Jonathan Bloomberg‘s value-investment-oriented firm BloombergSen recently filed its Form 13F for the reporting period of June 30 with the SEC. At the end of the second quarter more than 50% of the fund’s equity portfolio was comprised of companies operating in the finance sector. Over the last 12 months the sector is down by over 11% on average, and has been particularly hard-hit in 2016, which means that there could be a number of good value plays in the sector for patient investors. With that in mind, we decided to dig a little deeper into BloombergSen’s top financial picks heading into the third quarter to see which stocks the financial sector-biased firm is betting most heavily on.
We track prominent investors and hedge funds because our research has shown that historically their stock picks delivered superior risk-adjusted returns. This is especially true in the small-cap space. The 15 most popular small-cap stocks among a select group of investors delivered a monthly alpha of 80 basis points between 1999 and 2012 (see the details here).
Pra Group Inc (NASDAQ:PRAA)
– Shares Owned by BloombergSen (as of June 30): 1.95 Million
– Value of Holding (as of June 30): $47.04 Million
After a 1% increase during the April-to-June period, BloombergSen’s Pra Group Inc (NASDAQ:PRAA) holding represented 4.96% of the value of the firm’s equity portfolio. Shares of the $1.3 billion company that is in the business of acquiring and collecting nonperforming loans is down by about 19.7% so far this year. Early last month Pra Group Inc (NASDAQ:PRAA) acquired e-Gov Systems, which provides web-based payment portals and integrated revenue administration solutions to the government sector and processes more than $1.2 million in online transactions every year. Sanford J. Cohen‘s Apex Capital is also bullish on Pra Group Inc (NASDAQ:PRAA), having held about 232,700 shares of the company at the end of March.
Aon plc Class A Ordinary Shares (UK) (NYSE:AON)
– Shares Owned by BloombergSen (as of June 30): 535,905
– Value of Holding (as of June 30): $58.54 Million
BloombergSen’s new position in Aon plc Class A Ordinary Shares (UK) (NYSE:AON) represented 6.17% of its equity portfolio’s value on June 30. Even though the company’s second quarter revenue of $2.77 billion was $90 million lower than estimates, the provider of insurance brokerage, risk management, and human capital consulting services is still up by a hefty 16.2% so far this year. Moreover, Starbucks Corporation (NASDAQ:SBUX) also recently announced that it has joined Aon’s innovative active health exchange platform. LMR Partners, which is managed by Ben Levine, Andrew Manuel and Stefan Renold also initiated a position in Aon plc Class A Ordinary Shares (UK) (NYSE:AON) during the second quarter, of some 7,100 shares.
We’ll check out BloombergSen’s favorite stock and its top two finance stock picks on the next page.