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John Rogers

John Rogers

Ariel Capital Management
Last Update: 2013-05-14

Number of Stocks: 138
Number of New Stocks: 9

Total Value: $5,828 Mil
Q/Q Turnover: 12%

Countries: USA
Details: Top Buys | Top Sales | Top Holdings  Embed:
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John Rogers Watch

  • John Rogers Ponders Buffett Quote in April Commentary

    by Holly LaFon - May 15, 2013
    Last year's April commentary provided an update from our annual pilgrimage to the Berkshire Hathaway (BRK.A)(BRK.B) shareholder meeting. While the meeting's timing prevents us from doing so this year, we do want to ponder a key insight from legendary investor Warren Buffett. In his 1996 Berkshire Hathaway letter he wrote: "Charlie and I would much rather earn a lumpy 15% over time than a smooth 12%." We have been mulling over this statement because after years of outflows from U.S. equity funds and inflows to bond funds, investors seem to have changed behavior. Specifically, in 2013 they are once again sending new money to domestic stock funds. So we have been wondering what investors really want. As a start, we think it is clear the crowd is not with Warren and ourselves in preferring bigger, uneven gains to lower, placid ones.

    In recent years, investors have yanked assets away from surging equities and pushed them toward fixed-income securities that, in our view, were becoming increasingly unattractive. When examining the most recent data from Morningstar, we noticed that there were two categories of funds among investors' top five favorites over the past three-, five- and 10-year periods and two corresponding disliked groups. That is, the Intermediate-Term Bond and Diversified Emerging Markets (Equities) categories have ranked in the top five funds by inflows over all three periods while the Large Growth and Mid-Cap Growth cohorts have among the top-five outflows. For most investors, mid growth funds and emerging markets funds serve as supporting players whose flows might occur for a range of good reasons and be incidental to the portfolio overall. For that reason, we will focus on large growth and intermediate bond funds.  Continue Reading »


  • John Rogers Comments on Western Union Co.

    by Holly LaFon - May 09, 2013
    In the first quarter, we initiated a position in Western Union Co. (WU), a current holding in Ariel Appreciation Fund and Ariel Focus Fund. Western Union is the global leader in money transfer and payment services. With over 500,000 locations that serve 200 countries, the company's scale and network advantages create high barriers to entry and attractive economics. Even though money transfer volumes are recovering from the global recession, the stock trades at a historically low valuation. We view Western Union as an excellent, wide-moat franchise, with meaningful growth prospects, excellent free cash flow generation and sustainable competitive advantages that position it well for an evolutionary shift towards mobile payments.

    From John Rogers’ first quarter 2013 commentary.  Continue Reading »


  • John Rogers Comments on Chesapeake Energy Corp.

    by - May 09, 2013
    Specifically, Chesapeake Energy Corp. (CHK), a holding in some of our other portfolios, priced a joint venture at prices roughly 35% lower than recent transaction values for similar land. The deal implied low prices for deals across the space, hitting Contango's stock. Many believe the company's sale is imminent, and while it is reasonable to assume it could be, we do not believe management would sell its unencumbered assets on the cheap when they can afford to wait. As patient investors, that is what we would do, and we count their team as fellow travelers.

    From John Rogers’ first quarter 2013 commentary.  Continue Reading »


  • John Rogers Comments on Contango Oil & Gas Co.

    by - May 09, 2013
    Also, natural gas exploration company Contango Oil & Gas Co. (MCF) fell -5.36% as the appetite for mergers and acquisitions in the industry lessened.

    From John Rogers’ first quarter 2013 commentary.  Continue Reading »


  • John Rogers Comments on Simpson Manufacturing Co.

    by - May 09, 2013
    Construction materials specialist Simpson Manufacturing Co., Inc. (SSD) returned -6.65% as short-term issues obscured the company's normalized earnings power. First, the company made four strategic acquisitions for a cost of roughly $115 million in 2010 and 2011. It did not take on debt in order to fund the takeovers and had more than $150 million in cash on the balance sheet afterwards. These purchases have crimped margins recently, largely due to lower research and development costs. Second, big box retailer Lowe's replaced one of Simpson's products with a lowercost competitor because negotiations over price broke down. We took this as a good signal: Simpson would not slash prices when housing construction remained slow. The housing market is recovering fast, and housing construction is advancing in sync, which we believe will boost Simpson's earnings back toward normalized levels.

