Billionaire Ken Fisher Adds to Stake In Veeco Instruments

Page 1 of 2

Fisher Asset Management, managed by billionaire Ken Fisher, has reported that it owns 2.2 million shares of Veeco Instruments Inc. (NASDAQ:VECO), giving it ownership of 5.6% of the total shares outstanding. Veeco is a $1.3 billion market cap company which manufactures equipment that is then used by other technology companies to produce LEDs, solar products, and hard disk drives among others. This is an increase in Fisher’s position from the end of September, going by the fund’s 13F filing at that time.

We think that it’s particularly important to pay attention to what notable investors are doing in the small cap space (of course, blindly following these investors may not be a wise strategy). For example, we identified the most popular small cap stocks among hedge funds in our August newsletter and that portfolio went on to produce an excess return of 18 percentage points between September and January (read more about our hedge fund strategies).

Ken Fisher FISHER ASSET MANAGEMENTIn the third quarter of 2012, Veeco’s revenue fell by 53% compared to the same period in 2011. With margins shrinking as well, earnings decreased by over 60%. Recent bottom-line performance and the current market cap places the stock at 21 times trailing earnings, and Wall Street analysts expect continued decay in net income this year; as a result the current-year P/E is 28. That seems like a high valuation for a company which has been seeing sharp declines in business. Veeco Instruments Inc. is a very popular short, with 27% of the outstanding shares held short. This demonstrates a sizable bearish community, though it means that the stock is probably expensive to short. We would note that it does have a very large cash hoard- cash on the balance sheet came out to nearly $600 million, a large portion of its market cap- but even when we look at the company’s enterprise value and cash flow the valuation does not look particularly attractive at an EV/EBITDA multiple of 7.0x.

Chuck Royce’s Royce & Associates owned 3.7 million shares of Veeco Instruments Inc. at the end of the third quarter of 2012 (find Royce’s favorite stocks); that fund tends to concentrate on small-cap and mid-cap stocks. Joho Capital, which is managed by Tiger Cub Robert Karr, owned about 940,000 shares according to its own 13F filing (check out more stocks Joho owned). First Pacific Advisors, which is managed by Robert Rodriguez and Stephen Romick, cut their stake during the quarter but still owned about 710,000 shares at the end of September.

Are any of Veeco’s peers better value prospects?

Page 1 of 2
blog comments powered by Disqus
Insider Monkey Headlines
Insider Monkey Small Cap Strategy
Insider Monkey Small Cap Strategy

Insider Monkey beat the market by 52 percentage points in 24 months Click to see monthly returns in table format!

Lists

50 Crazy Facts About Japan You Won’t Believe

Top 10 Least Expensive Hybrid Cars to Save the Planet With

The 10 Biggest ‘Gate’ Controversies in History

The 10 States with the Highest Nursing Shortages Leaving Their Hospitals Depleted

The 10 Best Value Investment Blogs that Every Investor Must Read

The 6 Cheapest Boarding Schools in Europe 2015

The 5 Most Expensive Cars To Insure in the World

The 10 Most Common Genetically Modified Foods

10 Self-Made Billionaires Who Came From Nothing

The 10 Most Expensive Cities to Live in North America

The 13 Most Expensive Headphones in the World to Represent

The Top 20 Wealthiest Soccer Teams in 2014

4 BuzzWorthy Cannabis Stocks And Some Smoking Derivative Plays

The 10 Healthiest Fast Food Chains in America to Dine At

The 5 Most Expensive Cat Food Brands You Can Spoil Your Kitty With

The 6 Best eCommerce Platforms for Small Businesses

The 10 Worst Mistakes an Entrepreneur Can Make

The 5 Most OP Characters in League of Legends to Carry Games and Crush Foes With

The 5 Best Foods to Eat Before Running that Will Help You Pound the Pavement

10 Glaring Plot Holes in The Walking Dead that a Zombie-Filled Bus Could Drive Through

The 5 Biggest Celebrity Stoners Who Love Their Reefer

The 10 Most Overrated Movies Of All Time by Out-of-Touch Critics

Top 6 Least Expensive Cruise Destinations For 2015 that Will Take You to Paradise

10 States with Lowest Substance Abuse Rates in America

The 14 Most Watched TV Finales Ever

The 10 Best Selling Role Playing Games of All Time for PC

10 Most Influential Papers In Economics

Top 8 Biggest Charities in the US

10 Worst Celebrity Career Moves Ever

Top 10 Best Paid Tennis Stars in the World

10 Cities with High Demand for Nurses

6 of the Worst Greeting Card Messages Ever Crafted

How to Make Money in ArcheAge and Build Your Empire

10 Foods To Eat To Lower Cholesterol Levels

The 10 Most Hated Television Characters of All Time

The 30 Worst Halloween Costume Ideas Ever Brought to Horrible Life

10 Vocational Skills in Demand Today with Jobs Waiting to be Filled

10 Best Places to Visit in Central and South America

The 10 Greatest Empires in History Which Nearly Conquered the World

The 6 Cheapest Boarding Schools In America 2015

5 Clear Reasons LoL is Better than DotA, Continues to Rule MOBAs

The Only 9 Teams with a Chance to Win the Super Bowl

The 15 Most Common Phobias in America that Induce Fits of Panic

Top 6 Least Expensive Tourist Destinations in 2014

Jim Goetz, Peter Fenton, Jim Breyer: Top 6 Venture Investors for 2014

Top 15 Billionaires in 2014

5 Pitfalls To Avoid When Buying a Franchise

Top 20 Medical Schools in the US – 2014 Rankings

4 Business Strategies that Turned Jamie Oliver into the World’s Richest Chef

6 Qualities That Make You A Good Team Player

Subscribe

Enter your email:

Delivered by FeedBurner

X

Thanks! An email with instructions is sent to !

Your email already exists in our database. Click here to go to your subscriptions

Insider Monkey returned 47.6% in its first year! Wondering How?

Download a complete edition of our newsletter for free!