John Keeley

John Keeley

Last Update: 05-13-2016

Number of Stocks: 311
Number of New Stocks: 45

Total Value: $2,622 Mil
Q/Q Turnover: 9%

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

John Keeley Watch

  • Keeley Funds Comments on Lincoln National Corporation

    Another financial holding, Lincoln National Corporation (NYSE:LNC), declined over 20% as falling interest rates dimmed its earnings outlook. In addition, the Department of Labor’s new fiduciary rule could negatively impact annuity sales, an important source of business for Lincoln National. Despite these challenges the stock appears cheap and we believe it will be able to blunt the negative impact more than investors anticipate.

      


  • Keeley Funds Comments on CIT Group

    The largest detractor this quarter was CIT Group (NYSE:CIT), a bank which has several specialty lending and leasing platforms in addition to its West Coast branch presence. CIT fell more than 20% in the quarter as earnings expectations fell. Falling interest rates and less accretion from its large OneWest acquisition have diminished forward expectations. We stayed the course as the stock is very cheap and we believe the company’s plans to pull out costs will improve returns and ultimately earnings and share price.

      


  • Keeley Funds Comments on Air Lease Corporation

    We had a similar experience with Air Lease Corporation (NYSE:AL), a leading commercial aircraft lessor. The stock fell early in the quarter on concerns about its exposure to airlines in emerging markets. It fell more than 30% within the quarter, but finished down only 4%. Considering the strong order and leasing book along with global air traffic on the rise, we believe Air Lease’s best days are still ahead.

      


  • Keeley Funds Comments on Huntsman Corporation

    Perhaps the only benefit of volatility for investors is that it sometimes gives you the opportunity to buy stocks at unusually attractive prices. In the first quarter, we took advantage of a nearly 30% intra-quarter decline in the price of Huntsman Corporation (NYSE:HUN) to add the stock to the portfolio. Huntsman is a specialty chemical company that is also a supplier of commodity titanium dioxide (TiO2). Losses in TiO2 obscured the value of the core business. The stock managed to nearly recover its year-end price driving a strong gain for the Fund’s holdings.

      


  • Keeley Funds Comments on Iron Mountain

    The top contributor in the quarter was Iron Mountain (NYSE:IRM), a REIT that provides paper and digital records storage and services. IRM appreciated 25% during the quarter in part on the strength in REITs and in part due to its progress in gaining antitrust approval for its acquisition of global rival Recall Holdings. The deal was approved after the quarter ended.

      


  • KEELEY Mid Cap Dividend Value Fund First Quarter Commentary

    In the first calendar quarter of 2016, the KEELEY Mid Cap Dividend Value Fund (KMDVX) increased 3.57% compared to a 3.92% rise for the Russell Midcap Value Index. The year began under a rather ominous cloud in January as U.S. equity markets faced tremendous headwinds. The S&P 500 Index, which dropped by 9% from the end of last year through January 21, recorded its worst start to a year in the history of the Index. Fortunately, the environment quickly reversed course following the European Central Bank’s announcement to expand its stimulus efforts against low inflation. In addition, the Bank of Japan’s surprise interest rate cut (to negative territory), helped turn around the declines seen early this year. In the U.S., market participants scaled back their expectations for the number of interest rate hikes this year as the Fed observed tepid GDP growth, low inflation, and unemployment hovering around 5%. Further, as China entered a potentially lengthy low-growth phase, eyes focused on the U.S. as a global growth leader.


    U.S. equity markets strengthened during February and March, closing the quarter in positive territory. However, there was wide dispersion among the various sectors during the quarter. Within the Russell Midcap Value Index, sector performance ranged from -6.0% (Health Care) to 16% (Utilities). In general, the defensive sectors performed better, but there were some outliers. The decline in the Health Care sector certainly was one of them. In addition, the second best performing sector was Materials which was led by strong gains in metals and mining and in steel in particular.

      


  • John Keeley Comments on Teva Pharmaceuticals

    Teva Pharmaceuticals (NYSE:TEVA) also had a challenging quarter. Although earnings were in-line with expectations, the company announced that its acquisition of Allergan’s generic pharmaceutical business would be delayed. Subsequent to the failure of the Pfizer/Allergan merger due to the proposed tax inversion regulatory changes, Teva announced that its acquisition of Allergan’s generic business remains on track to close in the second quarter of 2016.


    From Keeley All Cap Value Fund first quarter 2016 commentary.

