Bill Nygren, portfolio manager at Oakmark Funds for four decades, said he is focusing on cheap stocks that return meaningful capital to shareholders with the stock market trading at record highs. The widely followed value investor revealed that he is trying to find hidden gems that are a lot cheaper than the average stock in the S & P 500, which is trading at 23 times forward earnings. Nygren said almost half his holdings have multiples less than 12 times earnings. While his picks don’t offer exceptional organic growth, he looks for the companies that have solid repurchase or dividend programs in place. “These companies don’t have great organic growth opportunities, but they’re generating a lot of free cash flow that doesn’t need to be reinvested in the business and they do buybacks and dividends because of that, their dividends and per share growth rates are actually in line with companies that are three times as expensive,” Nygren said on CNBC’s ” Squawk Box .” The overall stock market has chugged along, reaching multiple record highs in late July, as investors cheered corporate profits that came in the face of higher tariffs. The S & P 500 has rebounded more than 30% from its April lows, up nearly 8% in 2025. One stock that Nygren has grown fond of again is Charter Communications , whose price-to-earnings ratio has dropped to about five times. “It’s becoming very interesting, as the business is almost entirely an internet and mobile telephone business today,” Nygren said. “Market knows that there’s not going to be a ton of organic growth, and I think what the market doesn’t pay for, as much as it should, is the growth that can come from share repurchase.” CHTR YTD mountain Charter Communications year to date Nygren also likes General Motors , which has been volatile this year due to tariff scares. After rallying 48% in 2024, the stock is about flat year to date. “The company was supposed to earn something like $10 a share this year. It’ll probably take a year or two to get back to that level, but at five times earnings, we think you’re getting paid an awful lot to take on that risk,” Nygren said on GM. GM YTD mountain General Motors year to date His other top value picks are Global Payments , Ally Financial , and Corebridge Financial .
Value investor Bill Nygren breaks down how he’s finding hidden gems in an expensive stock market
Aug 8, 2025