    From John Rogers’ first quarter 2013 commentary.  Continue Reading »


  • John Rogers Comments on Scientific Games Corp.

    by - May 09, 2013
    On January 31, 2013, it was announced Scientific Games Corp. (SGMS) would purchase the company for $26.00 per share in an all-cash bid. We believe this result confirms our process. That is, we estimate an intrinsic value for our holdings, buying when shares trade at a significant discount to that calculation. Thus, even if a transaction occurs below our best estimate, there is still room to profit even when a lower bid is accepted. We sold the stock in response to the bid, in the $24 to $25 range.

    From John Rogers’ first quarter 2013 commentary.  Continue Reading »


  • John Rogers Comments on WMS Industries Inc.

    by - May 09, 2013
    In addition, leading gaming machine manufacturer WMS Industries Inc. (WMS), cashed in for a +41.09% gain as it agreed to a buyout. We purchased the stock in the last quarter of 2012 at around $16 per share; as part of our work, we calculated a strategic buyer would likely pay around $32 per share in an acquisition. At the time neither we nor anyone we know of anticipated an offer in the near-term; the calculation is a part of our discipline.

    From John Rogers’ first quarter 2013 commentary.  Continue Reading »


  • John Rogers Comments on KKR & Co,

    by - May 09, 2013
    We had several stocks with strong returns in the first quarter. Private equity firm KKR & Co. L.P. (KKR) rose +31.84% due to strong fundamentals. Specifically, the company reported fourth quarter 2012 earnings of $0.48 per share versus consensus of $0.21. Its assets under management increased 28% over the past 12 months—up 14% from just the previous quarter. Returns on its private equity portfolio powered the increases, appreciating 24% in 2012—considerably higher than the S&P 500 Index. Originally our thesis held the stock was a bargain because it reflected its fee-based businesses but not carried interest. That inefficiency no longer exists, but now the crowd seems well behind the curve on the company's growth potential. We believe a broad distaste for many types of financial services firms remains in the wake of the Great Recession; in our view, this emotional backlash creates significant opportunities.

    From John Rogers’ first quarter 2013 commentary.  Continue Reading »


  • John Rogers' Ariel Investments Q1 Commentary

    by Holly LaFon - May 09, 2013
    Investing in small and mid-cap stocks is more risky and more volatile than investing in large cap stocks. Ariel Fund often invests a significant portion of its assets in companies within the financial services and consumer discretionary sectors and its performance may suffer if these sectors underperform the overall stock market. Performance data quoted represents past performance. Past performance does not guarantee future results. All performance assumes the reinvestment of dividends and capital gains and represents returns of the Investor Class shares. The investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. For the period ended March 31, 2013, the average annual total returns of Ariel Fund (Investor Class) for the one-, five- and tenyear periods were +21.57%, +8.18% and +9.06%, respectively. Ariel Fund's Investor Class shares had an annual expense ratio of 1.06% for the year ended September 30, 2012. Performance data current to the most recent month-end for Ariel Fund may be obtained by visiting our web site, arielinvestments.com.

    Stocks went on a big tear in the first quarter of 2013, especially in the United States. Equities tend to perform well in the first quarter because individual investors and institutions put money to work as a part of standard practice. Still, this year was even better than most. The large-cap S&P 500 Index jumped +10.61% but not as high as the small-cap Russell 2000 Index's +12.39% leap. While global stocks look tame by comparison, the MSCI EAFE Index's +5.23% gain is very strong on an absolute basis. Moreover, most key U.S. indices hit all-time records. Going into the quarter, the all-time highs for the Dow, S&P 500, and Russell 2000 were 14,164, 1565, and 868, respectively. The Indexes ended the quarter at 14,578, 1569, and 951—all above the previous highs. Sentiment clearly has moved decisively toward stocks. According to TrimTabs Investment research, nearly $78 billion flowed into U.S. stock mutual funds and ETFs just in January, an all-time record month. Similarly, Investors Intelligence reports that roughly four out of every five investors is bullish. While some of that sentiment is likely performance-chasing, we think the hangover of pessimism from the 2007-2009 financial crisis is finally fading and people are realizing that the economy is strengthening and growing. In the first quarter of 2013, Ariel Fund returned +15.76%, topping the Russell 2500 Value Index and the Russell 2000 Value Index, which rose +13.35% and +11.63%, respectively.  Continue Reading »


  • Ariel Funds' Commentary on March

    by Holly LaFon - Apr 12, 2013
    This month we would like to explain how we think about portfolio capacity given the Ariel micro-cap value portfolio is approaching the level where we have said we would close it to new investors. That, of course, is a more pragmatic concern, but we think the issue of why and when to stop accepting new clients and new dollars into a stock portfolio proves an interesting as well as important topic.

