Mario Gabelli, GAMCO Investors’ Biggest Equity Portfolio Moves During the First Quarter

Mario Gabelli‘s GAMCO Investors is one of the most prominent funds in the investment universe, which is why we consider that its activity should be followed closely, especially by piggy-backers who try to mimic the activity of notorious investors. GAMCO reported an impressive performance for the last year, showing a revenue worth $344.3 million, versus $397.6 million reported a year earlier. Moreover, its EPS surged by an impressive 60% on the year to $4.54 per share, while the total value of Assets Under Management reached a record $47 billion, as the fund states in a press release.

Mario Gabelli

However, what is more interesting for us, is the stocks in which Mario Gabelli is investing. With this in mind we have taken a look at GAMCO’s latest 13F filing with the SEC, in which the fund released all its equity positions as at the end of the first quarter of the year. The value of the equity portfolio has been slightly reduced around $18.5 billion, and GAMCO’s top positions remained basically unchanged, the top three being represented by DIRECTV (NASDAQ:DTV), American Express Company (NYSE:AXP), and Viacom, Inc. (NASDAQ:VIAB), in which, however, Mr. Gabelli, has reduced his fund’s holdings. In this piece we will further discuss some of the interesting moves made by Gabelli during the first quarter.

As it was mentioned above, the largest holding in terms of value is represented by DIRECTV (NASDAQ:DTV), of which GAMCO owns around 4.2 million shares, down by 402,700 shares over the quarter, with an aggregate value of $316 million. On the second and third place are American Express Company (NYSE:AXP) and Viacom, Inc. (NASDAQ:VIAB), in which the fund revealed $295.3 million and $291.7 million stakes, with some 3.3 million and 3.4 million shares respectively.

At the same time, GAMCO has surged its position in BEAM Inc (NYSE:BEAM), of which it held over 3.2 million shares, up by more than 20% on the quarter, with a value of $270.1 million. However, a couple of days ago, BEAM has been acquired by Suntory Holdings Limited, which offered to pay $83.50 per share (according to the 13F, in the GAMCO’s equity portfolio, one share of Beam is valued at around $83.3 apiece).

Mr. Gabelli has also added around 50 new positions to the equity portfolio. An interesting thing is that most of these positions are represented by companies that have either been acquired, or are in the process of merger with other companies. The largest new holding is a $22.9 million stake in Forest Laboratories, Inc. (NYSE:FRX), which amasses 247,700 shares. The position can be considered as a ‘hit’ taking into account that the stock of Forest gained over 50% since the beginning of the year, mainly on the back of the announcement about Actavis plc (NYSE:ACT)’s plans to acquire the company in a deal worth around $25 billion in cash and equity. Mr. Gabelli also holds a small stake in Actavis, which contains around 31,400 shares. Other two new holdings: ATMI Inc (NASDAQ:ATMI) and Zale Corporation (NYSE:ZLC) have also been purchased recently.

Now, let’s take a look at the companies which Mr. Gabelli has reduced his exposure. One of the most important is Mastercard Inc (NYSE:MA), of which, GAMCO has sold almost 2.0 million shares, reducing the position to around 216,800 shares. The stock of Mastercard has declined by around 10% since the beginning of the year, and trails a P/E of around 27.00, which is above the industry average, but is below some of its peers in the industry, like Visa Inc (NYSE:V), whose stock also declined, but sports a P/E of over 127.00. Natixis Global Asset Management‘s Harris Associates also holds a stake in Mastercard, which contains close to 2.1 million shares, as of the end of last year.

Another holding, in which GAMCO has reduced its stake, is Liberty Interactive (Interactive group) (NASDAQ:LINTA), of which GAMCO disclosed holding around 1.21 million shares, down by some 50% on the quarter. The stock of Liberty Media, however, surged at the beginning of April, its year-to-date return amounting to over 97%. Brahman Capital, led by  Peter Adam Hochfelder, owned some 7.4 million shares of Liberty Interactive at the end of December 2013, followed by Murray Stahl‘s Horizon Asset Management, with 7.3 million shares.

Disclosure: none

Recommended Reading:

Telephone & Data Systems, Inc. (TDS) And Two Other Moves From Mario Gabelli and GAMCO Investors

Mario Gabelli and GAMCO Up Stake in Griffon Corporation (GFF)

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