Iridian Asset Management Owns 6% of W.R. Grace

Page 1 of 2

A 13G filed with the SEC has disclosed that Iridian Asset Management, a special situations fund managed by David Cohen and Harold Levy, now owns 4.5 million shares of W.R. Grace & Co. (NYSE:GRA). W.R. Grace is a $5.4 billion market cap specialty chemicals company best known for its catalysts which are used to convert oil into transportation fuels. In the third quarter of 2012, Iridian increased its stake in the company by 52%, to a total of 2.7 million shares; this new filing reports an increase of 67% from that level. We calculate that at the current stock price of about $71.80 per share Iridian’s position is worth over $320 million, which would make it among the largest- if not the largest, as it would have been in Q3- positions by market value in the fund’s portfolio. Find more of Iridian’s favorite stocks.

W.R. Grace & Co. (NYSE:GRA)

In the third quarter of 2012, W.R. Grace & Co. experienced a 10% decline in revenue; this reversed the trend of top-line growth that the company had shown in the first half of the year. While W.R. Grace did reduce its COGS and SGA expenses, and margins actually improved despite the fall in sales, earnings did end up decreasing by 7%. The catalyst business, which is the largest source of revenue and responsible for over half of segment operating income, was the primary culprit: revenue and operating income there were each down close to 20%.

The markets are pricing in a recovery at the company, with the current price representing a trailing P/E of 21. Wall Street analyst consensus is for significant earnings growth in 2013- the current-year P/E is only 16- and certainly Cohen, Levy, and their team have to be depending on an improved bottom line at the company. However, we would be wary of investing in a stock with that multiple unless it showed actual prospects of a turnaround.

See more funds that owed W.R. Grace and compare the company to its peers:

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 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

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

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!