Bernard Horn

Bernard Horn Premium Guru

Last Update: 11-17-2015

Number of Stocks: 90
Number of New Stocks: 0

Total Value: $305 Mil
Q/Q Turnover: 9%

Countries: USA ITA NOR GBR BEL FIN HKG DEU KOR FRA SWE CHE JPN CAN THA AUS
Details: Top Buys | Top Sales | Top Holdings  Embed:

Bernard Horn Watch

  • Bernard Horn's Polaris Global Value Fund 4th Quarter Letter

    Dear Fellow Shareholder,


    January 7, 2016 The Polaris Global Value Fund (“the Fund”) underperformed the MSCI World Index, net benchmark in the quarter, at 4.99%, while the Index was 5.50%. Although slightly lagging the benchmark, the Fund achieved strong absolute performance and positive returns in all 10 sectors. Performance contribution was widely dispersed throughout sectors, with most notable results from consumer staples, financials and information technology.

      


  • Bernard Horn Adds to Existing Stakes in 3rd Quarter

    As is often the case, Bernard Horn (Trades, Portfolio) of Polaris Global Value Fund added to many of his existing stakes in the third quarter. What was unusual was that nearly all of his transactions were additions.


    Horn’s most significant third-quarter addition was his purchase of 42,400 shares of Wincor Nixdorf AG (XTER:WIN), a German information technology company, for an average price of €37.07 (about $39.38 in U.S. currency) per share. The deal had a 0.55% impact on Horn’s portfolio.

      


  • Bernard Horn Comments on Solvay SA

    Early in the year, global urea prices fell to multi - year lows below $260 a ton, and China continued a torrid pace of urea exports. Although Solvay SA (XBRU:SOLB) reported admirable second quarter earnings and margin improvement, the stock dropped based on weak results in the company’s Novecare business line. Three of Solvay’s four main business lines executed well for the quarter with increased sales and volumes, yet all focus surrounded Novecare. The contraction in the U.S. oil and gas industry supply chain dampened Novecare’s sales. Demand diminished for stimulation, drilling and cementing activities. In a case of inopportune timing, Solvay announced just prior to the earnings release that it had recently built a state-of-the-art oil and gas lab in Singapore intended to internationalize Novecare’s business.

    From Bernard Horn (Trades, Portfolio)'s third quarter 2015 shareholder letter.   


  • Bernard Horn Comments on Duni AB

    Duni AB (OSTO:DUNI), a Swedish supplier of paper goods and table settings, was up on earnings news. The company noted increasing net sales for the 3- and 6-month periods ending June 2015, as well as decreased net debt. Duni AB shuttered the hygiene production business, and reinvested capital to upgrade paper machines for increased capacity. The on-going initiatives contributed to better profitability of operations. Homebuilders experienced consistent sales progress in a more favorable regulatory environment than we have seen in years, which allowed the stocks to hold up in a volatile market.

    From Bernard Horn (Trades, Portfolio)'s third quarter 2015 shareholder letter.   


  • Bernard Horn Comments on Deutsche Telekom

    Deutsche Telekom (XTER:DTE)’s stock price ticked up, after reporting double-digit growth for the second quarter of 2015. Net revenues rose by more than 15% and free cash flow improved to nearly $1.6 billion. Deutsche Telekom’s retail broadband customers increased in Germany and subsidiary T-Mobile U.S. continued to outpace peers in capturing new subscribers.

    From Bernard Horn (Trades, Portfolio)'s third quarter 2015 shareholder letter.   


  • Bernard Horn Comments on Infosys Ltd.

    Information technology company Infosys, Ltd. (NYSE:INFY) was among the top contributors for the quarter, as it announced stellar quarterly results and notable growth rates. Issues that previously plagued Infosys, Ltd. dissipated. Attrition declined due to targeted measures by management to provide employees with better training and salaries. Legal battles over the visa program concluded, with no findings of misuse by Infosys, Ltd. The stock price responded, up approximately 20% during the quarter.

    From Bernard Horn (Trades, Portfolio)'s third quarter 2015 shareholder letter.   


  • Bernard Horn Comments on Guangdong Investment Ltd.

    Hong Kong water utility Guangdong Investment, Ltd. (HKSE:00270) intends to deploy capital to acquire further earning assets from its parent company, including toll roads and water treatment facilities. Investors were excited about the prospects for the water treatment plant, which is a burgeoning theme in water-constrained China.

