Bruce Berkowitz

Bruce Berkowitz

Last Update: 2014-12-18
Related: Fairholme Fund
Fairholme Focused Income Fund

Number of Stocks: 24
Number of New Stocks: 3

Total Value: $7,263 Mil
Q/Q Turnover: 1%

Countries: USA
Details: Top Buys | Top Sales | Top Holdings  Embed:

Bruce Berkowitz Watch

  • Fairholme's Bruce Berkowitz and His Top 3 Holdings

    Bruce Berkowitz - Fairholme's Bruce Berkowitz And His Top 3 Holdings Popular value investor and guru Bruce Berkowitz (Trades, Portfolio) had a relatively busy quarter, adding three new stocks to his Fairholme Capital Management. The guru founded his Fairholme fund in 1997, and in 2009 he was named the Domestic-Stock Fund Manager of the Year and Domestic-Stock Fund Manager of the Decade by Morningstar. Berkowitz has had numerous successes over the past few years as well as his fair share of misses, and this past quarter was exemplified his expertise once again.

    As of the close of the third quarter Berkowitz held on to 24 stocks valued at over $7.2 billion. The guru added three new positions to his holdings: NYCB, BP and CHK – demonstrating a busy quarter for the relatively quiet guru. The following three stocks are his three largest holdings and where Berkowitz holds nearly 77% of his total assets managed.  


  • Bruce Berkowitz Buys 3 New Stocks in Q3

    Bruce Berkowitz - Bruce Berkowitz Buys 3 New Stocks In Q3

    Bruce Berkowitz (Trades, Portfolio)’s Fairholme Fund (Trades, Portfolio) (FAIRX) gained 8.72% in the first half of 2014, compared to 7.14% for the S&P. He has beat the index 499.01% versus 76.43% since inception in 1999.


    Berkowitz still has the majority of his fund invested in American International Group (AIG) and Bank of America (BAC). 

      


  • A Box Of Sweet Apples On Sale

    It was March 2013. The U.S. stock market was coming back strong from the great crisis, and the big bargains were disappearing as the market growth, but there was a big company that was definitely out of market favor and severely judged by investors, analysts and traders.


    It was a company that changed the world but seemed in trouble because of the death of the founder and the lack of a major innovation since then.

    I think you have already figured out the company name ... Apple (AAPL).

    In March 2013 I bought a bunch of shares of AAPL at ~440-450 $ / share ( ~64 $ / share split adjusted). The risk: I'm not a technology expert, and I know how fast technology can mutate. A technology company going out of favor could go from greatness to quite bankrupt (Nokia, BlackBerry docet)

    So ... was Apple the new BlackBerry?

    My view

    I'm not a technology expert, but I'm a curious guy who looks around trying to figure out what works and what doesn't. I found that Apple was different from any other PC/smartphone company. I found that Apple customers were and are different from other PC/smartphone company customers.

    The difference

    Looking around and talking with many Apple customers, I've found that Apple was more than a technology company. For the core of Apple customers, Apple is a strongly branded "lifestyle" status company .

    The core Apple customers are not going to buy a smartphone, are directly going to buy an iPhone; are not going to buy a PC, but a Mac. To me, in this sense, it looks quite similar to Ferrari, Rolex and Hermes.

    The core of Ferrari customers are simply going to buy a Ferrari , not a car , as the core of Hermes costumer are simply going to buy a birkin.

    With that personal strategic confidence and safety in mind, I have started to look at the financial side.

    Financial: cash is king

      


  • Bruce Berkowitz Discusses Managing Risk and Reward

    Bruce Berkowitz - Bruce Berkowitz Discusses Managing Risk And Reward

    Bruce Berkowitz (Trades, Portfolio) of Fairholmes Capital discusses managing risk and reward in a new video interview with institutional investors..


      


  • Bruce Berkowitz on Wealth Track

    Bruce Berkowitz - Bruce Berkowitz On Wealth Track A rare interview with Bruce Berkowitz (Trades, Portfolio) of The Fairholme Fund (Trades, Portfolio). Launched at the height of the tech bubble in late 1999, The Fairholme Fund (Trades, Portfolio) has been the top performer in Morningstar’s Large Value category since inception, delivering 13% annualized returns and beating its nearest competitor by a margin of 2.4% points a year. Berkowitz believes in “ignoring the crowd”. He’ll explain why nearly 80% of his portfolio is in four financial stocks shunned by most investors.  


  • The Ultimate Concentrated Value Investor - Bruce Berkowitz

    Since inception in 1999 the Fairholme Fund (Trades, Portfolio) managed by Bruce Berkowitz (Trades, Portfolio) is the single top performing mutual fund.


    But it hasn't been a smooth ride. Berkowitz is a concentrated investor (to say the least) and that brings volality.

      


  • Bruce Berkowitz’s Fairholme Buys 7 New Stocks

    Bruce Berkowitz - Bruce Berkowitz’s Fairholme Buys 7 New Stocks

    Bruce Berkowitz (Trades, Portfolio) led returns among gurus in the first quarter of the year with outsized holdings of enormous national home mortgage entities that almost fell during the financial crisis, Fannie Mae (FNMA) and Freddie Mac (EMCC).


