David Dreman has been the head of Dreman Value Management since 1977, opening the doors to his own investment firm after working as director of research and senior investment officer for a number of years previously. He is also a noted writer, contributing to Forbes Magazine and various behavioral finance publications. He currently manages $4bn in assets, down from $22bn in 2007, where he was faced with loss of value and redemptions in the following years. We were able to take a look at his latest 13F filings to see how his current investors are fairing with his largest positions.
Dreman’s largest holding is in Foster Wheeler, Ltd. (NASDAQ:FWLT), an international engineering, construction, and project management contractor and power equipment supplier. FWLT had a rocky year in 2012, starting the year with a price near $23, only to fall to lows near $16 during the summer, eventually recovering to slightly above where it started the year. As such, the stock only returned 6.6% on the year, and quarterly revenue growth was poor versus a year prior. In spite of that, the company is trading at a promising price relative to future earnings, and growth is expected in 2013, as Wall Street analysts have weighed in to give a potential one year price target near $30. We would wait for a more solid performer to hit our radars before diving in (see which fund manager has over $200mm invested in FWLT).
Coeur d’Alene Mines Corporation (NYSE:CDE) is Dreman’s second-largest holding, occupying just over 1% of his total assets under management (as such, one can infer that Dreman prefers diversification versus loading into positions). The precious metals miner has assets located globally, primarily in the U.S., South and Central America, and Australia. CDE was inline with the poor performance of commodities last year, chalking up a loss on the year; they also missed Q3 2012 earnings estimates by 43%. A number of hedge fund managers shaved their holdings in their last 13F filings, and you can see the degree to which they unwound their trades here.
The fund’s next holding is in the bank holding company Associated Banc-Corp (NASDAQ:ASBC). They primarily serve individual and corporate customers and contribute to Dreman’s heavy financial holdings. The company recently reported earnings on January 17th, meeting consensus estimates, but they have had to suffer through two downgrades this month alone, from buy to hold. ASBC does provide investors with a relatively attractive dividend yield of 2.3%, and with positive growth in earnings and revenues, an investor could certainly do worse (see which billionaire hedge fund manager has over $25mm devoted to ASBC).
What else tops Dreman’s list?