Financials Dominate Ariel Investments’ Top Holdings

Page 1 of 2

Now in its thirtieth year of existence, Ariel Investments is a dinosaur relative to some of the fly-by-night funds that have come and gone in the twenty-first century, many of which succumbed to the flight of assets and loss of value during the 2008 market turmoil. Started by Princeton-alum John W. Rogers in 1983, the fund has grown to manage over $4.6bn in assets as of its last 13F filing in September of 2012. Diving into the SEC document let us take a glimpse at his five largest holdings and gave us some insight as to Rogers’ main areas of investment focus.

First American Financial Corp

First American Financial Corp. (NYSE:FAF) tops the list of fund holdings, with approximately 4% of assets employed in the stock. FAF has been one of Roger’s top holdings since early last year, and it has been quite the winner for him. In the last year alone, the stock price has increased 76%, helped along by multiple earnings beats and upgrades by the likes of Barclays. The financial services provider has an alarmingly low PEG of 0.24, but we’re worried that the rise from trailing P/E to forward P/E could be evidenced by a smaller projected stock price in the future. We concur with analysts on the Street that this is a hold and an investor jumping in now may have missed the boat.

Next up is the financial advisory and asset management company Lazard Ltd. (NYSE:LAZ). With clearly defined global streams of business, Lazard has avoided some of the convoluted chaos that claimed some of the world’s largest banks and asset managers. However, the volatility versus the market still exists with the stock’s high beta of 2, and a very high price-to-book ratio of 5.46 throws up some red flags. Despite a respectable gain in 2012, analysts are pulling in the reigns, and we expect the price one year out to be a dollar less than where it’s trading now ($33 versus a close of $34.01 on January 18th) (check out what other insiders think of LAZ here.)

Rogers currently has over $180mm employed in the international media and marketing company Gannett Co Inc (NYSE:GCI), most notably known for publishing the newspaper “USA Today”. Large newspaper players (including competitors News Corp and the New York Times) have been struck with hard times during the rise of the web, but financial metrics look positively upon GCI. While margins may not be as glamorous as before digital circulation, GCI trades at a respectable forward price-to-earnings of 9 and has both positive quarterly earnings and revenue growth over the same period a year prior. In this specific case, Rogers may be chasing the impressive dividend yield of 4%, the highest of his top five holdings.

Read on to see the rest of Ariel’s top stocks.

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

10 Top Reasons For Getting Fired

The 3 Best States to Start an LLC

10 Jobs That Allow You to Travel

7 High-Paying Jobs You Can Do From Home

12 Best Cities to Shop in USA

10 Best States To Practice Medicine

The 10 Best States to Have a Business

The 12 Most Expensive Apple (AAPL) Apps in the Market

The 10 Richest Billionaires in the World

10 Biggest Kickstarter Failures

The 10 Best Places to Work At

The Top 10 of Google Inc (GOOGL)’s Most Expensive Acquisitions

13 Best Cities to Visit in South America

10 Most Expensive Works of Art of All Time

The 10 Richest Banks in the World

The 10 Best-Paying Jobs in America (2014)

7 Most Expensive Foods in the World

The World’s Top 10 Earning Authors

Five Wicked and Very Expensive Items (and Other “Stuff”) Sold on eBay

10 Biggest Celebrity Bankruptcies

The Top 10 Highest Paid CEOs in 2014

The 10 Most Expensive Real Estate Cities in America

10 Most Expensive States To Live In America

The 10 Best Airlines in the World

The 10 Best-Selling Cars in 2014

The 10 Best Industries to Invest In

The 10 Most Expensive States to Own a Car In

Top 10 Business Schools in US: 2014 Rankings

Top 20 Female Billionaires in 2014

6 Movies That You Should Watch to Better Understand The Cold War

Top 15 Best Paying Jobs for Women in 2014

Top 6 Things Rich People Do Differently Every Day

5 Retirement Mistakes To Avoid (and Einstein’s Famous Quote)

11 Smartest People in the World

6 Films About the Financial World You Need To Watch (While “The Wolf” is Not Around)

Warren Buffett and Billionaires Are Crazy About These 7 Stocks

The Top 10 States With Fastest Internet Speeds

10 Best Places to Visit in USA in August

Top 10 Cities to Visit Before You Die

Top 10 Genetically Modified Food In the US

15 Highest Grossing Movies Opening Weekend

5 Best Poker Books For Beginners

10 Strategies Hedge Funds Use to Make Huge Returns

Top 10 Fast Food Franchises to Buy

10 Best Places to Visit in Canada

Best Summer Jobs for Teachers

10 Youngest Hedge Fund Billionaires

Top 10 One Hit Wonders of the 90s

Fastest Growing Cities In America

Top 10 U.S. Cities for Freelancers

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!