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Locust Wood Capital Advisers’ Return, AUM, and Holdings (Part II)

Read the beginning of this article here.

The most valuable position in Locust Wood Capital Adviser’s 13F portfolio at the end of March 2019, was in Linde plc (NYSE:LIN). This is one of the biggest industrial gas companies by market share and revenue in the world. For 2018 it reported pro forma sales of $28 billion. With around 80,000 employees, the company is providing its professional services across 100 countries around the world. It was formed by the merger of German’s Linde AG and the US’ Praxair. In its last financial report for the first quarter of 2019, Linde disclosed sales of $6.94 billion and diluted earnings per share from continuing operations of $0.79, compared to sales of $2.98 billion and diluted earnings per share from continuing operations of $1.59 in the same quarter of 2018. Year-to-date, its stock gained 29.78%, and on June 18th it had a closing price of $204.02. On June 7th, JPMorgan Chase & Co. boosted its price target on it to $206.00 from $189.00 with ‘Overweight’ rating. During Q1 209, Locust Wood actually lowered its stake in the company by 15% to 597,647 shares, with a value of 89.31 million amassing 6.97% of its portfolio.

The second largest stake the fund held at the end of the quarter was in Comcast Corporation (NASDAQ:CMCSA), a Philadelphia-based telecommunications conglomerate, which is also the largest high-speed internet, video, and phone provider in the US. Its three largest businesses are Comcast Cable, NBC Universal, and Sky. Over the last 12 months, the company’s stock gained 27.92%, having a closing price on June 18th of $43.25. Its market cap is of $196.30 billion, and the company is trading at a price-to-earnings ratio of 16.39. For Q1 2019, Comcast Corporation disclosed revenue of $26.9 billion versus $22.79 billion one quarter earlier, and earnings per share of $0.77, compared to EPS of $0.66 for the last quarter of 2018. On June 14th, Raymond James downgraded its rating on the stock to ‘Outperform’ from ‘Strong-Buy’ and lowered its price target on it to $21.00 from $25.00, while Rosenblatt Securities initiated coverage and placed ‘Buy’ rating with a price target of $50.00 on it. Locust Wood had 1.94 million Comcast’s shares with a value of $77.36 million at the end of March 2019.

Microsoft Corporation (NASDAQ:MSFT), represented the fund’s third most valuable holding at the end of the first quarter, with 575,511 shares outstanding that were worth $67.88 million. This position accounted for 5.3% of its 13F portfolio. Since the beginning of the year, Microsoft’s stock gained 33.66% and on June 18th it closed with a price of $135.16.

Out of six new additions to the fund’s portfolio, the biggest one was Element Solutions Inc (NYSE:ESI), a chemical company with a market cap of $2.68 billion that offers various original solutions covering many markets. It has a market cap of $2.68 billion. Locust Wood initiated a position that was worth $28.73 million, on the account of 2.84 million shares, comprising 2.24% of its portfolio. Over the past 12 months, Element’s stock lost 11.34%, closing on June 18th, with a price of $10.40. As per its financial report for the first quarter of 2019, the company had net sales of $459.8 million and diluted EPS of $0.09, compared to net sales of $492.5 million and diluted EPS of $0.13 in the same period of 2018.

The second in line of valuable new positions was The Boeing Company (NYSE:BA), a world-famous airplane manufacturer that also makes satellites, rockets, missiles, and other aircraft-related products.  Its stock gained 15.49% since the beginning of the year, and on June 18th it had a closing price of $373.96. Locust Wood purchased 68,305 Boeing’s shares valued $26.05 million creating a stake that accounted for 2.03% of its equity portfolio. The Boeing Company has a market cap of $210.20 billion, and it is trading at a P/E ratio of 21.41. For Q1 2019, the company reported revenues of $22.92 billion and GAAP EPS of $3.75, compared to revenues of $23.38 billion and GAAP EPS of $4.15 in the same period of 2018. On June 14th, Goldman Sachs Group restated its ‘Neutral’ rating on the stock with a price target of $396.00, while one day earlier Berenberg Bank repeated its ‘Buy’ rating on it, with a price target of $415.00.

In Baxter International Inc. (NYSE:BAX), a Fortune 500 health care company Locust Wood established $16.96 million worth a position by acquiring 208,625 shares. YTD, its stock is up 23.37% and on June 18th it closed with $80.56 per share.

Disclosure: None

This article was originally published at Insider Monkey.

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