      


  • John Keeley Comments on Mylan Labs

    Mylan Labs (NASDAQ:MYL), another detractor, announced a slightly weaker quarter than expected as well as the acquisition of European-based Meda, which appeared expensive in our opinion. We met with management at a recent investor conference and discussed their failed hostile takeover attempt of Perrigo (PRGO), their rebuffing of Teva Pharmaceutical’s simultaneous acquisition offer, and its acquisition of Meda. Even though we believe the stock is relatively cheap, we did not receive satisfactory responses to our questions; as such we elected to sell the position.


    From Keeley All Cap Value Fund first quarter 2016 commentary.

      


  • John Keeley Comments on Wright Medical Group

    Health Care proved to be challenging this quarter and our leading detractors all came from this sector. Despite a positive quarter and the completion of a recent European based acquisition, Wright Medical Group (NASDAQ:WMGI) stock was pressured on fears of potential litigation involving metal to metal hip implants, which could exceed the company’s liability insurance. Other orthopedic companies have suffered from similar legal disputes involving alleged, early device failure in recent years. A judgement was recently handed down on its first case with 80% less in damages awarded than had been initially estimated. Regardless of what appears to be a favorable outcome, WMGI plans to appeal the case and ultimately hopes to certify and settle the class of claims well within its liability insurance limits. We believe WMGI will ultimately prevail on this issue and the stock remains attractive.


    From Keeley All Cap Value Fund first quarter 2016 commentary.

      


  • John Keeley Comments on Tribune Media

    Another leading stock contributor this quarter was from the Consumer Discretionary sector. Tribune Media (NYSE:TRCO) has been a long-term holding based on media companies separating their print/publishing operations from their broadcast divisions. In addition, we believe that the presidential election cycle favors news broadcasting companies. Tribune announced solid fourth quarter earnings and alluded to the fact that it had hired several investment banks to review financial alternatives to enhance shareholder value. We believe Tribune is significantly undervalued and it remains our highest-weighted position.


    From Keeley All Cap Value Fund first quarter 2016 commentary.

      


  • John Keeley Comments on NRG Energy

    Also in the Utilities sector, NRG Energy (NYSE:NRG) was a solid contributor during the quarter. The power company engages in the production, sale, and distribution of energy and energy services. The company announced earnings that were in-line with analyst expectations and also announced it was cutting its dividend to expedite its deleveraging process. While we did not believe that cutting the dividend was necessary, doing so provided comfort to investors that management was serious about balance sheet improvement. We believe the stock is attractively priced.


    From Keeley All Cap Value Fund first quarter 2016 commentary.

      


  • Keeley All Cap Value Fund 1st Quarter Commentary

    In the first calendar quarter of 2016, the KEELEY All Cap Value Fund (KACVX) increased 0.28% compared to a 1.64% rise for the Russell 3000 Value Index. The year began under a rather ominous cloud in January as U.S. equity markets faced tremendous headwinds. The S&P 500 Index, which dropped by 9% from the end of last year through January 21, recorded its worst start to a year in the history of the Index. Fortunately, the environment quickly reversed course following the European Central Bank’s announcement to expand its stimulus efforts against low inflation. In addition, the Bank of Japan’s surprise interest rate cut (to negative territory), helped turn around the declines seen early this year. In the U.S., market participants scaled back their expectations for the number of interest rate hikes this year as the Fed observed tepid GDP growth and continued low inflation. Further, the news from China remained subdued.


    U.S. equity markets strengthened during February and March, closing the quarter in positive territory. However, there was wide dispersion among the various sectors during the quarter. Within the Russell 3000 Value Index, sector performance ranged from -4.8% (Financials) to 15.4% (Utilities). Financials, which represents the largest Index weight at nearly 30%, came under pressure as expectations for more interest rate hikes dissipated and concerns about the global economy surmounted earlier in the year.

      


  • Keeley Small Cap Value Fund 1st Quarter Commentary

    In the first calendar quarter of 2016, the KEELEY Small Cap Value Fund (KSCVX) increased 0.71% compared to a 1.70% rise for the Russell 2000 Value Index. The year began under a rather ominous cloud in January as U.S. equity markets faced tremendous headwinds. The S&P 500 Index, which dropped by 9% from the end of last year through January 21, recorded its worst start to a year in the history of the Index. Fortunately, the environment quickly reversed course following the European Central Bank’s announcement to expand its stimulus efforts against low inflation. In addition, the Bank of Japan’s surprise interest rate cut (to negative territory), helped turn around the declines seen early this year. In the U.S., market participants scaled back their expectations for the number of interest rate hikes this year as the Fed observed tepid GDP growth and continued low inflation. Further, the news from China remained subdued.


