Considering another abysmal performance in the form of a 5.53% decline year-to-date in its second-largest holding, BlackBerry Ltd (NASDAQ:BBRY), Watsa’s belief in value investing is possibly being put to the test, at least as far as his top picks are concerned. After acquiring an additional 45,000 shares, the holding company held nearly 46.70 million shares of BlackBerry Ltd (NASDAQ:BBRY) valued at $416.51 million. The stake represented nearly 30% of the fund’s portfolio value. BlackBerry Ltd (NASDAQ:BBRY) has been in Fairfax’s portfolio since the third quarter of 2010. The Waterloo-based company’s CEO John Chen, who took the reins in November 2013 has been trying to steer Blackberry back to its past position of prominence, but with a different business model. The company is charging in on the Internet of Things (IoT)’ space, with a focus on security. It was recently announced that BlackBerry Ltd (NASDAQ:BBRY)’s subsidiary, Certicom, won a contract to use its security certificates in about 104 million smart meters and energy management devices in the U.K. The IoT security space is largely untapped according to a report by Hewlett-Packard, which claims that 80% of IoT home devices have serious security flaws. Just this week, Cowen raised the price target of BlackBerry Ltd (NASDAQ:BBRY) to $11 from $10, while keeping its ‘Market Perform’ rating. D E Shaw, founded by David Shaw is the second largest shareholder of BlackBerry Ltd (NASDAQ:BBRY) among the funds we track, with some 5.59 million shares.
Fairfax’s holding in International Business Machines Corp. (NYSE:IBM) doesn’t exactly paint a rosy picture either. The stock hit its 52-week low this year, but has rebounded since then and is up by nearly 8% year-to-date. Despite first quarter revenues of $19.59 billion missing the estimates by $140 million and derspite registering a drop in revenue for the 12th consecutive quarter, International Business Machines Corp. (NYSE:IBM)’s $2.91 EPS for the quarter was $0.09 ahead of expectations. Ginni Rometty, IBM’s CEO noted that excluding the foreign exchange headwinds and losses from business segments that the company has or plans to divest, the revenues were actually flat. Warren Buffett is very hopeful of the eventual recovery of International Business Machines Corp. (NYSE:IBM) and has only continued to increase the stake his holding company, Berkshire Hathaway, has in IBM during the slump in its stock price. Recently the company also partnered with Apple and Japan Post Group to deliver iPads with IBM-developed apps to Japanese senior citizens in order to better connect them with services, healthcare, and the community.
Disclosure: None
