutions provider with a projected 3-5 year EPS growth rate of 30.3% and a Zacks Rank of 2 [15]. - **Great Lakes Dredge & Dock (GLDD)**: Largest U.S. dredging services provider with a projected EPS growth rate of 12.0% and a Zacks Rank of 1 [16]. - **EnerSys (ENS)**: Manufacturer of industrial batteries with a projected EPS growth rate of 15.0% and a Zacks Rank of 2 [17]. - **MillerKnoll (MLKN)**: Design solutions provider with a projected EPS growth rate of 12.0% and a Zacks Rank of 2 [17]. - **Keros Therapeutics (KROS)**: Clinical-stage biotech with a projected EPS growth rate of 23.6% and a Zacks Rank of 1 [18].