    U.S. equity markets strengthened during February and March, closing the quarter in positive territory. However, there was wide dispersion among the various sectors during the quarter. Within the Russell 2000 Value Index, sector performance ranged from -9.0% (Health Care) to 12.3% (Utilities). Within Health Care, market cap size seemed irrelevant as a number of large cap companies reported negative earnings guidance. This downward pressure negatively impacted small cap stocks in the Index; however, the Fund’s health care positions were able to protect the downside through positive stock selection and a relative underweight.

      


  • 10 Years of Strong Returns: Priceline, Biogen

    According to GuruFocus' All-in-One Screener, the following stocks have had strong performances over the last 10 years with high and steady returns as well as profitability. EPS has also grown steadily with the companies' revenues. Most of these companies have great cash-to-debt ratios.


    KapStone Paper And Packaging Corp. (KS)

      


  • Stake in Parsley Energy Added to Keeley's Portfolio

    Guru John Keeley died last year, but Keeley Asset Management continues to operate. The most significant fourth-quarter investment was the purchase of a 1,355,280-share stake in Parsley Energy Inc. (NYSE:PE), a Midland, Texas-based oil and natural gas company, for an average price of $18.09 per share.


    The transaction had a 0.8% impact on Keeley’s portfolio.

      


  • Keeley Funds Comments on John Bean Technologies

    Another strong performing stock in the fourth quarter was long-time holding John Bean Technologies (NYSE:JBT) which climbed over 30 percent and added 42 basis points of performance to the Fund. The provider of solutions for food processing and airport transportation continued its impressive string of exceeding earnings estimates by delivering results in the third quarter that were 12 percent ahead of expectations. The company continues to see strong FoodTech sales and they also made an accretive acquisition of A&B Process, which makes fluid food equipment.


    From Keeley Small Cap Value Fund fourth quarter 2015 commentary.

      


  • Keeley Funds Comments on LegacyTexas Financial

    The second largest detractor was LegacyTexas Financial (NASDAQ:LTXB) which declined over 17 percent and cost the Fund 32 basis points of performance. LegacyTexas posted a disappointing third quarter earnings release due primarily to higher loan loss reserves. Although none of these were related to exposure to energy, there continues to be a perception that the company may face longer term issues as oil approaches $30 a barrel.


    From Keeley Small Cap Value Fund fourth quarter 2015 commentary.

      


  • Keeley Funds Comments on Knowles Corp

    The fund’s largest detractor during the quarter was Knowles Corp. (NYSE:KN) which declined over 27 percent and cost the Fund 32 basis points of performance during the quarter. The supplier of acoustic solutions to the mobile communications industry, and former spin-off of Dover Corp. continues to be a challenging position for the firm. Although earnings exceeded expectations due to a lower tax rate, the company lowered guidance despite getting back on the Apple iPhone 6S platform. Additionally, specialty component sales into the wireless base station business were weaker due to lower telecom cap ex, mainly in China, and more recent concerns of depressed demand for smartphones have pressured the stock. Looking out into 2016, the China telecom spend is expected to rebound, the Audience acquisition should become accretive and the company should further increase market share on the iPhone 7.


    From Keeley Small Cap Value Fund fourth quarter 2015 commentary.

      


  • Keeley Funds Comments on Marriott Vacations Worldwide Corp

    The second largest detractor was Marriott Vacations Worldwide Corp. (VAC) which fell over 16 percent and cost the Fund 28 basis points in performance. Despite a number of business channels remaining strong, such as their resort management, rentals, and financing businesses, lower revenue and a stronger U.S. dollar had a negative impact on their earnings. The company also lowered its sales guidance placing additional pressure on their shares.


    From the Keeey Small Cap Dividend Value Fund fourth quarter 2015 commentary.

      


  • Keeley Funds Comments on LegacyTexas Financial Group

    The largest detractor during the quarter was LegacyTexas Financial Group (LTXB) which declined over 17 percent and cost the Fund 31 basis points of performance. LegacyTexas reported a disappointing third quarter earnings release due primarily to higher loan loss reserves. Although none of these were related to exposure to energy, there continues to be a perception that the company may face longer-term issues as oil approaches $30 a barrel.


    From the Keeey Small Cap Dividend Value Fund fourth quarter 2015 commentary.

      


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