Aegon N.V. (AEG)

(A Top Pick Dec 22/16. Up 17%.) A huge Dutch company that is in many, many countries. This could go up quite a bit. He can see it getting back over $20.

This is gathering momentum. It pays a dividend, and dividends are nice to have. Dividend yield of 4.9%. (Analysts’ price target is $5.94.)

(A Top Pick Dec 22/16. Up 15%.) A huge Dutch insurer and operates in many countries. Had huge problems during the recession and had to be bailed out by the Dutch government. They seem to be getting their house in order. They could be on the comeback trail. They’ve been doing well over the past year. It wouldn’t surprise him if this ultimately tripled.

A survivor from the financial meltdown. European financials have done pretty well over the last year. They cut the dividend, so that should be fairly safe. It is really a question of, what do you think the outlook is for European economies. While the ECB has been very kind in helping European banks, you have to worry longer-term. If you made a gain on this, it might not be a bad idea to at least take some profits.

Had paid $7.46, but it is down. They seem to be turning around and making money. Pays a nice dividend of 5.2%. Gives a nice geographic diversification. Based in Holland, but operates in over 15 countries. Huge insurance company. (Analysts’ price target is $5.60.)

A life insurer in the US and the Netherlands. It is going to be a huge beneficiary of rising interest rates. Selling at an unbelievable cheap valuation, about half of tangible BV. Dividend yield of 5.3%. (Analysts’ price target is $5.60.)

A frustrating name. He likes financials and thinks there is promise. The bullish case is that it is trading well below BV and no one is paying any attention to it. The challenge is that it is in the insurance group which is still frustrated by low interest rates, and it is very hard to make money on their float. They have some risky assets that they are trying to spin off. Their execution has been very poor, but he thinks there is some promise.

He bought ING-N because they have the banking side with it. AEG-N is a good competitor. He is not negative about AEG-N, but found more positive things in ING-N.

It used to be a $50 stock. They had been selling off assets to comply with the new Euro regulations. They bottom line is good and they have tremendous upside. He thinks at the end of the day they will do well. They got bailed out by the Dutch government. If they get in trouble again maybe the Dutch government will step in again. They seem to be on the right path. (Analysts’ target: $5.60).

He was concerned about their capital, and was right. They had to flow $1 billion down to their Dutch subsidiary. They also got special dispensation from the regulator, to allow them to treat a certain amount of their tax loss carry forward of capital, which has helped them with their capital position. The whole life insurance space has lifted along with interest rates. He is not involved in life insurance because it is driven by interest rates, and he can’t guess where rates are going to go. Has never taken this seriously as an investor because of their behaviour in treating shareholders over the last 15-20 years.

(Top Pick Jan 20/16, Down 0.9%) Because of the new regulations they sold some of their US operations. Their recent earnings were not bad. They keep selling and buying operations and it makes it difficult to see where they are. His target is over $20. It pays a lovely dividend. He is waiting to see. It is taking much more time than he thought it would to move upwards.

It still has upside potential. In 2008 the Dutch government bailed them out and so now they still want them to continue. (Analysts’ target: $5.06).

(A Top Pick May 19/16. Up 7%.) This offers a 4%+ dividend. He thinks it is worth double the current share price. Trading at a huge discount to its tangible BV. The reason it has underperformed is because of housing market issues in the Netherlands. With the improvement in the European economy in general, that will be a boost for this company.

(Top Pick Jan 20/16, Down 1%) His partners doubled down. They had a lot of problems in 2008 and had to be bailed out. He can see it doubling or tripling. They keep buying and selling things and he likes more stability in an organization. He loves the dividend, though.

He would prefer ING Groep NV (ING-N), which is very cheap and trading at around Book right now. Expects rates in Europe will start to rise, and he would focus on the highest quality names.