“Financial companies in Italy fell so far that they were too inexpensive to pass up, according to Barton Biggs, the hedge-fund manager who said he purchased shares in the European nation.
Biggs said today that he bought a basket of Italian stocks three or four weeks ago weighted “heavily” toward banks. Intesa Sanpaolo SpA (ISP) and Unicredit SpA (UCG), the two biggest Italian banks by market value, have fallen to price-earnings ratios of 7.3 and 6, respectively, compared with the valuation of 14.3 for the MSCI World Index.
“The more we studied Italy, the more we felt that not only were Italian companies cheap, but the new government actually had a chance of making some real progress,” Biggs said today during an interview on Bloomberg Television’s “In the Loop” with Betty Liu today. “Something gets that cheap, we’re willing to take a shot at it.”
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