Forestar Group Inc. (FOR), Service Corporation International (SCI), Dominion Diamond Corp (DDC): Gratia Capital’s Top 3 Picks

Steve Pei’s Gratia Capital disclosed last week its long equity positions as of June 30, 2014. The fund´s second quarter portfolio, which has a market value of more than $195 million, is focused on financial stocks (40%) and consumer discretionary stocks (20%). Over the period, Gratia started 19 new stock positions, increased its stakes in 12 of its preexisting holdings, and sold out of 15 previously held positions. In this article, we will take a look at the fund’s top 3 positions, which changed considerably over the quarter.

Mr. Pei’s largest bet was placed on Forestar Group Inc. (NYSE:FOR), which ascended from the ninth position that it occupied by the end of the first quarter. This $698 million market cap real estate, and oil and gas company saw Gratia Capital purchase 122,152 shares over the quarter. After increasing its stake by 31%, the fund owns 506,692 shares of Forestar Group Inc. (NYSE:FOR), worth almost $10 million.

Forestar Group Inc. (NYSE:FOR)

Jeffrey Bronchick’s Cove Street Capital also boosted its exposure to Forestar Group Inc. (NYSE:FOR) over the second quarter of the year. The fund disclosed ownership of 1.56 million shares of the company, worth almost $30 million, following a 12% increase in its position.

As outlined in a previous article, the stock was trading close to the low end of its 52-week range during the first two months of the second quarter. This provided an attractive entry point for investors, and it looks like both Mr. Pei and Mr. Bronchick took advantage of this situation. Since early-June, however, the stock has started inching, and has returned more than 17% -between June 4 and August 11.

Second on this list – although the fund trimmed its exposure by 30% over the quarter – is Service Corporation International (NYSE:SCI), a $4.5 billion market cap provider of deathcare products and services in North America. Gratia Capital disclosed ownership of 414,042 shares of the company, worth roughly 8.5 million, which account for more than 4.3% of its total equity portfolio.

David Cohen and Harold Levy’s Iridian Asset Management is placing even larger bets on Service Corporation International (NYSE:SCI). This fund, which is the largest hedge fund shareholder of record (amongst those we track), disclosed an 11% increase in its exposure to the company over the second quarter. Iridian now owns 8.08 million shares of Service Corporation International (NYSE:SCI), with a market value of more than $167 million.

Dominion Diamond Corp (NYSE:DDC), formerly known as Harry Winston Diamond Corporation, is the last company in this list. This $1.2 billion market cap diamond mining company felt Gratia Capital’s bullishness over the second quarter, as the fund upped its bet by 20%, to 569,556 shares. The fund had started a position at Dominion Diamond Corp (NYSE:DDC), with 473,350 shares, over the first quarter of the year. Its current stake is worth roughly $8.2 million, and accounts for 4.2% of the fund’s equity portfolio’s total market value.

Another major hedge fund manager that seems bullish on Dominion Diamond Corp (NYSE:DDC) is Mario Gabelli. His fund, Gamco Investors, acknowledged a 12% increase in its stake in the company over the second quarter. Gamco now holds 349,000 shares of the company.

Disclosure: Javier Hasse holds no position in any stocks or funds mentioned

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

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

10 High Paying Seasonal Jobs in America this Holiday Season

The 10 Busiest Shipping Lanes in the World

5 Most Valuable Brands in China

The 10 States with Highest Substance Abuse Rates Crippling Their Populace

The Top 10 Things to Do Before You Die That Will Echo for Eternity

The 10 Best Selling Items on Etsy

Top 10 Things to Do in Tokyo, the Greatest City in the World

10 Mistakes on Social Media that Can Harm You and Will Probably Get You Canned

The 10 Best Cities to Find Jobs in 2014

The 10 Most Controversial Songs Of All Time to Hit (and get Banned from) the Airwaves

The 20 Biggest IPOs in US History

The 10 Best Places to Visit in Mexico that Are Beautiful and Safe

7 Bad Habits that Age You Beyond Your Years

The 40 Best Fortune Cookie Sayings That Will Leave You Bemused, Befuddled, or Beguiled

10 Foods to Eat Before a Workout to Make Every Drop of Sweat Count

The 5 Best Documentaries On Netflix You Must See

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!