(Bloomberg) -- A global equity fund manager has pared his stakes in expensive western stocks such as ASML Holding NV and now favors cheaper Asian shares including Samsung Electronics Co.
The Dutch semiconductor equipment maker is a “super nice company” but was looking too pricey, said Klaus Ingemann, a portfolio manager at AllianceBernstein LP. Instead, he's particularly bullish on Samsung, for which he sees further equity gains despite lingering concerns over stagnant DRAM chip prices.
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“We reduced our most expensive growth stocks,” the Ingemann said from Copenhagen. His main fund, which has assets of about $2 billion, has beaten 94% of peers over the past five years. “We have Microsoft a little in the portfolio, but some the higher-growth names in the U.S. were just too expensive. So we tried to be a little bit conservative.”
Lately, Ingemann has been looking at cheaper companies in Asian nations like Japan, South Korea and Singapore. He favors a “neutral” strategy, balanced with value and growth shares with large to small market value across various sectors and regions.
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Shares of Samsung, South Korea's most-valuable company, have rallied 33% this year on hopes for a recovery in global memory makers. And yet, it's still trading at about 13 times estimated earnings for the next year, compared with 29 times for ASML.
Samsung reported quarterly earnings that beat analyst estimates earlier this month and will release its detailed results Thursday.
“Probably the demand is coming back in mid-next year,” Ingemann said. He expects a new smartphone cycle, 5G and re-acceleration of capital investment in cloud operations by Google and Amazon.com Inc. to be a boost. But that's not all, he added. “There's something interesting going on, as we see more cameras in self-driving, which will need more memory too.”
To contact the reporter on this story: Heejin Kim in Seoul at hkim579@bloomberg.net
To contact the editors responsible for this story: Lianting Tu at ltu4@bloomberg.net, Kurt Schussler, Cecile Vannucci
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