Related ticker: Research In Motion Ltd (NASDAQ:BBRY)
Every quarter, many money managers have to disclose what they’ve bought and sold, via “13F” filings. Their latest moves can shine a bright light on smart stock picks.
Today, let’s look at investing giant Donald Yacktman, who founded Yacktman Asset Management in 1992. He isn’t as well-known as investors such as Buffett, Soros, Berkowitz, and the like, but his track record is right up there with them. Yacktman is a value investor, aiming to achieve the highest possible risk-adjusted long-term return on his investments. The company’s flagship Yacktman Fund gained 704% since its 1992 inception (as of the end of March, 2013), compared with 473% for the S&P 500 during the same period. (Annualized, that’s 10.6% vs. 8.8%.
The company’s reportable stock portfolio totaled $19.5 billion in value as of March 31, 2013.
So what does Yacktman’s latest quarterly 13F filing tell us? Here are a few interesting details:
The biggest new holding is specialty chemical company Sigma-Aldrich Corporation (NASDAQ:SIAL), which recently hit a 52-week high, and also upped its dividend by 7.5%. The company has been growing at a modest rate, but generating substantial free cash flow. Its fortunes are tied to R&D spending at biotech and pharmaceutical companies that buy its offerings, and management is optimistic about emerging markets’ growing interest in life-sciences research, too.
Image below: Research In Motion Ltd (NASDAQ:BBRY) Q10
Among holdings in which Yacktman Asset Management increased its stake was freight and shipping specialist C.H. Robinson Worldwide, Inc. (NASDAQ:CHRW). In the company’s recently reported first quarter, revenue surged 17%, but earnings per share shrank a bit. The biggest gain came from ocean shipping, where revenue rose 170%. In discussing results and the trucking market, management described a very fragmented marketplace, with thousands of small competitors. It also pointed out the company’s relatively solid performance in recent difficult years.
Yacktman Asset Management reduced its stake in companies such as The Western Union Company (NYSE:WU) and Research In Motion Ltd (NASDAQ:BBRY). Western Union has been threatened by the new options people have for transferring money, such as eBay Inc (NASDAQ:EBAY)‘s PayPal service. It recently reported shrinking quarterly revenue and earnings, but continues to generate gobs of cash. It has been a solid dividend payer with that money, more than doubling its payout over the past three years, and has also been buying back shares.
Research In Motion Ltd (NASDAQ:BBRY) has been struggling for years now, competing with iDevices and Android smartphones. Many have written it off, worried about factors such as production cuts, but others see rays of hope in emerging market sales, and its upcoming inexpensive smartphones. Most agree that the stock is risky, but some still view it as intriguingly priced.