Every quarter, many money managers have to disclose what they’ve bought and sold, via “13F” filings. Their latest moves can shine a bright light on smart stock picks.
Today let’s look at Gabelli Funds, the mutual-fund and closed-end fund arm of GAMCO Investors Inc. (NYSE:GBL) and familiar to many because of Mario Gabelli, the well-known value investor. Indeed, the folks at Institutional Investor named him Money Manager of the Year in 2011, citing an average annual return of 16.3% for his GAMCO Investors Inc. (NYSE:GBL) since its inception in 1977. That’s darn impressive.
The company’s reportable stock portfolio totaled $16.4 billion in value as of March 31.
So what does Gabelli Funds’ latest quarterly 13F filing tell us? Here are a few interesting details.
The biggest new holdings are Liberty Media Corp (NASDAQ:LMCA) and Acme Packet, Inc. (NASDAQ:APKT). Other new holdings of interest include Cliffs Natural Resources Inc (NYSE:CLF) and payment processor VeriFone Systems Inc (NYSE:PAY). Cliffs Natural Resources inc (NYSE:CLF)’s stock is down more than 60% over the past year, and its 3.4% dividend yield is the result of a 76% dividend cut earlier this year. The company has struggled along with the coal market, but some are optimistic, seeing coal prices rebounding and demand growing, especially abroad. The stock has fallen so far that some see it as attractive now, but others worry about significant debt and negative free cash flow. On the plus side, Cliffs Natural Resources inc (NYSE:CLF) just inked a long-term iron-ore-pellet deal.
VeriFone Systems Inc (NYSE:PAY) has seen its stock roughly halved over the past year, as it has repeatedly posted disappointing quarterly results and weak guidance. Indeed, earlier this month, its latest results sent shares down some 20%. The company has an interim CEO at the moment, and bulls like a recent deal with China that bodes well for growth prospects abroad. With a single-digit forward P/E ratio, it’s seen as attractive by some, and as a possible acquisition target.
Among holdings in which Gabelli Funds increased its stake was snack seller Diamond Foods, Inc. (NASDAQ:DMND), which recently posted a surprising gain instead of an expected loss. Some have worried about shrinking nut sales and have seen the company as a possible acquisition target, while others think the company might want to do some shopping of its own. Diamond Foods, Inc. (NASDAQ:DMND) is also recovering from accounting-related troubles.