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Dycom Industries (DY), FedEx Corporation (FDX) Among 12th Street Asset Management’s Top Picks at the End of Q1

12th Street Asset Management Company, LLC is a fund headquartered in Chicago, founded by Michael G. O’Keefe in 2007. As of the end of March, the company has an equity portfolio of $272.55 million with 46% invested in industrials, followed by transports and consumer discretionary sectors. According to the recent 13F filing, Michael G. O’Keefe’s top picks are: Dycom Industries (NYSE:DY), FedEx Corporation (NYSE:FDX) and Walgreens Boots Alliance, Inc. (NASDAQ:WBA).

FedEx Corporation (NYSE:FDX)
The reason we analyze the 13F filings of over 700 other prominent investors is because we determined that these filings can still provide some investment opportunities, despite a delay of 45 days after the end of a calendar quarter.  The key of our system is to focus on most popular small-cap picks among these investors. Through a series of backtests, which involved the equity portfolios of several hundred investors between 1999 and 2012,  we determined that their most popular small-cap ideas can beat the market by an average of almost one percentage point per month and generate a double-digit annual alpha. In the last three years, our strategy returned 28.2% in 2014, 53.2% in 2013, and 33.3% in 2012, compared to the S&P 500 ETF (SPY)’s 13.5% gain in 2014, 32.3% – in 2013, and 16% – in 2012 (read more details here).

On the first spot is Dycom Industries (NYSE:DY), in which the fund owns 650,394 shares, valued at $30.85 million. This represents 11.32% of 12th Street Asset Management’s portfolio as of the end of the first quarter of 2015. Dycom Industries provides a wide range of specialty contracting services to the dynamic telecommunications and infrastructure industry. According to the results for the second quarter of fiscal 2015, the company has registered a 10.5% increase on the year in contract revenues to $441.1 million. Moreover, the company turned to a profit of $0.27 per share, versus a loss of $0.09 in the second quarter of fiscal 2014. Donald Chiboucis’s Columbus Circle Investors initiated a stake in Dycom Industries (NYSE:DY) with 491,964 shares during the first quarter.

According to the last 13F filing, Michael G. O’Keefe disclosed a position of 175,045 shares of FedEx Corporation (NYSE:FDX), valued at $29.84 million. FedEx’s stock has remained almost flat since the beginning of the year, inching down by 0.14% amid news regarding its plans to acquire Netherlands-based TNT Express. The deal is valued at 8 euro per share, or 4.4 billion euro ($4.8 billion) in cash, a premium of 33% over the closing price of TNT’s stock at the beginning of April. The deal has to receive approval from antitrust authorities in the EU, China, Brazil and the US. Greenhaven Associates has disclosed a position of some 4.55 shares of FedEx Corporation (NYSE:FDX), valued at $791 million, which is the second-largest stake in its equity portfolio.

Walgreens Boots Alliance, Inc. (NASDAQ:WBA) is the third in 12th Street Asset Management’s portfolio with a position of 347,561 shares, with a market value of $29.30 million. Walgreens Boots Alliance, Inc. is a pharmaceutical manufacturing, wholesale and distribution holding, whose stock advanced by more than 10% year-to-date. The company posted earnings of $1.18 per share for the second quarter of fiscal 2015, up by 21.6% on the year and net sales of $26.57 billion, versus $19.61 billion a year earlier. With a cash flow of $1.0 billion at the end of the second quarter, Walgreens Boots Alliance, Inc. (NASDAQ:WBA) expects EPS between $3.45 and $3.65 for the full fiscal 2015. Other stakes in the company are held by Slate Path Capital, run by David Greenspan, and Eric Chen’s Antipodean Advisors.

Disclosure: none

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