Mario Gabelli Initiates 8% Stake in Zale Corporation (ZLC)

Mario Gabelli has set his sights on Zale Corporation (NYSE:ZLC). In a recent filing with the Securities and Exchange Commission, GAMCO Investors, Gabelli Funds, and GSI have disclosed opening a new position by acquiring an aggregate of 2.7 million shares. This stake accounts for approximately 8.1% of the company’s common stock.

Mario Gabelli

Zale Corporation (NYSE:ZLC) has also attracted the attention of Guru Ramakrishnan. During the last quarter of 2013, his fund, Meru Capital, has acquired 557,700 shares reportedly worth $8.79 million. Israel Englander is also bullish on this stock, having increased his stake by 143%. According to its latest 13F report, Millennium Management holds 375,300 shares valued at $5.9 million. Jim Simons of Renaissance Technologies has, on the other hand, reduced his exposure to Zale Corporation. Renaissance has almost halved its stake to 341,692 shares reportedly worth $5.4 million.

Zale Corporation (NYSE:ZLC) is a retailer of jewelry that operates in North America. Following a massive depreciation in the aftermath of the 2008 financial crisis, the stock has been steadily advancing to a current price of $21.71, up by 2339% since the 2009 low of $0.89 per share. The company has a market cap of $713 million and does not pay a dividend. For the quarter ended January 31, 2014, Zale posted revenues of $656 million, down from $671 million in the same period last year, and earnings of $1.13 per share, a 10% year-over-year increase. Analysts expect the company to register revenues of $441 million and earnings of $0.17 for the current quarter.

Gabelli has managed to beat the S&P500 index by approximately 2% since its inception and is a renowned investor, with a portfolio worth more than $18 billion. According to the fund’s latest 13F report, the biggest position in its portfolio is held by DIRECTV (NASDAQ:DTV). in which Gamco owns 4.5 million shares valued at $313 million.

Disclosure: none

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