A Trade Made for Buffett: Energy Stocks Priced Below Book Value

Here’s something you don’t see in the market too often: A third of all mid- and small-cap oil and gas stocks in the US are now trading below their book values.

That’s the highest level since the pandemic. And it’s a gift for value investors worshiping the gospel of Warren Buffett and his mentor, Ben Graham, who referred to these kinds of opportunities as “cigar butts.”

“We’re going to take advantage of a lot of suckers,” said Cole Smead, CEO of Smead Capital Management, who has been buying additional oil and gas stocks that are trading well below ...