Investors have been overpaying for dividend stocks while undervaluing those firms buying back shares, Oakmark's Bill Nygren tells the crew at Fast Money. Investors should treat both the same, but the stocks of repurchasers aren't as expensive, he says.
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Among his favorite picks are Bank of America (BAC) and JPMorgan (JPM). "What we see here is really low P/Es relative to the market and relative to their own history ... These companies sell at about 8x the level that we think they'll earn after the legacy mortgage costs stop going through the income statement."
Other top picks are Apache (APA) - selling assets for close to full value and buying back shares - Haliburton (HAL) - which has tendered to repurchase 4-5% of its shares - and DirecTV (DTV) - also buying back stock.