    Berkowitz reiterated his faith in the investments in his second quarter letter, calling them maybe “the most important financial institutions in the United States – perhaps the world.”

      


  • Fannie, Freddie Western Ruling Immaterial

    Bruce Berkowitz - Fannie, Freddie Western Ruling Immaterial

    Currently the government is being sued by multiple hedge funds and Bruce Berkowitz (Trades, Portfolio)'s Fairholmes Funds over Fannie and Freddie. These investment firms are suing the government because the government acted illegally by getting Freddie and Fanni to pay the government nearly all of the firms' massive profits in the form of dividends. The investment funds alleged that both the Treasury and the FHFA violated the Administrative Procedure Act by exceeding their authority under the Bush-era Housing and Economic Recovery Act. They claim this voilation occurred in August 2012, when the Treasury and FHFA amended the peferred stock purchase agreement to implement a full income sweep under which Fannie and Freddie's profits will go to the Treasury. The plan in these lawsuits is to get a judge to rule that amending the preferred stock purchase agreement violates the Housing and Economic Recovery Act. A favorable ruling would lead to profits flowing to shareholders of preferred and common stocks held by these funds.


    Wall Street seems to believe a favorable rule for one lawsuit applies to another, but they don't. These cases have made Fannie and Freddie stocks and preferred shares trading on the over-the-counter market far more volatile as of late. Investing in Fannie and Freddie is a speculation that, if the investment funds win, the shares for these two companies will easily go up at least 10x, making Fannie and Freddie a Peter Lynch 10 bagger.

      


  • Bruce Berkowitz Comments on Sears Holdings Corp

    Sears (SHLD) remains the Fund’s least successful investment, yet has the highest potential based on our estimates of tangible values.

    From Bruce Berkowitz (Trades, Portfolio)'s Fairholme Fund Second Quarter 2014 Shareholder Letter.  


  • Bruce Berkowitz Comments on Bank of America

    Bank of America (BAC) common stock is the Fund’s third largest position. Acquiring and then fixing Countrywide Financial has cost the bank tens of billions. Finishing the task will, in our view, allow much more to drop to the bank’s bottom line.

    From Bruce Berkowitz (Trades, Portfolio)'s Fairholme Fund Second Quarter 2014 Shareholder Letter.  


  • Bruce Berkowitz Comments on Fannie Mae and Freddie Mac

    Fannie Mae (FNMA) and Freddie Mac (FMCC) preferred stocks and common shares constitute approximately 15% of the Fund’s portfolio. We believe that the two companies may be the most important financial institutions in the United States – perhaps the world – and directly support housing affordability and accessibility, including the uniquely American 30-year fixed-rate mortgage. They are a major reason why our country did not enter a second Great Depression, and are proving to be the most successful taxpayer investments of the Great Recession.

    From Bruce Berkowitz (Trades, Portfolio)'s Fairholme Fund Second Quarter 2014 Shareholder Letter.  


  • Bruce Berkowitz Comments on American International Group Inc

    AIG (AIG) common stock and warrants are nearly one-half the value of the Fund’s portfolio due to appreciation of these securities – even after realizing profits on the sale of millions of shares of AIG common stock.

    From Bruce Berkowitz (Trades, Portfolio)'s Fairholme Fund Second Quarter 2014 Shareholder Letter.  


  • Bruce Berkowitz's Fairholme Fund Second Quarter 2014 Shareholder Letter

    To the Shareholders and the Directors of The Fairholme Fund (Trades, Portfolio):


    The Fairholme Fund (Trades, Portfolio) (the “Fund” or “FAIRX” or “Fairholme”) gained 8.72% versus 7.14% for the S&P 500 Index (the “S&P 500”) for the six-month period that ended June 30, 2014. The following table compares the Fund’s unaudited performance (after expenses) with that of the S&P 500, with dividends and distributions reinvested, for various periods ending June 30, 2014.

      


  • Insisting on Being Clever

    Bruce Berkowitz - Insisting On Being Clever

    As I was driving home the other day and listening to Howard Marks (Trades, Portfolio)’ fantastic book “The Most Important Thing” on Audible, I heard a great line that I think is relevant to today’s environment:


    “It’s important to bear in mind that in addition to times when the errors are of commission (buying) and times when they are of omission (failing to buy), there are times when there’s no glaring error. When investor psychology is at an equilibrium, and fear and greed are balanced, asset prices are likely to be fair relative to value. In that case, there may be no compelling action – and it’s important to know that too. When there’s nothing particularly clever to do, the potential pitfall lies in insisting on being clever.”

      


  • Bruce Berkowitz Cuts Berkshire Stake in Half, Buys Vodafone and AT&T in Q1

    Bruce Berkowitz - Bruce Berkowitz Cuts Berkshire Stake In Half, Buys Vodafone And AT&T In Q1

    Bruce Berkowitz (Trades, Portfolio), a fund manager known for consistently correct prescient bets on undervalued assets, has recently piled his Fairholme Fund (Trades, Portfolio) high with shares of Fannie Mae and Freddie Mac, mortgage entities whose fates hang in a legislative balance. He has also been both a fan of Warren Buffett (Trades, Portfolio) and a holder of his company, Berkshire Hathaway (BRK.A)(BRK.B). But in the first quarter, he cut the holding, which had been his tenth largest, in half, and bought stocks of two additional companies: Vodafone Group PLC (VOD) and AT&T Inc. (T).