    From Bernard Horn (Trades, Portfolio)'s third quarter 2015 shareholder letter.   


  • Bernard Horn's Polaris Global Value Fund Q3 Letter

    The Polaris Global Value Fund (“the Fund”) underperformed the MSCI World Index, net benchmark in the quarter, at -8.80%, while the Index dropped -8.45%. The quarter was marked by volatility in commodity prices, which had a negative short-term effect on some materials and energy companies. Ultimately, we believe lower oil prices will have a positive effect on consumer purchasing power worldwide; however, we must first weather this current spate of volatility.


    A number of U.S. financials, including The Chubb Corp., Astoria Financial Corp., Ameris Bancorp and BNC Bancorp contributed positively to the Fund’s performance. Banks were buoyed by the expected Federal Reserve rate hike in September. The Fed’s decision to postpone the increase left banks lower at the end of the quarter. India’s IT company, Infosys, Ltd., had double digit gains after announcing impressive quarterly results and projected growth that triggered revised upward guidance. A more recent portfolio addition, Kia Motors Corp., benefited from new car model launches and top safety ratings from J.D. Powers and Associates. These gains could not offset losses elsewhere in the portfolio, including energy stocks WorleyParsons, Ltd., Marathon Oil Corp. and Maurel et Prom. Perennial outperformer, Canada’s Methanex Corp., saw methanol prices drop more than 30% due to lower commodity prices. Lower prices of coal used to produce methanol in China also impacted the stock. One of the Fund’s largest holdings, Greencore Group, was down modestly this quarter due to labor cost pressures in the U.K. and one-off start-up charges for its U.S. facilities.

      


  • Bernard Horn Sells Stake in Japanese Confectionary Company

    Bernard Horn (Trades, Portfolio)’s Polaris Global Value Fund looks for undervalued stocks in which to invest. The Fund has been pretty good at it, too, producing returns of nearly 37% in 2013 and 21% the year before.


    Horn’s most noteworthy transaction of the second quarter was his sale of his 49,916-share stake in Meiji Holdings Co. Ltd. (TSE:2269), a Tokyo-based confectionary company, for an average price of ¥123.67 (about $1.03 in U.S. currency) per share. The sale had a -2.08% impact on Horn’s portfolio.

      


  • Bernard Horn Comments on Marathon Petroleum

    One bright spot was Marathon Petroleum (MPC). The company differentiates itself from competitors with a business model that focuses on domestic refining and gas station franchises. Refining margins are up and refiners, like Marathon Petroleum, are increasing throughput ahead of expected additions to production in 2015. In the past year, Marathon Petroleum’s division Speedway acquired Hess, expanding its retail station presence from nine to 23 states throughout the East Coast and Southeast. Recent lower gas prices may spur on more travel and subsequently more stops at gas stations.

    From Bernard Horn (Trades, Portfolio)’s Polaris Global Value Fund Q4 2014 Shareholder Letter.  


  • Bernard Horn Comments on Linde AG

    Linde (XTER:LIN) is a German multi national industrial gases and engineering company. The company appears attractive, as it is a dominant player in a consolidated industry, with low downside risk, many long-term contracts and strong visible cash flows.

    From Bernard Horn (Trades, Portfolio)’s Polaris Global Value Fund Q4 2014 Shareholder Letter.  


  • Bernard Horn Comments on Methanex

    By contrast, Methanex (MEOH) has been hampered by natural gas supply constraints, causing reduced production at one Trinidad plant and restricted activity in Chile and Egypt. Lower commodity prices have also been at issue, both with methanol at Methanex and iron ore and oil at Australia’s BHP Billiton.

    From Bernard Horn (Trades, Portfolio)’s Polaris Global Value Fund Q4 2014 Shareholder Letter.  


  • Bernard Horn Comments on Deutsche Telekom

    Deutsche Telekom (XTER:DTE)’s stock price was up on news of merger & acquisition transactions, including BT Group’s potential purchase of British wireless venture EE, currently owned by DT and Orange S.A. DT’s T-Mobile remained an attractive asset for potential suitors, with Dish Network Corp. expressing interest. T-Mobile gained the most subscribers in the U.S. for 2014, although it is still struggling to turn a profit.