    Investors now are generally aware that portfolios have a certain level of capacity, but because it has become so well-known the details behind the practice can get lost. The overarching rationale for closing a mutual fund, separate account or other vehicle is to preserve the investment discipline which allows the philosophy and process to create handsome returns. It prevents the degradation of performance.  Continue Reading »


  • John Rogers of Ariel Funds' Feb Market Insight - In-Depth Perspective on the Current Market Environment

    by Holly LaFon - Mar 15, 2013
    Whenever people ask our macroeconomic outlook or projections, we tell them our views ultimately come down to what we hold in our portfolios. That is, we are pure bottom-up stock pickers who select each stock on its own merit, endeavoring to buy strong businesses at discounts to their intrinsic value. So we do not have any sort of top-down GDP growth projection based on abstruse calculations. Rather, we develop a broad perspective from what management teams tell us. Ultimately, then, our view of the future maps organically to our top holdings. One way to use this information is to detect the shifts in our views from one year to the next based on the changes to our top holdings firmwide. This month, we will walk you through that exercise.
    Below is a list of our top 10 firmwide holdings (by assets) as of December 31, 2012, complete with the 2012 year-end firmwide rank, the 2011 year-end firmwide rank and the share count percentage change. We have also included the stocks that were in the top 10 at the end of 2011 but were not in that group this year.  Continue Reading »


  • John Rogers of Ariel Investments Has Some Stock Picks for Us

    by CanadianValue - Mar 15, 2013
    When asked what investors need to be worrying about, Rogers suggests that trouble in the Middle East or a terrorist attack would be the top of his list of concerns.

    His favorite stocks are:  Continue Reading »


  • Ariel Investments Value Investor Charles Bobrinskoy Advises Us to Sell Our Bonds Immediately

    by CanadianValue - Mar 11, 2013
    Bobrinskoy cuts straight to the chase and doesn't mince words. His advice:

    "Go straight home, find all of your long-term bonds and sell them. Put the money in cash if you have to, but most importantly sell your bonds."  Continue Reading »


  • Turtle Talking John Rogers Adds VSR

    by Sally Jones - Mar 09, 2013
    John Rogers - Turtle Talking John Rogers Adds VSR On February 28, 2013 the “Patient Investor” John Rogers made his first trade of 2013. The Founder of Ariel Capital Management added Versar, Inc. (VSR) to his portfolio increasing by 8.45%, with current shares of 1,041,547. VSR’s current price is $4.44. Versar, Inc. is a global management company providing engineering, construction, environmental, and professional sservices to a variety of customers in the private sector and the government. As a DoD contractor serving over 20 installations and industrial facilities in the U.S. and abroad, the company also provides national security services through its subsidiary GEOMET Technologies, LLC.

    Ariel Capital Management lists VSR as one of 133 stocks in a portfolio with a total value of $4.78 billion and a quarter-over-quarter turnover of 8%. Rogers manages Ariel's small and mid-cap institutional portfolios as well as the Ariel Fund (ARGFX) and Ariel Appreciation Fund (CAAPX). Ariel Capital also lists two new funds: Ariel International Equity, and Ariel Global Equity Fund. John Rogers’s holding history of VSR shows a steadily increasing stake since third quarter 2010.  Continue Reading »