    Berkowitz started his Berkshire B-shares stake in 2009, when the price plunged to as low as an average of $59 per share. By the end of the year, he had accumulated 12,075,350 shares, of the company. He subsequently bought and sold more shares of the company, but he reduced the stake to its smallest yet in the first quarter. The investor cut 421,300 shares, or 59.32% of the holding, keeping just 288,935 shares, and relegating it to 0.36% of his portfolio.

      


  • Bruce Berkowitz Leads Returns for First Quarter with Bet on Fannie Mae, Freddie Mac

    Bruce Berkowitz - Bruce Berkowitz Leads Returns For First Quarter With Bet On Fannie Mae, Freddie Mac

    Bruce Berkowitz (Trades, Portfolio) still has almost 42% of his Fairholme Fund (Trades, Portfolio) (FAIRX) in American International Group Inc. (AIG), a holdover from his massive bet on U.S. financials post-economic crisis. As of year-end, he also holds massive stakes in his new venture, national home mortgage entities Fannie Mae (FNMA) (20 million common shares and 66 million preferred shares) and Freddie Mac (FMCC) (52 million preferred shares). The average gain of the new positions is the highest of all investors tracked by GuruFocus over the past six months, beating out those of Robert Karr (Trades, Portfolio), FPA Capital Fund (Trades, Portfolio) and Seth Klarman (Trades, Portfolio), who come after with him double-digit gains. In the past half-year, the Fairholme Fund (Trades, Portfolio)’s new positions have advanced 69.67%, while all of Bruce Berkowitz (Trades, Portfolio)’s new stocks went up 44.24%.


      


  • Bruce Berkowitz - There Is No Debate, Fannie and Freddie Are Private

    Bruce Berkowitz - Bruce Berkowitz - There Is No Debate, Fannie And Freddie Are Private

    Bruce Berkowitz (Trades, Portfolio) has a big position in Freddie and Fannie preferred shares.


    Over the past nine months he has done very well with that position.

      


  • Bruce Berkowitz’s Only New Stock - A Miner

    Bruce Berkowitz - Bruce Berkowitz’s Only New Stock - A Miner

    Yet again this quarter, Bruce Berkowitz (Trades, Portfolio) acquired an array of types of embattled Fannie Mae (FNMA) and Freddie Mac (FMCC) stock, as congress works out the fates of the two mortgage entities, and decides what investors will receive. Being so deep into this bet, Berkowitz has shown little interest in U.S. corporate stocks, where he formerly concentrated. He did, however, buy shares of one new company in the fourth quarter: Imperial Metals Corp. (TSX:III).


    Berkowitz’s new position is sized at 2,705,300 shares, making up 0.44% of the Fairholme Fund portfolio, and valued around $36.3 million. The company’s shares cost around $14 on average during the quarter.

      


  • Bruce Berkowitz Comments on Fannie Mae and Freddie Mac

    Two of our best performers during the period were Fannie Mae (FNMA) and Freddie Mac. Both are absolutely essential for uniquely- a merican, affordable mortgages. If you disagree, try getting a 30-year, sub-5% mortgage outside of the United States. In 2008, both companies agreed to U.S. conservatorship and extraordinarily harsh terms and conditions during a time of global crisis. The plan worked. Fannie and Freddie saved the day, repaid nearly every penny of cash received from the u . s . Treasury, and can look forward to resuming a prosperous future based just on the aging of assets held. However, many believe Fannie and Freddie will be victims of a government-sponsored expropriation that brings our country closer to a future conceived by George Orwell in his novel, 1984 . We disagree

      


  • Bruce Berkowitz Comments on Sears Holdings

    Headlines shout of Sears (SHLD)' disastrous 2013 loss of $12 per share. A longer history shows that since the merger of Sears with Kmart, about 9 years ago, s ears has distributed over $66 of cash per share via buybacks and spin-offs and has paid down $27 per share of a pension liability that is no different, in our view, from debt. Fairholme research estimates that the fair value of s ears' net assets exceeds $150 per share. If our research is accurate, we expect s ears' market price of $38 to increase to this value over time.

      


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User Comments

Mocheng
ReplyMocheng - 2 months ago
On the homepage, it said Bruce added more SHLD, but it's not showing when I clicked to view details, is there anyway to find out how many shares he added?
Gurufocus
ReplyGurufocus - 1 year ago
"where's the fannie and freddie?"

They are in the portfolio of Fairholme Fund:

http://www.gurufocus.com/holdings.php?GuruName=Fairholme+Fund
A632784
ReplyA632784 - 1 year ago
where's the fannie and freddie??????????????????
Gegogego
ReplyGegogego - 1 year ago
Why are Freddie Mac and Fannie Mae not listed in current holdings or recent buys?



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