    From Bernard Horn (Trades, Portfolio)’s Polaris Global Value Fund Q4 2014 Shareholder Letter.  


  • Bernard Horn Comments on Trevi Finanziaria Industriale

    Italian ground engineering firm Trevi (MIL:TFI) continued its downward trajectory. We believe that the company’s stock depreciation is overdone. The company conducted a capital raise in the second half of 2014 to expand its oil drilling business. While lower oil prices may cause less drilling in certain locations, Trevi has yet to have any order cancellations. Company management recently announced all- time high order books for oil drilling and improved financial metrics for the nine months ended September 2014.

    From Bernard Horn (Trades, Portfolio)’s Polaris Global Value Fund Q4 2014 Shareholder Letter.  


  • Bernard Horn Comments on Kone OYJ

    Finnish elevator/escalator manufacturer Kone OYJ (OHEL:KNEBV) was the top industry contributor, with double-digit gains after generating healthy results and order intakes. With an established foothold in China, Kone is expected to capitalize on relaxed Chinese real estate policies and the announcement of another 7 million affordable housing units.

    From Bernard Horn (Trades, Portfolio)’s Polaris Global Value Fund Q4 2014 Shareholder Letter.  


  • Bernard Horn Comments on Allete

    Allete (ALE)’s third quarter earnings were up, due to cost recovery revenue related to wind energy expansion and retrofit of an electric unit. In addition to capital expenditure projects coming to fruition, the company announced strong demand from its important industrial customers in the region.

    From Bernard Horn (Trades, Portfolio)’s Polaris Global Value Fund Q4 2014 Shareholder Letter.  


  • Bernard Horn Comments on Samsung Electronics

    At Samsung Electronics (XKRX:005930), Lee Jae Yong has taken the reins of the company since his father’s hospitalization. During his short tenure, he has already proposed a $2 billion buyback and disposed of stakes in chemicals and defense businesses. The market is optimistic that such restructuring will also lead to better corporate governance and a renewed focus on core markets, including consumer televisions, smartphones and smart home software. We look to new cell phone models from Samsung’s research & development labs to lead its low-cost competitors.

    From Bernard Horn (Trades, Portfolio)’s Polaris Global Value Fund Q4 2014 Shareholder Letter.  


  • Bernard Horn Comments on Hewlett-Packard Co

    Hewlett-Packard Co. (HPQ) was the sector’s top performer, after announcing plans to split into two publicly traded companies: one that will focus on enterprise technology, storage, service and cloud platforms and one that will focus on consumer-driven products and printers.

    From Bernard Horn (Trades, Portfolio)’s Polaris Global Value Fund Q4 2014 Shareholder Letter.  


  • Bernard Horn Comments on Sparebank 1 SR & DNB ASA

    Norwegian banks, Sparebank 1 SR (OSL:SRBANK) and DNB Bank ASA (OSL:DNB), declined on oil-related concerns, although neither institution holds more than 10% of loan books in direct oil- and gas-related businesses. We believe that the stock price drops are more magnified than warranted. Although Norway is an oil-producing country, it has a very different structure for oil proceeds. In most OPEC countries, oil is the only resource and money from oil revenues is spent on current government programs. In Norway, oil revenues collected by the government are sequestered in an oil fund, which is explicitly banned from use to bolster the domestic economy. In our opinion, the Norwegian economy is fairly insulated by declines in oil prices, but might be affected at the margins.

    From Bernard Horn (Trades, Portfolio)’s Polaris Global Value Fund Q4 2014 Shareholder Letter.  


  • Bernard Horn Comments on MEIJI Holdings Co Ltd

    In Japan, MEIJI Holdings Co Ltd. (TSE:2269) reported healthier margins and rising profitability. The integration of the 2009 merger of its dairy and pharmaceutical divisions is finally achieving better results. The company has successfully reorganized the business, implemented structural reforms and increased overseas operations. With an aging population eating more probiotics, MEIJI’s dairy division more than offset Japanese drug price cuts impacting the pharmaceutical division. We expect that the decrease in oil prices will have a beneficial effect on disposable income, leading to further consumer demand in Japan, and in all non-oil producing countries.

    From Bernard Horn (Trades, Portfolio)’s Polaris Global Value Fund Q4 2014 Shareholder Letter.  


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