Herbalife Ltd. (HLF), Express, Inc. (EXPR) Among Joel Greenblatt’s Key Bets

Page 1 of 2

GOTHAM ASSET MANAGEMENTJoel Greenblatt is well known in the value investing community, having penned a number of books on investing, including You Can Be A Stock Market Genius, in addition to developing his famous “Magic Formula” strategy. Greenblatt focuses primarily on special situations, and some of his investing activity is reported to the SEC via 13F filings. Outlined below are five of Gotham Asset Management’s most important bets heading into the new year (check out Joel Greenblatt’s latest picks).

Express, Inc. (NYSE:EXPR) saw Gotham increase its stake almost 90% last quarter. The clothing retailer posted 3Q results of $0.20 compared to $0.37 year over year. The decline was on the back of 5% lower comp sales and 4% lower sales due to a weak global economy and consumer spending. The retailer recently revised 4Q earnings downward and now expects comp sales to decrease in the low-single digits. With the weakness, the retailer is now the cheapest in the industry at 9x earnings, compared to Rue 21 (16x), Aeropostale (16x) and Gap (15x). Although the stock has seen pressure of late, we believe it could be a solid value opportunity trading at a PEG of only 0.5; its long-term expected EPS growth rate is a whopping 19%. A number of billionaires were invested in Express last quarter, including Jim Simons, Ken Griffin and D.E. Shaw (check out D.E. Shaw’s big bets here).

Deluxe Corporation (NYSE:DLX), meanwhile, saw Gotham up its stake 50% last quarter. Deluxe should manage to see positive performance as economic activity improves in the interim, but a longer-term headwind is the rise of online storage and payment processing, which is decreasing the need for printing. We remain cautious on the printing industry’s prospects given the rise in digital and electronic technologies. Deluxe’s potential, then, remains limited and its 5-year expected EPS growth rate is a low 6%.

Nu Skin Enterprises, Inc. (NYSE:NUS) saw Gotham increase its stake 150% last quarter. Nu Skin sells personal care products in a space that has been seeing pressure lately, due to a continually elevated unemployment rate. Additional issues will come from lower-priced competitors, but the majority of problems over the interim may be related to the Herbalife fallout, which we’ll discuss below. Still, the company’s long-term growth prospects look robust, as exhibited by its 5-year expected earnings growth rate of 17%. Nu Skin calls billionaire Jim Simons as one of its big name investors (see all of Jim Simons’ top picks).

What are the remaining two?

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

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

Top 9 Most Popular Free iPhone Apps

Top 10 Least Expensive Private Business Schools in the US

Top 15 Most Expensive Countries in the World – 2014

Top 6 Tax Scams and How to Protect Yourself

Top Businesses to Invest In

Top 5 Things You Might Be Doing Wrong With Your Business

Top 5 Strategic Technology Trends in 2014

Top Rags to Riches Stories

Parenting Behavior That Promotes Future Leaders

Top 5 Mistakes Made by Small Businesses

Top 5 Most Common and Potentially Devastating Financial Blunders

Top 5 Highest Paying Jobs for Web Designers

Top 6 Most Respected Professions that Also Pay Well

Top 5 Pitfalls Investors Should Avoid

Top 6 Lawyers and Policy Makers Under 30

Top 6 New Year’s Resolutions for Entrepreneurs

Top 7 Locations to Check in on Facebook

Top 5 Mistakes made by Rookie eBay Sellers

Top 7 eBook Publishers in 2013

Top 6 Health Industry Trends in 2014

5 Lessons for Entrepreneurs from Seth Godin

Top 5 Success Tips from Jordan Belfort – the Wolf of Wall Street

Best Master’s in Finance Degree Programs

Top 6 Earning Celebrities Over 50

The most expensive sports to play

Top 7 Earning Celebrities Under 25

Best 7 Online Courses to Take: Free Finance MOOCs

Top 6 Bad Habits that Promote Failure

20 Most Valuable Soccer Teams in the World in 2013

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!