P/E Ratio by Position mid May Update

I last looked at this measure in mid January [Jan 20: P/E Ratio for Portfolio] so now 4 months later it's time to take a fresh look. I won't rehash all my thoughts on P/E ratios (you can follow the link) but at a 40,000 point of view

1. I like earnings; it is very hard for me to value stocks with no earnings i.e. valuing hope or earnings in 2011 is difficult. (US housing is the only example of stocks I have right now with no earnings)
   
2. At heart, while not a pure value investor, I am a relative value investor - i.e. all things being equal I prefer growth at a reasonable value. This seems to work very well in all sectors except solar where the most expensive stocks seem to get rewarded by trigger happy speculators....err, investors.
3. I look forward, not backward - what I've done here is look at Dec 2008 estimates - or if the stock has a different year end than December, the nearly yearly period to December. If you looked backward you would of missed the entire fertilizer run, deeming the stocks 'expensive' when in fact they were dirt cheap based on what was coming in the upcoming quarters.
   
4. In most cases I try to buy stocks I believe the analysts are missing part of the story and understating earnings potential - so the P/E ratios below are not necessarily what I believe to be true (fertilizer has been a great example of this, which the analysts have been so wrong for so long)
5. Except for the 2 investment banks (and US housing) I believe almost every company will beat current analyst estimates for the year, and this is the whole basis for my investing style.
6. Aside from a few names I expect 2009 earnings to show meaningful growth over 2008...
7. In some sectors, I believe 2009 growth will be so good, I am looking past somewhat average 2008 estimates and looking out 1 more year (coal being the best case)
8. I am willing to pay up for scarcity value (i.e. hard to replicate business models or hard to enter businesses) I truly have no way to value a Baidu.com for example - so I think P/E ratio is useless for these.
9. I do pullback exposure when valuations seem to get rich (in my opinion) versus growth rates - we can see that now in Mastercard, Fluor, and a few other names - while I like the companies, I just cannot put a large weighting to stocks that are this rich to growth rates.
10. An 18 P/E ratio in 1 sector might be expensive, whereas it might be cheap in another - hence I only compare P/E ratios among peers
    
11. P/E ratio is but one of many measures one can use; and as with most things its an art not a science. If you approach it as a science of absolutes, you will miss out on many opportunities. It is but one tool in a very large tool kit.

Below are all my non ETF holdings, sorted by sector. I've sorted within each sector the stock with the largest weighting at the top, and the farther down the list, the lower the portfolio weighting is.

In general you will find most of the stocks I own as relatively cheap on full year 2008 estimates, especially in relation to their (relatively) high growth rates; especially the names I keep towards the top of the portfolio. Even within each sector, certain companies have major advantages which may or may not deem a premium multiple.

Agriculture - Fertilizer
MOS 11.5
POT 20.3
CF 10.8

Infrastructure
JEC 29.8
FWLT 23.0
MDR 20.7
FLR 29.6

Financial/Consulting
GS 11.5
BLK 24.5
MS 8.8
FCN 24.8
MA 32.8

Solar
TSL 15.8
YGE 27.5

Energy - Coal
ANR 33.1
MEE 21.1
CNX 33.7
ACI 24.6

Energy - Oil Service/Drillers
PDE 12.7
ATW 16.4
CLB 22.0
NOV 16.6

Energy - E&P esp. Natural Gas
EOG 17.4
XTO 17.7
COG 26.0

Energy - Everything
PBR 16.3

Metals/Mining
MTL (Russia) 15.1
RIO (Brazil) 14.0
CLF 16.6
SLT (India) 16.4

Healthcare
ISRG 59.1
ILMN 65.2

Technology - Computer/Communication
AAPL 36.0
RIMM 36.5

Technology - Internet
BIDU (China) 89.1
MELI (South America) 111.6

Home Builders
GFA (Brazil) 13.7
DHI (US) earnings? haha
LEN (US) earnings? haha
HXM (Mexico) 16.5

India Banks
HDB 25.5
IBN 19.1

China Misc
PWRD (gaming) 18.6
CTRP (travel) 53.1
HOGS (hogs) 10.1
SOHU (search/gaming) 33.0
EDU (education) 47.4
WX (medical outsource) 30.7

Industrial
CMI 15.6

Drybulk Shipping
DRYS 5.9