  • John Rogers' Q4 Ariel Fund Commentary

    by Holly LaFon - Feb 13, 2013
    John Rogers - John Rogers' Q4 Ariel Fund Commentary Investing in small and mid-cap stocks is more risky and more volatile than investing in large cap stocks. Ariel Fund often invests a significant portion of its assets in companies within the financial services and consumer discretionary sectors and its performance may suffer if these sectors underperform the overall stock market. Performance data quoted represents past performance. Past performance does not guarantee future results. All performance assumes the reinvestment of dividends and capital gains. The investment return and principal value of an investment will fluctuate so that an investor's shares, when redeemed, may be worth more or less than their original cost. Current performance may be lower or higher than the performance data quoted. For the period ended December 31, 2012, the average annual total returns of Ariel Fund (Investor Class) for the one-, five- and ten-year periods were +20.32%, +2.59% and +6.87%, respectively. Ariel Fund's Investor Class shares had an annual expense ratio of 1.06% for the year ended September 30, 2012 and 1.04% for the year ended September 30, 2011. Performance data current to the most recent month-end for Ariel Fund may be obtained by visiting our web site, arielinvestments.com.

    Globally stocks performed quite well in the last three months of 2012, but the uncertainties created by the fiscal cliff in the United States hampered returns here. For the most part, 2012 followed the same general pattern traversed the last two years: a strong start, followed by a swoon, ending with a good finish. The MSCI EAFE Index, for instance, was up +11.43% in the first two months of the year, down -7.23% from March 1st through June 30th, then jumped +14.05% in the last half of the year. In the U.S., stocks from large-caps to micro-caps followed a similar trajectory but faded in the fourth quarter. It seems many Americans sold due to the potential changes in tax rates more than because they feared the economic damage some prognosticators forecasted. In the end, taxes did not change as much as some expected, so it is possible individuals may buy stocks back. In our domestic portfolios, we used the lethargic three-month period to trim relatively more expensive holdings and add to cheaper ones— and find more bargains. In the fourth quarter of 2012, Ariel Fund returned +4.09%, landing between the Russell 2500 Value Index and the Russell 2000 Value Index, which rose +4.14% and +3.22%, respectively.  Continue Reading »


  • Value Investor John Rogers Discusses McDonald's, Warren Buffett and Why Stocks Are the Best Investment Class

    by CanadianValue - Feb 13, 2013
    John Rogers, CEO of Ariel Investments, tells Impact Players host Robert Wolf why following Warren Buffett's direction makes sense, how he ate his way onto McDonald's (MCD) board and why he's going with stocks now. Rogers oversees a $5 billion portfolio and runs the largest minority-owned mutual fund firm in America.

      Continue Reading »


  • John Rogers December Monthly Market Commentary

    by Holly LaFon - Feb 01, 2013
    As our investment universe has expanded up and down the market cap spectrum, and to encircle the globe, we have found tracking more indices quite helpful. We thought our clients and prospective investors could benefit from our view of the world at year-end both to characterize the recent past and to look forward. Broadly speaking, we track domestic stocks across the cap ranges, international issues, and even bonds. The returns below represent five calendar years, along with an annualized return for the entire period.

      Continue Reading »


  • Ariel Investments' John Rogers Grabs 10.2% Ownership of Orion Energy

    by Dianne Tordillo - Jan 10, 2013
    John Rogers - Ariel Investments' John Rogers Grabs 10.2% Ownership Of Orion Energy John Rogers, founder of Ariel Investments, has reported buying more shares of energy management systems company, Orion Energy (OESX), widening his stake by 12.72 percent, according to GuruFocus Real Time Picks. The play pushes Rogers to 10.2 percent owner of the company.

    Starting off with only 45,205 shares, Rogers unremittingly added to his position since buying the stock in 2009. After his latest move on the stock, Rogers’s total holding has reached 2,047,393 shares.  Continue Reading »


  • Ariel Investments' John Rogers on Stocks for 2013

    by Holly LaFon - Jan 08, 2013
    John Rogers - Ariel Investments' John Rogers On Stocks For 2013 For 2013, John Rogers of value investing company Ariel Investments is looking at carpet manufacturers, First American Financial (FAF), any stocks that have any ties to the housing market, financial services such as alternative investment companies Lazard (LAZ), Blackstone (BX), KKR (KKR) and Janus (JNS), and media companies such as CBS (CBS):

      Continue Reading »


  • Rare Interview with Value Guru John Rogers of Ariel Funds

    by Dheeraj Grover - Dec 31, 2012
    In this rare video, value guru and chairman CIO of Ariel Funds, John Rogers, shares his wisdom and advise with college students, discusses his investment strategy and his criteria to pick stocks, and answers tons of student questions.

    Here is the video:  Continue Reading »


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